Notes to the Company Annual Financial Statements | Note 3

3. INVESTMENTS IN SUBSIDIARIES
 

Investments in subsidiaries are carried at cost less any accumulated impairment losses in BLT’s annual financial statements.

Cost is adjusted to reflect changes in consideration arising from contingent consideration amendments. Cost also includes directly attributable costs of investments.

Subsidiaries are all entities over which BLT has control. BLT controls an entity when BLT is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity.

Name of company    % 
holding 
2024 		   %
holding
2023 		   Carrying
amount
2024
R’000 		 Carrying
amount
2023
R’000 
Blu Nova Proprietary Limited    100.00    100.00    — * — *
Blue Label AltBureau Proprietary Limited    100.00    100.00    — * — *
Blue Label Company Proprietary Limited    100.00    100.00    — * — *
Blue Label Distribution Proprietary Limited    100.00    100.00    194 000  194 000 
Blue Label One Proprietary Limited    100.00    100.00    40 000  40 000 
Blue Label Ventures Proprietary Limited    100.00    100.00    — * — *
Blue Moon Asset Company Proprietary Limited    100.00    100.00    — * — *
Budding Trade 1170 Proprietary Limited    100.00    100.00    6 000  6 000 
Datacel Direct Proprietary Limited    100.00    100.00    150 000  150 000 
Glocell Retail Solutions Proprietary Limited    100.00    100.00    —* — *
Gold Label Investments Proprietary Limited    100.00    100.00    — * — *
One World Telecoms Proprietary Limited    100.00    100.00    — * — *
The Prepaid Company Proprietary Limited    100.00    100.00    2 433 048  2 433 048 
TicketPros Proprietary Limited    100.00    100.00    14 700  14 700 
Transaction Junction Proprietary Limited    60.00    60.00    4 200  4 200 
Ventury Group Proprietary Limited    100.00    100.00    98 701  98 701 
WiConnect Proprietary Limited    100.00    100.00    5 000  5 000 
Accumulated impairment of WiConnect                   
Proprietary Limited              (5 000) (5 000)
               2 940 649  2 940 649 

All subsidiaries listed above are incorporated in South Africa.

* Less than R1 000.

The Prepaid Company Proprietary Limited (TPC)

As at 31 May 2024, there was no indicator of an impairment, and as such, the Company did not estimate the recoverable amount of the investment in TPC. There was an indicator identified in the prior year.

In the prior year, a value-in-use calculation was performed to determine the recoverable amount of the investment. This calculation used cash flow projections based on financial budgets approved by the Board of Directors for the forthcoming year and forecasts for up to five years which were based on assumptions of the business, industry and economic growth. Cash flows beyond this period were extrapolated using a terminal growth rate which did not exceed the expected long-term economic growth rate.

The key assumptions used for the value-in-use calculations are as follows:

  2023
Average EBITDA margin % 2.0
Terminal growth % 4.5
Pre‑tax discount rate (%) 22.1

The discount rates used were pre-tax and reflected specific risks relating to The Prepaid Company Proprietary Limited. The growth rate was used to extrapolate cash flows beyond the budget period. The growth rates were consistent with publicly available information relating to long-term average growth rates for the markets in which the companies operate. BLT’s target debt-to-equity ratio was applied in the calculation of the weighted average cost of capital.

Based on the calculation performed, no impairment loss was recognised in the prior year. If one or more of the inputs were changed to a reasonable possible alternative, there would have been no impairments that would have had to be recognised.

WiConnect Proprietary Limited

BLT’s investment in WiConnect Proprietary Limited was fully impaired in FY20. The Directors of WiConnect Proprietary Limited are still in the process of realising all assets and settling all liabilities, after which they will consider deregistering WiConnect Proprietary Limited.