| |
The Group's segment reporting follows the organisational structure as reflected in its internal
management reporting systems, which are the basis for assessing the financial performance of the
business segments and for allocating resources to these segments. Management�s assessment of the
Group's organisational structure takes the geographical location of the segments into account.
Operating segments are reported internally to the chief operating decision-maker in a manner
consistent with the financial statements. In addition, the chief operating decision-maker uses core
headline earnings as a non-IFRS measure in evaluating the Group�s performance on a segmental
level. The chief operating decision-maker, who is responsible for allocating resources and assessing
performance of the operating segments, has been identified as the Executive Directors, who are
responsible for making strategic decisions on behalf of the Group.
Transactions between reportable segments are conducted on similar terms as other transactions of
a similar nature.
The segment results for the year ended 31 May 2021 are as follows:
|
|
| |
Total |
Africa Distribution
| International |
Mobile |
Solutions |
Corporate |
2021
R'000 |
2020
R'000 |
2021
R'000 |
2020
R'000 |
2021
R'000 |
2020
R'000 |
2021
R'000 |
2020
R'000 |
2021
R'000 |
2020
R'000 |
2021
R'000 |
2020
R'000 |
| Continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Total segment revenue |
|
| 26 524 093 |
30 818 506 |
26 177 843 |
30 165 762 |
– |
– |
– |
– |
186 145 |
191 830 |
160 105 |
460 914 |
| Internal revenue |
|
| (7 702 803) |
(9 683 180) |
(7 536 312) |
(9 219 540) |
– |
– |
– |
– |
(6 386) |
(2 726) |
(160 105) |
(460 914) |
| Revenue |
|
| 18 821 290 |
21 135 326 |
18 641 531 |
20 946 222 |
– |
– |
– |
– |
179 759 |
189 104 |
– |
– |
| Segment result |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Operating profit/(loss) before depreciation, amortisation and the additional items listed below |
|
| 1 340 578 |
1 305 929 |
1 436 184 |
1 331 270 |
30 752 |
31 397 |
– |
– |
17 028 |
40 798 |
(143 386) |
(97 536) |
| Impairment of goodwill |
|
| – |
(213 583) |
– |
(213 583) |
– |
– |
– |
– |
– |
– |
– |
– |
| Fair value (loss)/gain on surety receivable |
|
| (21 116) |
19 826 |
– |
– |
(21 116) |
19 826 |
– |
– |
– |
– |
– |
– |
| Fair value gain/(loss) on SPV1 and SPV2 |
|
| 16 009 |
(48 694) |
16 009 |
(48 694) |
– |
– |
– |
– |
– |
– |
– |
– |
| Fair value gain/(loss) on other financial instruments |
|
| 12 902 |
(121 782) |
3 556 |
(73 516) |
– |
– |
– |
– |
– |
– |
9 346 |
(48 266) |
| Expected credit loss on loans |
|
| 61 810 |
(56 214) |
(6 176) |
(4 458) |
41 189 |
(31 749) |
– |
– |
(5) |
(194) |
26 802 |
(19 813) |
| Financial guarantee contracts |
|
| 33 455 |
7 829 |
8 250 |
7 829 |
– |
– |
– |
– |
– |
– |
25 205 |
– |
| Bad debts and expected credit losses on trade receivables, other receivables and advances to customers |
|
| (83 365) |
(67 947) |
(83 088) |
(67 673) |
– |
– |
– |
– |
(277) |
(274) |
– |
– |
| Depreciation and amortisation |
|
| (188 883) |
(189 314) |
(168 402) |
(168 855) |
– |
– |
– |
– |
(748) |
(923) |
(19 733) |
(19 536) |
| Operating profit/(loss) |
|
| 1 171 390 |
636 050 |
1 206 333 |
762 320 |
50 825 |
19 474 |
– |
– |
15 998 |
39 407 |
(101 766) |
(185 151) |
| Finance costs |
|
| (131 947) |
(229 988) |
(126 381) |
(215 296) |
– |
(48) |
– |
– |
(166) |
(196) |
(5 400) |
(14 448) |
| Finance income |
|
| 59 717 |
78 175 |
59 361 |
75 474 |
– |
998 |
– |
– |
234 |
1 470 |
122 |
233 |
| Share of profits/(losses) from associates and joint ventures |
|
| 2 951 |
16 598 |
3 783 |
2 635 |
(6 554) |
(5 806) |
– |
– |
5 722 |
19 769 |
– |
– |
| Taxation |
|
| (249 416) |
(219 752) |
(280 271) |
(203 637) |
23 750 |
(8 547) |
– |
– |
5 026 |
(10 784) |
2 079 |
3 216 |
| Profit/(loss) for the year from continuing operations |
|
| 852 695 |
281 083 |
862 825 |
421 496 |
68 021 |
6 071 |
– |
– |
26 814 |
49 666 |
(104 965) |
(196 150) |
| Profit/(loss) for the year from continuing operations attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Equity holders of the parent |
|
| 805 286 |
226 786 |
820 819 |
375 952 |
68 021 |
6 071 |
– |
– |
21 411 |
40 913 |
(104 965) |
(196 150) |
| Non-controlling interest |
|
| 47 409 |
54 297 |
42 006 |
45 544 |
– |
– |
– |
– |
5 403 |
8 753 |
– |
– |
| Profit/(loss) from discontinued operations attributable to equity holders of the parent |
|
| 25 321 |
(102 305) |
25 321 |
(261 707) |
– |
14 617 |
– |
144 785 |
– |
– |
– |
– |
| Profit/(loss) for the year attributable to equity holders of the parent |
|
| 830 607 |
124 481 |
846 140 |
114 245 |
68 021 |
20 688 |
– |
144 785 |
21 411 |
40 913 |
(104 965) |
(196 150) |
| Reconciliation of profit/(loss) for the year to core headline earnings for the year |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Profit/(loss) for the year attributable to equity holders of the parent |
|
| 830 607 |
124 481 |
846 140 |
114 245 |
68 021 |
20 688 |
– |
144 785 |
21 411 |
40 913 |
(104 965) |
(196 150) |
| Amortisation of intangibles raised through business combinations net of tax and non-controlling interest |
|
| 30 663 |
40 819 |
30 663 |
36 357 |
– |
3 835 |
– |
627 |
– |
– |
– |
– |
| Headline earnings adjustment |
|
| (73 690) |
396 832 |
3 859 |
372 374 |
(79 493) |
(2 908) |
– |
27 369 |
– |
(3) |
1 944 |
– |
| Core headline earnings for the year |
|
| 787 580 |
562 132 |
880 662 |
522 976 |
(11 472) |
21 615 |
– |
172 781 |
21 411 |
40 910 |
(103 021) |
(196 150) |
The Company is domiciled in the Republic of South Africa. The continuing revenue earned from
external customers in South Africa is R18.8 billion (2020: R21.1 billion), and from external customers
from other countries is R1.9 million (2020: R6 million).
The Africa Distribution segment includes revenue of R3.4 billion and R2.3 billion earned from two
external customers.
At 31 May 2021, the Group is managed on the basis of five main business segments:
- Africa Distribution includes the distribution of prepaid airtime, starter packs and electricity of the.
South African network operators and utility suppliers, and the distribution and financing of
handsets, tablets and other devices within South Africa and certain African countries.
- International includes associate operations involved in the distribution of prepaid airtime in Mexico,
which was disposed of in the current year, and the investment in Oxigen Services India. Refer to
note 2.1.
- Mobile included the provision of a complete mobile transactional ecosystem and services
provisioning platform delivering mobile-centric products and services through any mobile channel,
including location-based and WASP services, and music and digital content provision. The entities
within this segment, forming part of the VAS operations, were disposed of in the prior year and
accounted for as discontinued operations.
- Solutions includes marketing of cellular and financial products and services through outbound
telemarketing and other channels, provides inbound customer care and technical support, and
markets data and analytics services.
- Corporate performs the head office administration function.
Discontinued operations
The current segmental results account for the discontinued operations within the Africa Distribution
segment (WiConnect) and the prior year for the discontinued operations within the Africa
Distribution segment (3G Mobile, Airvantage and WiConnect), the Mobile segment (Cellfind,
Panacea, Simigenix and Viamedia) and the International segment (AV Technology and Airvantage
Brazil).
Core headline earnings
Core headline earnings is a non-IFRS measure used by the Group in evaluating the Group�s
performance. This supplements the IFRS measures. Core net profit is calculated by adjusting net
profit for the year with the amortisation of intangible assets net of deferred taxation and noncontrolling
interests that arise as a consequence of the purchase price allocations completed in
terms of IFRS 3 � Business Combinations. Core headline earnings is calculated by adjusting core net
profit with the headline earnings adjustments required by SAICA circular 1/2021.
Reconciliation of core headline earnings to relevant IFRS measures is presented in note 1.5. |