contents · corporate profile 3 our business overview 5 - statement of vision - historical...

CONTENTS

Corporate Profile 3

Our Business Overview 5

- Statement of Vision

- Historical Highlights

- The African Sun Way

- Brands

- Property Portfolio

Financial Highlights 11

Message From The Chairman 12

Our Strategy 14

Group Chief Executive’s Report 15

Accounting Philosophy 19

Certificate by The Company Secretary 21

Directors’ Report 22

Corporate Governance 23

Directors’ Responsibility for

Financial Reporting 28

Independent Auditor’s Report 29

Statement of Financial Position 31

Consolidated Statement of

Comprehensive Income 32

Consolidated Statement of Changes

in Equity 33

Consolidated Statement of Cash Flows 34

Notes to the Financial Statements 35

Group Supplementary Information 102

Shareholders’ Profile 103

Group Structure 106

Board of Directors 107

Corporate Information 111

Management 112

Notice to Members 113

Shareholders’ Diary 115

Corporate and Hotel Directory 116

African Sun Limited Annual Report 2014 1

STRENGTHENEDFOR GROWTH

African Sun Limited Annual Report 20142

The only way that we can live, is if we grow. The only way that we can grow is if we change. The only way that we can change is if we learn. The only way we can learn is if we are exposed. And the

only way that we can become exposed is to throw ourselves out into the open to

prove our strength.


CORPORATE PROFILE

African Sun Limited is a leading hotel operator on the African continent operating internationally recognised brands. With a clear vision to become the benchmark hotel management company in the markets that we operate in, the Group leases hotels and resorts in Zimbabwe and Ghana, and has management contracts in Nigeria.

OUR BUSINESS

ZimbabweThe Zimbabwe operations portfolio currently forms the largest business segment under African Sun and comprises seven resorts, five city hotels, timeshare units and four casinos.

ResortsThe resort hotels are located in the country’s primary tourist destinations. These include three resort hotels in the town of Victoria Falls namely Elephant Hills Resort & Conference Centre, The Kingdom at Victoria Falls and The Victoria Falls Hotel; with the latter jointly operated with Meikles Hospitality (Private) Limited. Close to the resort town of Victoria Falls in Hwange is African Sun’s safari operation, Hwange Safari Lodge. The other resort hotels operated by the Group are; the Great Zimbabwe Hotel in Masvingo, located within walking distance of the Great Zimbabwe National Monument, Troutbeck Resort in Nyanga and Caribbea Bay Resort in Kariba.

City HotelsThe city hotels comprise three InterContinental Hotels Group (“IHG”) affiliated brands, the Crowne Plaza Monomotapa, and the two Holiday Inn branded hotels in Harare and Bulawayo. African Sun Amber Hotel Mutare and Beitbridge Express Hotel make up the city hotels portfolio and are the Group’s home-grown brands.

TimesharesThe Group manages the Blue Swallow and the Kingfisher Cabanas timeshare units situated in Nyanga and Kariba, respectively.

Sun CasinosSun Casinos is the largest corporate and charity casino operator in Zimbabwe, with four casinos located across the country.

WEST AFRICAN SUN

NigeriaThe Group has a presence in Nigeria where the following hotels are operated under management contracts; Nike Lake Resort in Enugu State, African Sun Amber Residence in GRA, Ikeja, Lagos and the newly opened African Sun Airport Hotel Lagos.

GhanaAfrican Sun has resumed operations in Ghana with the opening of a new leased hotel, African Sun Amber Hotel Accra Airport.

PROCESSES


As African Sun adds more rooms to its portfolio, a combined brand strategy involving the use of InterContinental Hotels Group (“IHG”) brands, namely Holiday Inn and Crowne Plaza as well as the Best Western brands will be implemented. The IHG and Best Western brands are tried and tested with great brand equity and awareness, especially amongst international and business travellers. African Sun will also use its own brands in markets where the Group deems it appropriate; these are made up of:�� Ea\%jYf_]2� 9^ja[Yf�Kmf�9eZ]j3�� NYdm]2� 9^ja[Yf�Kmf�9eZ]j�=phj]kk3�Yf\��Dgf_�klYq2� 9^ja[Yf�Kmf�Kmal]k

The Group has strengthened its operations to achieve growth going forward. We continue with our quest to grow shareholder value, anchored by our four pillars:�� H]ghd]3�� Hjg\m[l3�� Hjg[]kk]k3�Yf\�� Hjgeglagf

CORPORATE PROFILE

African Sun Limited Annual Report 20144 African Sun Limited Annual Report 20144


STATEMENT OF VISIONTo be the benchmark hotel operator wherever we operate leveraging on the full tourism value chain.

MISSIONWe exist to create value for all our stakeholders through the deployment of our intellectual property and service skills in a professional, predictable and consistent manner.

WE DO SO BY:��@Ynaf_�Y�^gjeYdak]\�Yf\�hjghja]lYjq�Zmkaf]kk�eYfY_]e]fl�kqkl]e&��9fla[ahYlaf_�Yf\�e]]laf_�l`]�f]]\k�g^�gmj�_m]klk&��;j]Ylaf_�ghhgjlmfala]k�^gj�h]jkgfYd�_jgol`&��:mad\af_�dgf_%l]je�hYjlf]jk`ahk�l`jgm_`�oaf%oaf�j]dYlagfk`ahk�oal`�gmj�klYc]`gd\]jk&

OUR CORE VALUES AND BELIEFS

INTEGRITY – We do what we say. We are true to self and true to others.

RESPECT – In all our relationships, we seek to build and honour.

CARE – We show concern and seek the well-being of everyone.

FUN - We enjoy everything we do.

PROFESSIONALISM – We exude expert competence in the way we do business.

RESPONSIBLE MANAGEMENT – Conservation of our natural and other resources is integral in all we do.

OUR BUSINESS OVERVIEW



Historical Highlights: Our Journey Thus Far

– Rhodesia and Nyasaland Hotels (Private) Limited is formed as a wholly-owned subsidiary of Rhodesian Breweries (Private) Limited.

– Sable Hotels (Private) Limited is established.

– Rhodesian Government grants first casino licence for The Victoria Falls Hotel.

– Development of the first four world-class hotels: Monomotapa Hotel in Salisbury, The Wankie Safari Lodge in Wankie, Caribbea Bay in Kariba, and the Elephant Hills Country Club in Victoria Falls.

– Meikles Southern Sun Hotels is established, becoming the largest hotel chain in Southern and Eastern Africa, with control of 13 major properties in the country.

– Meikles Southern Sun Hotels changes its name to Zimbabwe Sun Hotels after Zimbabwe’s independence.

– Zimbabwe Sun Hotels merges with Touch the Wild safari operations, later sold to Rainbow Tourism Group (Private) Limited on 30 April 1998.

– Zimbabwe Sun Limited is floated on the Zimbabwe Stock Exchange (“ZSE”), at the time being the largest flotation in Zimbabwe, with 70 million shares offered to the public, which was over-subscribed by 28%.

– Opening of the timeshares built in Troutbeck, Nyanga and at Caribbea Bay, which received “Gold Crown Resorts” status from the Resort Condominium International (“RCI”) in 1999.

– First Holiday Inn franchise in Harare.

– The Elephant Hills Resort and Conference Centre officially opens its doors.

– First regional office for reservations is established in Johannesburg.

– The construction of Express by Holiday Inn Beitbridge is completed.

– Zimbabwe Sun Limited acquires 40% equity and management of Baio Do Paraiso SARL, Mozambique.

– Makasa Sun is re-developed into The Kingdom at Victoria Falls.

– Zimbabwe Sun Limited is unbundled from Delta Corporation Limited.

– Zimbabwe Sun Limited owns 100% shares in the timeshare operation in Vilanculos, Mozambique.

– Dawn Properties Limited is listed as the first property entity on the Zimbabwe Stock Exchange.

– The Hospitality Training Academy (“HTA”) is re-launched.

– Zimbabwe Sun Limited acquires The Grace Hotel in Rosebank, South Africa, ranked among the “Top Ten” hotels in Africa and the Middle East by Condé Nast Traveller (USA) in its first year of operation.

– Zimbabwe Sun Limited adds The Lakes Hotel and Conference Centre, in Johannesburg, South Africa to its portfolio.

– Zimbabwe Sun Limited rebrands its name to African Sun Limited.

– African Sun Limited adds Obudu Mountain Resort to its regional portfolio.

– African Sun Limited takes over management of Holiday Inn Accra Airport.

– African Sun Limited acquires Hotelserve Holdings (Private) Limited.

– The Company raises US$10 million through a Rights Offer.

– Best Western Ikeja – Lagos Nigeria opened its doors to the public on 1 October 2010.

– Best Western Homeville, Benin City, Nigeria opened its doors to the public on 1 October 2011.

- African Sun Limited closed The Grace in Rosebank, The Lakes Hotel and Conference Centre in South Africa and

disinvested from Hotelserve Holdings (Private) Limited in Zimbabwe.

- African Sun Limited exits the Holiday Inn Accra Airport Hotel management contract.

- African Sun Amber Residence GRA Ikeja, Lagos Nigeria opened its doors to the public on 2 November 2012.

- African Sun realised the first profit before tax since dollarisation.

- African Sun exited Obudu Mountain Resort after expiry of management contract.

- African Sun Amber Hotel Accra Airport, Ghana opened its doors to the public on 10 December 2013.

- African Sun Airport Hotel Lagos, Nigeria opened its doors to the public on 15 December 2014.


THE AFRICAN SUN WAY

SHARED VISIONWe will always seek buy-in whilst providing competent and professional leadership.

SHARED VALUESOur values are the glue that binds us together.

TIMEOUS EXECUTION AND CLOSUREIt is not done until the task is complete.

EFFECTIVENESSWe will deliver beyond expectations.

ADAPTABILITYWe will be flexible without losing our strategic intent.

EFFICIENCYWe will be disciplined in utilising resources in all we do.

CONNECTIVITYIt is our responsibility to get the message across to the other party.



BRANDS

FRANCHISE BRANDS

STAND-ALONE BRANDS

OWN BRANDS

TIMESHARE BRANDS

PREMIER BRAND

CASINO BRANDS


OUR BRANDS

Our premier brand, The Victoria Falls Hotel, offers world-class hospitality with signature touches that define luxury travel. The IHG brands, consistent with global benchmarks, cater for the needs of global travellers. Our stand-alone brands equipped with definitive personalities, offer real African hospitality with an international touch for both business and leisure travellers. Our home-grown brand, African Sun Amber, is targeted at middle range business and leisure travellers seeking warm and comfortable hotels. Timeshare owners enjoy access to 3 700 holiday resorts in over 100 countries through the Resort Condominium International (“RCI”) exchange. Our casinos offer unforgettable experiences for the gaming enthusiasts.

Celebrate your success and stand strong when adversity hits, for when the storm clouds come in, the eagles soar.


US$Restated

US$

GROUP SUMMARY

Revenue 55 967 643

Loss before tax ( 8 805 936)

EBITDA 4 095 675

Loss for the year (8 829 473)

Total assets 57 834 012

Market capitalisation 17 302 758

SHARE PERFORMANCE

Number of shares outstanding 823 940 874

Basic earnings basis Basic loss per share for the year (1.07)

Diluted loss per share for the year (1.07)

(0.16)

1.73

2.10

FINANCIAL STATISTICS

Return on equity: % (62)

Interest cover: times (1.87)

FINANCIAL HIGHLIGHTS


MESSAGE FROM THE CHAIRMAN

The Group’s EBITDAgrew by 70% in the period

under review, consolidating a discernible growth trend which has been sustained

since 2012.

DEAR SHAREHOLDERSOur business navigated an ever-challenging terrain in the reported period. The outbreak of the Ebola-Virus-Disease (EVD) presented the greatest threat to our business. The misinformation and miscommunication that emanated from the unprepared and panic ridden world’s response to managing the epic pandemic directly affected the travel trade industry through; travel bans, cancellations and postponements. Our West Africa operations being at the epicenter, suffered the most whilst The Kingdom Hotel whose traditional source markets were more dogmatic in imposing travel bans, took the greatest knock from the ensuing EVD driven cancellations in the Zimbabwe operations market. These cancellations were made in spite of the fact that no evidence of Ebola was found in the whole of Southern Africa.

We are however positive that management of the disease and the information around it will continue to improve and that there will be no further depletion of our future bookings and business because of EVD. If anything the UN activity out of Ghana has provided invaluable transient business for the Ghana operation.

The local Zimbabwe market experienced worsening liquidity, revised GDP targets, fiscal stress, reduced influx of foreign direct investment and investor confidence as well the setting in of ‘deflation.’ As the international community registered laudable voices in question of our politics and policy inconsistencies, market analysts and watchers announced ‘economic recession.’

With a resultant shrunken and price sensitive domestic market, our industry was thrown into survival frenzy that manifested, unfortunately and perhaps inadvertently; as ‘price wars’ that prevailed throughout our first half. Our business suffered as occupancy acutely tumbled; only resurging in the second half to achieve almost a flat annual performance on occupancy, revenue and rates matrix.

As there are no signs of easing of the economic pressures in Zimbabwe, we are implementing further austerity measures to mitigate impact of potential business downswing.

BUSINESS UPDATE The Group’s EBITDA grew by 70% in the period under review, consolidating a discernible growth trend which has been sustained since 2012. This attribute of resilience defied a generally difficult operating environment.

Whilst the EBITDA growth trend leaves no doubt about the business’ inherent value creation capacity, the reduction of borrowings to US$17.4 million, from US$22.32 million last year improved the statement of financial position of the Group. The Group’s net current liabilities position improved by 46% to US$5.75 million, down from US$10.72 million reported last year.

Notable improvements in guest satisfaction were recorded in this period, as the property refurbishments

BEKITHEMBA LLOYD NKOMOChairman


MESSAGE FROM THE CHAIRMAN (continued)

that were started 3 years ago are now bearing fruit. Cumulatively, an amount of US$18.4 million, which translates to 11% of revenue, was spent towards hotel refurbishments. The expenditure on refurbishments is however more than twice the international benchmark of 4.5% for similar graded hotels due to the catch up works carried out over this period. Going forward, the refurbishment expenditure is not expected to exceed this benchmark.

Some of the Group’s key capitalisation and debt restructuring initiatives targeted for completion during the period under review have been deferred to the forthcoming year. Their consummation is now anticipated by the end of September 2015, which will improve the working capital going forward.

Debt reduction remains the Group’s priority going forward. Total debt decreased by 22% from September 2013, closing at US$17.4 million, following repayments amounting to US$6.8 million made during the financial year under review.

The Group is targeting to raise additional funds through;�� \akhgkYd�g^�klY^^�`gmk]k�%�MK�,�eaddagf3�� \akhgkYd�g^�l`]�).&-,��afn]kle]fl�af�<Yof�Hjgh]jla]k�Daeal]\�%�MK�-&0�eaddagf3�Yf\�� Y�hgkkaZd]�ja_`lk�g^^]j$�o`gk]�\]lYadk�oadd�Z]�Yffgmf[]\�af�\m]�[gmjk]&

Subsequent to year-end, the Group’s debt was further reduced by US$2.51 million following repayments made from both operating cash flows and proceeds received from a partial disposal of the investment in Dawn Properties Limited.

CORPORATE SOCIAL RESPONSIBILITY African Sun continues to invest back into communities in which we operate to improve their livelihoods. During the period under review, Holiday Inn Harare refurbished 7 houses for SOS Children’s Village in Waterfalls, Harare. Under the same partnership, Crowne Plaza Monomotapa also adopted SOS Children’s Village in Bindura where similar work is going to be carried out in the new financial year. The Victoria Falls Hotel refurbished 6 classroom blocks and installed air conditioners in the computer room for Mosi-a-Tunya High School. The construction of studying tables and seats around the school is underway to create a conducive study environment for students.

ENVIRONMENTAL RESPONSIBILITYWater and energy conservation and waste management continues to be an integral part of our operations and we continue to seek initiatives to conserve our environment in line with the Group’s values of Responsible Management. The Victoria Falls Hotel has made strides over the past 3 years in green operations. In partnership with Conservation Science Africa, the hotel launched a Worm Farm Eco Composting Project, which has become an integral vehicle in preserving and caring for the environment. The worm farm, which has since expanded to local communities, recycles decomposable food waste and materials into high quality eco-compost. The compost is used for growing organic vegetables for the hotel ensuring that the waste management concept of REDUCE, RECYCLE and REUSE are enforced. The Victoria Falls Hotel and The Kingdom at Victoria Falls, through a greening initiative, planted 750 trees around the hotels and the Park outside the two hotels as part of the carbon footprint and growing the next generation of indigenous trees. This initiative will be replicated to other hotels in due course.

DIRECTORATEMr S. Cranswick resigned on 17 November 2014. Ms T. Ndebele, Messrs H. Nkala and G. Manyere were appointed to the board on 24 November 2014. They retire at the end of their interim appointments. All being eligible, they will offer themselves for re-election at the Annual General Meeting.

DIVIDEND DECLARATIONIn view of the current difficult operating environment and the subdued performance, the Board has resolved not to declare a dividend for the year ended 30 September 2014.

APPRECIATIONWe would like to commend management, staff and fellow directors for their continued hard work in this difficult environment.

B L Nkomo Chairman


OUR STRATEGY


GROUP CHIEF EXECUTIVE’S REPORT

SHINGIRAI ALBERT MUNYEZAGroup Chief Executive

INTRODUCTIONI am pleased to report that our Group registered a 70% growth in EBITDA performance, which represents our highest growth since the advent of dollarisation despite a myriad of challenges we had to navigate in the wake of the Zimbabwean economic recession and the outbreak of the Ebola-Virus-Disease (“EVD”) in West Africa which had a worldwide ripple effect on travel trends.

This strong EBITDA performance demonstrates an inherent value creation capacity and provides the most significant baseline for analysing, understanding and planning for our business going forward. It is a primary depiction of the resilient nature of our business and lends validity to the efficacy of our future focused transformational strategies that were premised on ever increasing aggression on cost models, debt structure, automation of our reservations and revenue management platforms.

REVIEW OF STRATEGYOur business is run on several strategic imperatives that I shall briefly review.

The US$3.13 million impairment of the investment in Dawn Properties Limited (Dawn) resulting from marking the investment to market and a loss of US$1.91 million from the new operations in Ghana were the major drivers of our loss reported for the year under review. These significant amounts affected our performance on the strategic pillar from a potential 18% return to minus 29% in the year under review. I must hasten to note that the disposal of our Dawn stake of 16.54% has begun and will be seen through at the special price of US$0.0147, which will lead to a full reversal of the impairment that went through in the year under review.

It is an imperative of the measure of our hotels’ competitiveness and ultimately profitability that they perform only within the top three (3) by RGI in the markets we operate.

The bulk of our hotels were within the top 3 in their comparator markets in the past period. Beitbridge Express Hotel operating in a fast falling and oversubscribed market, The Elephant Hills Resort and Conference Centre reeling from conferencing cancellations and postponements and The Kingdom at Victoria Falls that was mostly affected by the EVD cancellations and postponements missed the top 3 by RGI spot.

The success enjoyed by the rest of our hotels on this metric emanated from the completion of our extensive refurbishment program and is corroborated by the up-swing in overall guest satisfaction score that went up to 88% from 86% from prior period; well past our 85% lower threshold benchmark.

This strong EBITDA performance demonstrates an inherent value creation capacity and provides the

most significant baseline for analyzing, understanding and

planning for our business going forward.



Bankable leases Progress towards the strategic impetus to secure all our leases stalled in the reported period, even though it is noteworthy that the leases for the Harare and Bulawayo Holiday Inns where successfully notarised.

Significant Shareholder level developments for African Sun Limited and Dawn have made the interest in both businesses a symbiotic matter, reducing but not eliminating the impetus upon which the need to notarise leases was born.

Our Nigerian operations remain on limited liability management contracts basis in cognizance of the market risk that still prevails whilst the Ghana lease gives us confidence of bankability.

Investment in growth citiesOur growth footpath is mainly restricted to growth cities where we believe we can operate Hotels profitably and sustainably.

To this extent, we have identified hotels in our portfolio that have deviated from this Growth imperative that we are currently closely nursing and monitoring. We may have to divest from them soon if their fortunes do not turn around.

We consider Accra, Ghana and Lagos, Nigeria sprawling African growth cities. The Ghana, Accra hotel that was opened for the greater part of the period under review typifies our growth city footpath imperative. Our pre-opening teams were deployed to Lagos, Nigeria at the end of the period under review to undertake pre-opening works at a new project. The hotel; which we recently opened on a management contract basis on 15 December 2014 is still in its ‘soft-opening’ phase.

Going forward, we envisage that our investment and divesting analysis and decisions will continue to strictly hinge on this as well as other key performance considerations.

Talent bench strengthOur business is our people and hence can only be future sustainable if we are continuously investing in our people.

We have no less than our minimum threshold two (2) times succession cover for all critical “operations” roles giving us confidence that we would not close business due to talent gaps. We recorded a sub 2% staff turnover rate in the past period signifying stability that yields to the pragmatism and prudence of our unreduced financial investment in our broad based staff development programs suite in the reported period at a time austerity often directs reduced financial investment in people.

Our employee wellness drive was further embedded as general awareness was uplifted and relevant support interventions were monitored at Board level.

BUSINESS OVERVIEW Foreign arrivals grew by a consolidated 6% from same period last year. The growth was recorded from Japan (+37%), USA (+24%), Germany (+20%) and UK (+5%) with declines recorded from France (-10%), China (-32%) and Australia (-12%). Rest of Africa was impacted by South Africa, which reported a decline of 17%. The current outbreak of the EVD has affected travel to Africa and in particular West Africa due to the misperceptions about the risk of transmission to the non-affected parts of Africa.

The growth in foreign arrivals translated to a 6% increase in revenue from our three hotels in Victoria Falls. As these hotels constitute a significant 39% of our Zimbabwe rooms stock, it is imperative that we continue to focus on this destination as we seek to grow overall Group revenue.

Occupancy remained flat on last year at 48%, as an 8% increase in rooms capacity was offset by an increase in actual rooms sold. Rooms capacity increased following the opening of a new hotel in Ghana and the release of refurbished rooms in Zimbabwe. Consequently, RevPAR receded by 2%, a margin that was equal to the reduction in ADR. The reduction in ADR was largely a result of the contraction in the Zimbabwe domestic market, as liquidity challenges persisted during the year under review.

FINANCIAL REVIEW Revenue increased by 1.3% to US$56.72 million up from US$55.97 million achieved last year. The increase is fully attributed to the revenue contribution of African Sun Amber Hotel Accra Airport (i.e. 3.8 % of revenue), which was opened during the year albeit it is still to achieve full potential. On a like for like basis (i.e. excluding the new Ghana hotel), revenue decreased by 2.5% on last year.

Gross profit remained flat compared to last year as cost of sales grew by 4% with the addition of the new hotel. Operating costs reduced by 4.7%, resulting in a saving of US$1.8 million compared to prior year as cost reduction measures begin to bear fruit. Resultantly, EBITDA increased by 70% to US$6.95 million up from US$4.095 million achieved last year, whilst operating profit grew by 134% to US$3.25 million up from $1.38 million last year.


Financing costs charged to statement of comprehensive income increased by 15% from US$3.07 million last year to US$3.53 million, due to the fact that interest on refurbishment loans is no longer being capitalized (but charged to the statement of comprehensive income) following completion of hotel refurbishments. No borrowing costs were capitalized during the year compared to US$1.05 million capitalized in the prior year. These costs will reduce as the anticipated debt restructuring and reduction initiatives gather momentum in the coming year.

In order to comply with the requirements of IFRS 13, ”Fair Value Measurements”, the investment in Dawn Properties Limited, which is classified as a “non-current asset held for sale” was marked to market (US$0.009 per linked unit) at the reporting date, resulting in an impairment charge of US$3.13 million. The impairment is likely to be reversed in the ensuing financial year as the disposal of the investment at the agreed transaction price of US$0.0147 per linked unit is consummated.

The Group reported a loss for the year of US$2.29 million, which was an improvement of 74% from a restated loss of US$8.83 million incurred last year.

SIGNIFICANT FINANCIAL MATTERS

The directors approved the disposal of the staff housing on a sale and lease back basis in order to help reduce borrowings. The fixed property was carried at US$4.05 million at 30 September 2014.

Reclassification of non-distributable reserves to accumulated lossesDuring the year under review, the directors passed a resolution to reclassify non-distributable reserves amounting to US$4.61 million to accumulated losses. The movements have been shown separately in the group statement of changes in equity.

The Group restated its financial statements for the year ended 30 September 2013. The restatement arose from errors relating to treatment of pre-opening operating costs including occupational lease costs (rent) paid in line with the lease agreement, during the fit out period for the new hotel in Ghana. The rent had been included as part of minimum lease payments which are capitalised and are amortised over the remaining lease period upon interpreting IAS 17, “Leases”. This treatment has now been considered incorrect. As such the occupational rent paid during the prolonged fit out stage should have been expensed when it was incurred.

It was the Group’s policy to capitalise pre-opening costs and write them off in the first year of operation. Therefore, the pre-opening operating costs for 2013 for the new hotel in Ghana were treated in line with this policy. This policy contravenes the requirements of the International Financial Reporting Standards, hence the need to restate the financial statements.

The financial impact of the restatement increased the loss for the financial year ended 30 September 2013 to US$8.83 million from the US$6.57 million previously reported.

OUTLOOKThe domestic market is envisaged to remain depressed, exerting further pressure on rates and margins. This will however be mitigated by a forecasted growth in ADR and RevPAR driven by foreign arrivals. To this extent, focus will go towards improving marketing efforts in the traditional source markets.

As we look to the end of 2015, growth in profitability will be driven by: �� ^mjl`]j�]^^gjlk�lg�j]\m[]�[gkl�g^�kYd]k�Yf\�gh]jYlaf_�[gklk3�� _jgol`�af�l`]�[gfljaZmlagf�^jge�l`]�?`YfY�k]_e]fl3�� aehjgn]\�^gj]a_f�YjjanYdk$�eYafdq�af�l`]�j]kgjl�`gl]dk3�Yf\�� ^mjl`]j�\]Zl�j]\m[lagf& In spite of the worsening trading conditions experienced in the first quarter of the 2015 financial year, notable improvements in performance have been realised, with revenue growing by 12% over prior year, as the revenue contribution from the new Ghana hotel increased to 10%, up from 4% achieved in the full year to 30 September 2014.

S A Munyeza



Crowne Plaza Monomotapa, Harare


African Sun Limited is dedicated to achieving meaningful and responsible reporting through comprehensive disclosure and explanation of its financial results. This is done to ensure objective corporate performance measurement, to enable returns on investment to be assessed against the risks inherent in their achievement and to facilitate appraisal of the full potential of the Group.

The core determinant of meaningful presentation and disclosure of information is its validity in supporting management’s decision-making process. While the accounting philosophy encourages the pioneering of new techniques, it endorses the fundamental concepts underlying both the financial and management accounting disciplines as enunciated by the Public Accountants and Auditors Board of Zimbabwe (“PAAB”), the Institute of Chartered Accountants of Zimbabwe (“ICAZ”), the International Accounting Standards Board (“IASB”) and the International Federation of Accountants (“IFAC”). The Group is committed to the regular review of financial reporting standards and to the development of new and improved accounting practices. This is practised to ensure that the information reported to management and stakeholders of the Group continues to be internationally comparable, relevant and reliable. This includes, wherever it is considered appropriate, the early adoption of financial reporting standards.

The Group adopts all accounting standards and interpretations applicable that are issued by the IASB and the International Financial Reporting Interpretations Committee (“IFRIC”). Unless otherwise stated, these standards are applied consistently to enhance comparability of financial information relating to different financial periods.

Hwange Safari Lodge, Hwange


CERTIFICATE BY THE GROUP COMPANY SECRETARY

EDWIN SHANGWAGroup Company Secretary

I the undersigned, in my capacity as the Group Company Secretary, hereby confirm, to the best of my knowledge and belief, that for the financial year ended 30 September2014, the Company has complied with Zimbabwe Stock Exchange Listing Requirements, lodged with the Registrar of Companies all returns required of a public company in terms of the Zimbabwe Companies Act (Chapter 24:03) and that all such returns are true, correct and up to date.


The directors present their Annual Report and the Audited Financial Statements of the Company and the Group for the year ended 30 September 2014. YEAR’S RESULT US$ US$EBITDA Loss for the year Headline earnings / (loss)

DIVIDENDS No dividend was declared for the year ended 30 September 2014 (2013: US$nil).

CAPITAL COMMITMENTS US$ US$

Authorised by directors and contracted for - 630 042Authorised by directors but not contracted for 4 490 080 4 872 268Total Commitments

INVESTMENTSThe Company holds equity investments in the following entities to the extent indicated below:African Sun Limited PCC (Mauritius) 100.00%African Sun Zimbabwe (Private) Limited 100.00%Dawn Properties Limited 16.54%RCI Zimbabwe (Private) Limited 24.00%

SHARE CAPITALThere were no changes to the issued share capital which stands at 831 472 907 ordinary shares. The issued share capital and share premium total US$33 049 033. The number of unexercised ordinary shares currently under the employee share option scheme total 32 926 655. No additional shares were issued as at 30 September 2014.

RESERVESThe movement in the reserves of the Group is shown in the Group statement of changes in shareholders’ equity and in the relevant notes to the financial statements.

DIRECTORSMr S. Cranswick resigned on 17 November 2014. Ms T. Ndebele, Messrs H. Nkala and G. Manyere were appointed to the board on 24 November 2014. They retire at the end of their interim appointments. All being eligible, they will offer themselves for re-election at the Annual General Meeting. Mr E. Fundira and Ms N. Maphosa retire by rotation. Both being eligible, they will offer themselves for re-election at the Annual General Meeting.

INDEPENDENT AUDITORMembers will be asked to re-appoint PricewaterhouseCoopers Chartered Accountants (Zimbabwe) as independent auditor of the Group for the ensuing year.

ANNUAL GENERAL MEETINGThe Forty Third Annual General Meeting of Shareholders of African Sun Limited will be held in the Kariba Room at Holiday Inn Harare, Corner 5th Street and Samora Machel Avenue, Harare on Tuesday, 31 March 2015 at 1100 hours.

By Order of the Board:

DIRECTORS’ REPORT


THE AFRICAN SUN CHARTERAfrican Sun Limited personnel are committed to a long-published code of ethics which runs through the whole Group in all the jurisdictions in which it operates. This incorporates the Group’s operating, financial and behavioural policies in a set of integrated values, including the ethical standards required of members of the African Sun Limited family in their interface with one another and with all stakeholders.

There are detailed policies and procedures in place across the Group, covering the regulation and reporting of transactions in securities of the Group by the directors and officers. The Group adopted a Corporate Governance Charter and certain recommendations made in the King Report III.

THE NATIONAL CODE ON CORPORATE GOVERNANCE In line with the Group’s continued drive towards better corporate Governance, the Group closely monitors the developments in Zimbabwe on the framing of the National Code on Corporate Governance, which has been in the pipeline for the past two years. In this regard there is a commitment to ensure that when it is finally in force, regard will also be given to this code as the Group continues with its drive for best practices in Corporate Governance.

STAKEHOLDERSFor many years, African Sun Limited has had a formalised stakeholder philosophy and structures of corporate governance to manage the interface with the various stakeholder groups. African Sun Limited has in place responsive systems of governance and practice, which the Board and management regard as appropriate to ensure that our commitment to good governance remains underpinned by the pillars of responsibility, fairness, transparency and accountability to all stakeholders. These pillars preserve our long-term sustainability, thereby delivering value to all stakeholders.

DIRECTORATEThe Board of directors of African Sun Limited is constituted by a majority of non-executive directors and meets at least quarterly. A non-executive director chairs the African Sun Limited Board.

DIRECTORS’ INTERESTSAs provided by the Zimbabwe Companies Act (Chapter 24:03) and the Company’s Articles of Association, the directors are bound to declare any time during the year, in writing, whether they have any material interest in any contract of significance with the Company, which could have given rise to a related conflict of interest. No such conflicts were reported this year.

INTERNAL CONTROLThe Board of directors is responsible for the Group’s systems of internal control. These systems are designed to provide reasonable, but not absolute, assurance as to the integrity and reliability of the financial statements and to safeguard, verify and maintain accountability of its assets and to detect and minimise significant fraud, potential liability, loss and material misstatement while complying with applicable laws and regulations.

The controls throughout the Group concentrate on critical risk areas. All controls relating to the critical areas in the casino and hotel operating environments are closely monitored by the directors and subjected to internal audit reviews. Furthermore, assessments of the information technology environment are also performed.

An Internal Audit Services Manager, who reports directly to the chairman of the Risk and Audit Committee, heads the Internal Audit department. The Internal Audit department is designed to serve management and the Board of directors through independent evaluations and examinations of the Group’s activities and resultant business risks.

BOARD MEETINGSThe Board meets at least four times per financial year in order to monitor, consider and review, inter alia, matters of a strategic, financial, non-financial and operational nature. Special Board meetings may be convened on an ad hoc basis, when necessary, to consider issues requiring urgent attention or decision. During the year under review, seven Board meetings were held.

The Board works to a formal agenda prepared by the Group Company Secretary in consultation with the Chairman and the Group Chief Executive, which, inter alia, covers operations, finance, capital expenditure, acquisitions and strategy. Any Board member may request the addition of an item to the agenda and will liaise with the Group Company Secretary in this regard. Board papers comprising the agenda, minutes of Board and Board committee meetings and the relevant supporting documentation are circulated to all directors in advance of each meeting in order that they can adequately prepare and participate fully, frankly and constructively in Board discussions and bring the benefit of their particular knowledge, skills and abilities to the meeting.

CORPORATE GOVERNANCE


CORPORATE GOVERNANCE (continued)

BOARD COMMITTEESThe Board is authorised to form committees to assist in the execution of its duties, powers and authorities. The Board has five standing committees, namely: Risk and Audit, Human Resources and Remuneration, Finance and Investments, Marketing and Nominations. In addition, there is the Corporate Governance Committee, which is an ad hoc committee. The terms of reference and composition of the committees are determined and approved by the Board and have been adopted by the Board on an annual basis.

THE RISK AND AUDIT COMMITTEEThe Risk and Audit Committee deals, inter alia, with compliance, internal control, information technology governance and risk management. It is regulated by specific terms of reference, chaired by a non-executive director, has at least two non-executive directors and incorporates the Group Chief Executive and Group Finance Director as members. It meets with the Company’s independent auditor to discuss accounting, auditing, internal control and financial reporting matters. The independent and internal auditors have unrestricted access to the Risk and Audit Committee.

THE HUMAN RESOURCES AND REMUNERATION COMMITTEEThe Group has a Human Resources and Remuneration Committee, which is made up of a non-executive Chairman, the Group Chief Executive and at least one non-executive director. The committee acts in accordance with the Board’s written terms of reference to review remuneration of all African Sun Limited executive directors, senior management and other members of staff.

THE FINANCE AND INVESTMENTS COMMITTEEThe Group has a Finance and Investments Committee, which is made up of a non-executive Chairman, the Group Chief Executive, Group Finance Director and at least one non-executive director. It is chaired by a non-executive director. The committee is responsible for the review and preliminary approval of the major investment and financing decisions of the Company.

THE MARKETING COMMITTEEThe Group has a Marketing Committee comprising, a non-executive Chairman, the Group Chief Executive and at least one non-executive director. The committee is responsible for the review of all sales and marketing programmes of the Group.

THE NOMINATIONS COMMITTEEThe Nominations Committee is now a standing, as opposed to an ad hoc, committee, pursuant to the recommendations made in the King III Report. It is made up of a non-executive Chairman, the Group Chief Executive, and at least one non-executive director. It assists with the identification and recommendations of potential directors to the Board.

CORPORATE GOVERNANCE COMMITTEEThe Corporate Governance Committee is an ad hoc committee, which sits as and when it is necessary. It is made up of a non-executive Chairman, the Group Chief Executive and two other non-executive directors.

NATIONAL WORKS COUNCIL AND WORKERS’ COMMITTEESThe Group holds National Works Council meetings at least twice a year. Each hotel within the Group has a Works Council representative who attends these meetings, which is a forum where employees participate in the decision-making process and also discuss employees’ concerns, with top management. The Group believes in and practices worker participation throughout the different levels. All hotels have Workers’ Committees, which serve as a communication channel with shop floor employees.

ANALYST BRIEFINGThe Group reports formally to shareholders twice a year when its half and full year results are announced. The Group Chief Executive and the Group Finance Director give presentations on these results to institutional investors, analysts and the media. The data used in these presentations may be found at www.africansunhotels.com

ANNUAL GENERAL MEETINGThe Annual General Meeting provides a useful interface with private shareholders, many of whom are also customers.

The Chairman of the Board, the Group Chief Executive and the Group Finance Director are available at the Annual General Meeting to answer questions. Information about the Group is maintained and available to shareholders at www.africansunhotels.com


Main Board

Finance and Investments Committee

Marketing Committee

Risk and Audit Committee

Human Resources and Remuneration

Committee

Number of meetings 4 4 5 4

B. L. Nkomo 7 - - - -

S. A. Munyeza 7 3 4 3

D. W. Birch* 3 - 2 2

S.P.Cranswick**/*** 5 - 3 - 3

E. A. Fundira 7 4 2 - -

W. T . Kambwanji** 6 - - 2 2

V.W. Lapham* 3 2 - 3 -

A. Makamure 6 4 - 2 2

N. Mangwiro 7 - 3 5 4

N.G. Maphosa 7 - - - 4

T .Nuy** 5 2 - - -

N.R. Ramikosi 7 - 4 - 4

H.Nkala** - - - - -

T.Ndebele** - - - - -

G.Manyere** - - - - -

* Messrs D. W. Birch and V. W. Lapham resigned from the board on 21 March 2014.** Messrs S. P. Cranswick, T. Nuy and W. Kambwanji were appointed to the board on 24 January 2014. Messrs G. Manyere and H. Nkala as well as Ms T. Ndebele were appointed to the board on 24 November 2014. *** Mr S. P. Cranswick resigned from the board on 17 November 2014.


Individual director attendance at Board and Committee meetings appears in the table below. Where a director has not been able to attend a Board meeting, any comments, which he or she had arising out of the papers to be considered at that meeting, have been relayed in advance to the Chairman of the Board.

The Group recognizes the importance of Information Systems and the need to co-opt the systems into the strategy of the business with the risks involved in Information Technology Governance becoming significant. The King III Report has highlighted that there are operational risks when one deals with a service provider because confidential information leaves the Group exposed. In IT governance, the Company seeks confidentiality, integrity and availability of the functioning of the system, authenticity of system information and assurance that the system is usable and useful. In this regard, in exercising the duty of care, directors ensure that prudent and reasonable steps have been taken in respect to IT governance.


PRINCIPLES RELATING TO IT GOVERNANCEIn monitoring implementation and adherence to proper IT Governance the Group is guided by the following principles;

This includes establishing and promoting an ethical governance culture as well as gaining independent assurance on the effectiveness of the internal controls. The structures, processes and mechanisms that are required and guided by the IT governance framework are implemented, controlled and monitored by management who have suitable experience and qualifications to do the same. In summary, the responsibility of the Board entails;�� <aj][lagf3�� =nYdmYlagf3�Yf\�� Egfalgjaf_�g^�l`]�mk]�g^�AL�lg�kmhhgjl�Zmkaf]kk�kljYl]_q&

IT plays a support function to the Group’s business and assists business in reaching its strategic objectives and goals. Business goals are cascaded into IT goals that in turn are translated into IT processes and procedures. Through effective controls, IT ensures that its processes are aligned to the business objectives, which in turn ensure that the business operates in a sustainable and well-governed manner. Management has implemented strategic IT planning processes that are integrated with the business strategy development process.

The Board delegates to management the responsibility for the implementation of an IT governance framework into the Group, while still retaining accountability for overall IT governance.

The Board’s responsibilities include:�� Egfalgjaf_�Yf\�]nYdmYlaf_�l`]�]pl]fl�lg�oà[`�AL�Y[lmYddq�kmklYafk�Yf\�]f`Yf[]k�l`]�?jgmhÌk�kljYl]_a[�gZb][lan]k3�� Egfalgjaf_�Yf\�]nYdmYlaf_�l`]�Y[imakalagf�Yf\�mk]�g^�AL�j]kgmj[]k�lg�]fkmj]�l`Yl�l`]q�kmhhgjl�Zmkaf]kk�j]imaj]e]flk3�� Egfalgjaf_�Yf\�]nYdmYlaf_�l`]�Y[imakalagf�Yf\�YhhjghjaYl]�mk]�g^�l][`fgdg_q$�hjg[]kk]k�Yf\�h]ghd]3�Yf\�� Gn]jk]]af_�AL�afn]kle]fl�lg�]fkmj]�l`Yl�AL�]ph]f\almj]�ak�af�hjghgjlagf�lg�l`]�\]dan]jq�g^�Zmkaf]kk�nYdm]&

Risk identification does not rely solely on the perceptions of a select group of managers. The Group adopts a thorough approach to risk identification with consideration being given to reputation risk and IT legal risks.

According to King III, “information security deals with the protection of information, in its electronic and paper-based forms, as it progresses through the information lifecycle of capture, processing, use, storage, and destruction”. For this reason, the Group’s information security has been designed to address people, processes and technology related dimensions.The key core principles of information security that the Group abides by are encapsulated in the following three components;�� ;gfâ\]flaYdalq�%�]fkmjaf_�l`Yl�af^gjeYlagf�ak�Y[[]kkaZd]�gfdq�lg�l`gk]�Yml`gjak]\�lg�`Yn]�Y[[]kk3�� Afl]_jalq�Ç�kY^]_mYj\af_�l`]�Y[[mjY[q�Yf\�[gehd]l]f]kk�g^�af^gjeYlagf�Yf\�hjg[]kkaf_�e]l`g\k3�Yf\�� 9nYadYZadalq�%�]fkmjaf_�l`Yl�Yml`gjak]\�mk]jk�`Yn]�Y[[]kk�lg�af^gjeYlagf�Yf\�hjg[]kkaf_�e]l`g\k&

The Risk and Audit Committee assists the Board in carrying out its IT responsibilities as follows;�� L`]�Jakc�Yf\�9m\al�;geeall]]�]fkmj]k�l`Yl�AL�jakck�Yj]�Y\]imYl]dq�Y\\j]kk]\3�� L`]�Jakc�Yf\�9m\al�;geeall]]�[gfka\]jk�AL�Yk�al�j]dYl]k�lg�âfYf[aYd�j]hgjlaf_�Yf\�l`]�_gaf_�[gf[]jf�g^�l`]�?jgmh3�� L`]�Jakc�Yf\�9m\al�;geeall]]��gZlYafk�YhhjghjaYl]�YkkmjYf[]�l`Yl�[gfljgdk�Yj]�af�hdY[]�Yf\�]^^][lan]�af�Y\\j]kkaf_� IT risks; and�� L`]�Jakc�Yf\�9m\al�;geeall]]��[gfka\]jk�l`]�mk]�g^�l][`fgdg_q�lg�aehjgn]�Ym\al�[gn]jY_]�Yf\�]^â[a]f[q&



Elephant Hills Resort and Conference Centre, Victoria Falls


African Sun Limited directors are required by the Zimbabwe Companies Act (Chapter 24:03) and the Zimbabwe Stock Exchange Listing Requirements, to maintain adequate accounting records and to prepare financial statements for each financial year which present a true and fair view of the state of affairs of the Group at the end of the financial year, and of the profit or loss and cash flows for the year then ended. In preparing the financial statements, generally accepted accounting practices have been followed and suitable accounting policies have been used and applied consistently. Reasonable and prudent judgements and estimates have been made. The financial statements incorporate full and responsible disclosure in line with the accounting philosophy of the Group stated on page 19.

The directors have reviewed the Group’s budget and cash flow forecast for the twelve months to 30 September 2015. On the basis of the review of the operating forecasts and in light of the current financial position and existing borrowing facilities, the directors are satisfied that African Sun Limited is a going concern and have continued to adopt the going concern basis in preparing the financial statements. The Group’s Independent auditor, PricewaterhouseCoopers Chartered Accountants (Zimbabwe), have audited the financial statements and their report appears on page 29.

The Group has an internal audit department, which has the objective of assisting executive management and the Risk and Audit Committee in the discharge of their responsibilities, and which monitors the effectiveness of the accounting system and related internal financial controls on a continuing basis. The internal audit department performs a critical examination of the financial and operating information for management, and reports its findings and its recommendations to management and to the Risk and Audit Committee.

Procedures are in place to identify key business risks timeously, to determine the likelihood of the risks crystallising, and to determine the significance of the consequential financial impact on the business.

The Risk and Audit Committee meets quarterly with management, the internal audit department and the independent auditor, to review specific accounting, reporting and internal control matters, and to satisfy itself that the system of internal control is operating effectively. Both the internal and independent auditors have unlimited access to the Risk and Audit Committee. The Committee also reviews the interim and annual results of the Group prior to their publication.

The Risk and Audit Committee also reviews the IT governance framework and monitors the IT function against the risk and performance imperatives. In exercising their duty of care, the Committee ensures that prudent and reasonable steps have been taken in regard to IT governance.

In addition, the Group’s independent auditor reviews and tests appropriate aspects of the internal financial control systems during the course of their statutory audit of the financial statements of the Group.

The Group’s Risk and Audit Committee has met the internal and the independent auditor to discuss their reports on the results of their work, which include assessments of the relative strengths and weaknesses of key control areas.

In a Group of the size, complexity and geographical diversity of African Sun Limited, it may be expected that occasional breakdowns in established control procedures may occur. No breakdowns involving material loss have been reported to the directors in respect of the year under review and it is believed that none of any significance exists.

The financial statements for the year ended 30 September 2014 which appear on pages 31 to 101 have been approved by the Board of Directors and are signed on their behalf by:

DIRECTORS’ RESPONSIBILITY FOR FINANCIAL REPORTING

INDEPENDENT AUDITOR’S REPORTTO THE SHAREHOLDERS OF AFRICAN SUN LIMITED We have audited the consolidated financial statements of African Sun Limited and its subsidiaries (the “Group”), and the accompanying statement of financial position of African Sun Limited (‘the Company’) standing alone, together the “financial statements”, which comprise the consolidated and separate statements of financial position as at 30 September 2013, and the consolidated statements of comprehensive income, changes in equity and of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information set out on pages 44 to 109. 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 the manner required by the Zimbabwe Companies Act (Chapter 24:03) and the relevant Statutory Instruments (“SI”) SI 33/99 and SI 62/96 and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s responsibilityOur 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 about 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 auditor’s 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 auditor considers internal control relevant to the entity’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 entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, 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. OpinionIn our opinion, the financial statements present fairly, in all material respects, the financial position of the Group and the Company as at 30 September 2013, and the Group’s consolidated financial performance and its consolidated cash flows for the year then ended, in accordance with International Financial Reporting Standards and in the manner required by the Zimbabwe Companies Act (Chapter 24:03) and the relevant Statutory Instruments SI 33/99 and SI 62/96.

PricewaterhouseCoopers Chartered Accountants (Zimbabwe)Harare23 January 2014

INDEPENDENT AUDITOR’S REPORT TO THE SHAREHOLDERS OF AFRICAN SUN LIMITED We have audited the consolidated financial statements of Africa Sun Limited and its subsidiaries (“together the Group”), and the statement of financial position of African Sun Limited (the “Company”), standing alone, (“the financial statements”) which comprisethe consolidated and separate statements of financial position as at 30 September 2014 and the consolidated statement of comprehensive income, changes in equity and cash flows for the year then ended, and notes comprising a summary of significantaccounting policies and other explanatory information set out on pages 31 to 101.

The Company’s directors are responsible for the preparation and fair presentation of these financial statements in accordance withInternational Financial Reporting Standards and in the manner required by the Zimbabwe Companies Act (Chapter 24:03), and therelevant Statutory Instruments (“SI”) SI 33/99 and SI 62/96 and for such internal control as the directors determine is necessary toenable the preparation of financial statements that are free from material misstatements, whether due to fraud or error.

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit inaccordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about 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 auditor’s judgement, including the assessment of the risks of material misstatement of thefinancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controlrelevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internalcontrol. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accountingestimates made by management, 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.

In our opinion, the financial statements present fairly, in all material respects, the consolidated and separate financial position ofthe Group and the Company as at 30 September 2014, and the Group’s consolidated financial performance and its consolidatedcash flows for the year then ended in accordance with International Financial Reporting Standards and in the manner required bythe Zimbabwe Companies Act (Chapter 24:03) and the relevant Statutory Instruments (“SI”) SI 33/99 and SI 62/96.

PricewaterhouseCoopers Chartered Accountants (Zimbabwe) Harare 9 March 2015

Caribbea Bay Resort, Kariba


Note US$ US$

US$Restated

US$Restated

US$

ASSETS

Non-current assetsProperty and equipment 2 058 890 27 678 255 32 116 383 26 566 875 Biological assets - - 253 715 220 651 274 678 Equity accounted investments 11 - - - 6 067 253 17 588 834 Other investments 11 30 676 796 - - - Deferred income tax assets 23 246 298 1 251 171 499 880 - Trade and other receivables 15 526 374 612 046 526 374 238 665

Current assetsInventories 14 51 999 1 644 492 1 643 661 1 472 627 Trade and other receivables 15 1 072 583 6 534 276 8 176 350 8 741 095 Cash and cash equivalents(excluding bank overdrafts) 16 989 319 2 734 576 4 229 079 4 603 809

2 113 901 10 913 344 14 049 090 14 817 531 Non-current assets held for sale 12 4 224 720 7 347 178 4 354 381 -

Total assets

EQUITY AND LIABILITIES

Equity attributable to owners of theparentShare capital 8 314 729 8 314 729 8 314 729 8 314 729Share premium 24 734 304 24 734 304 24 734 304 24 734 304 Other reserves - ( 753 203) 1 273 921 5 135 328 5 135 328 Equity settled share based payments reserve 20 171 100 856 20 171 - Foreign currency translation reserve - - (2 508 994) (1 068 658) (1 038 566)Revaluation reserve - - - 249 706 430 871 Accumulated losses (7 990 247) (21 351 348) (23 132 766) (14 303 293)

Total equity

LIABILITIES

Non-current liabilitiesTrade and other payables 1 758 132 2 203 358 1 758 132 - Borrowings 22 - 6 742 795 8 093 067 6 443 381 Deferred income tax liabilities 23 - - 4 536 415 4 604 007 4 080 590

Current liabilitiesTrade and other payables 5 479 361 12 530 088 13 784 156 10 621 284 Provisions for other liabilities 21 215 444 873 635 1 113 930 1 418 073 Borrowings 22 8 068 288 10 605 950 14 227 906 13 649 882

Total liabilities 15 521 225

Total equity and liabilities

These financial statements on pages 31 to 101 were approved by the Board of Directors on 27 January 2015 and signed on their behalf by:

STATEMENT OF FINANCIAL POSITIONAs at 30 September 2014

GROUPCOMPANY


Note US$Restated

US$

Revenue 5 Cost of sales 26

Other income 25 111 526 - Operating expenses 26 ( 38 783 357) Other expenses 25 ( 499 708)

Finance costs - net ( 3 072 787) Finance income 5 723 Finance costs ( 3 078 510) Fair value adjustment and impairment of assets classified as held for sale 11 ( 7 627 895) Recycled from other comprehensive income 181 165 Share of profit of investments accounted for using the equity method 11 331 034

Loss before income tax Income tax credit / (expense) 23 ( 23 537)

Loss for the year

Foreign currency translation differences ( 30 093) Comprehensive income from associate recycled to profit and loss ( 181 165)

( 211 258)

Attributable to: Owners of the parent

Basic (1.07) Diluted (1.04)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMEFor the year ended 30 September 2014


Share

US$

Share

US$

Treasury shares

US$

Non-distributable

reserve US$

Equity settledshare based

reserve US$

Foreigncurrency

translationreserve

US$

Revaluationreserve

US$

Accumulated losses

US$

Totalequity

US$

8 239 409 24 056 421 - 5 888 531 - (946 582) 430 871 (14 788 708) 22 879 942

Effects of changes in accounting policy (note 6) - - - - - (91 984) - 485 415 393 431

Reclassification of treasury shares (note 17.2) 75 320 677 883 (753 203) - - - - - -

Balance as at 30 September 2012, as restated 8 314 729 24 734 304 (753 203) 5 888 531 - (1 038 566) 430 871 (14 303 293) 23 273 373

Loss for the year, as previously stated - - - - - - - (6 568 454) (6 568 454)

Effects of changes in accounting policy (note 6) - - - - - - - ( 97 895) (97 895)

Effects of correcting the prior period error (note 7) - - - - - - - ( 2 163 124) (2 163 124)

Loss for the year - - - - - - - ( 8 829 473) (8 829 473)

Currency translation differences - - - - - (30 092) - - (30 092)

Reclassified to profit or loss - - - - - (181 165) - (181 165)

Total comprehensive loss for the year - - - - - (30 092) (181 165) - (211 257)

Transaction with owners:

Value of employee services - - - - 20 171 - - - 20 171

Balance as at 30 September 2013 as restated 8 314 729 24 734 304 (753 203) 5 888 531 20 171 (1 068 658) 249 706 (23 132 766) 14 252 814

8 314 729 24 734 304 (753 203) 5 888 531 20 171 (1 068 658 249 706 (23 132 766) 14 252 814

Loss for the year - - - - - - - (2 285 702) (2 285 702)

Currency translation differences - - - - - (1 440 336) - - (1 440 336)

Recycled to profit or loss - - - - - (249 706) - (249 706)

Transfer to accumulated losses (note 19.5) - - - (4 614 610) - - - 4 614 610 -

Total comprehensive loss for the year - - - (4 614 610) - (1 440 336) (249 706) 2 328 908 (3 975 744)

Transactions with owners:

Proceeds from disposal of treasury shares - - 205 713 - - - - - 205 713

Loss from disposal of treasury shares - - 547 490 - - - - (547 490) -

Value of employee services - - - - 80 685 - - - 80 685

Total transactions with owners - - 753 203 - 80 685 - - (547 490) 286 398

- -

For the year ended 30 September 2014CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

GROUP


Note US$Restated

US$

Cash generated from operations 8 082 572 Interest received 5 723 Interest paid - including borrowing costs capitalised ( 3 748 218)

Net cash generated from operating activities

Cash flows from investing activitiesPurchase of property and equipment - excluding borrowing costs capitalised ( 6 953 072)Proceeds from sale of property and equipment 62 821 Proceeds from sale of non-current assets held for sale 12 - Dividend received -

Net cash generated from / (used in) investing activities

Cash flows from financing activitiesProceeds from disposal of treasury shares - Proceeds from short-term borrowings 1 400 820 Proceeds from long-term borrowings 4 144 210 Deposit utilised from debt service reserve account 195 691 Repayment of short-term borrowings ( 494 927)Repayment of long-term borrowings ( 2 494 524)

Net cash (used in) / generated from financing activities

201 096

Cash and cash equivalents at beginning of year 1 459 663 Exchange losses on cash and cash equivalents ( 52 636)

Cash and cash equivalents at end of year 16

CONSOLIDATED STATEMENT OF CASHFLOWSFor the year ended 30 September 2014


1 GENERAL INFORMATION African Sun Limited (“the Company”) and its subsidiaries (together, “the Group”) leases and manages hotel properties. The

Group has operations in Ghana, Nigeria, South Africa and Zimbabwe. The Group leases twelve hotels in Zimbabwe, and one in Ghana which was opened in December 2013. In Nigeria, the Group manages four hotels under management contracts. In South Africa the Group operates a regional sales office which focuses on international sales.

The Company is a public limited company, which is incorporated and domiciled in Zimbabwe and listed on the Zimbabwe Stock Exchange.

The address of its registered office is African Sun House, Number 6 Seagrave Road, Mount Pleasant, Harare, Zimbabwe.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The principal accounting policies applied 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.

The Group’s financial statements have been prepared in accordance with International Financial Reporting Standards, (“IFRS”) and the International Financial Reporting Interpretations Committee, (“IFRIC”) interpretations applicable to companies reporting under IFRS and in the manner required by the Zimbabwe Companies Act (Chapter 24:03) and the relevant Statutory Instruments (“SI”) SI 33/99 and SI 62/96. The financial statements have been prepared under the historical cost convention as modified by the revaluation of biological assets, property and equipment and non-current assets held for sale.

The preparation of financial statements in conformity to IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 4.

The Group’s EBITDA grew positively by 70% in the period under review, consolidating a discernible growth trend averaging 5% per annum since 2012. This attribute of resilience defied a generally receding operating environment. The EBITDA growth trend has demonstrated the Group’s inherent value creation capacity. The Group repaid loans amounting to US$6.8 million resulting in a 46% decrease in the the net current liabilities position to US$5.75 million down from US$10.72 million reported last year. Looking ahead, the domestic market is envisaged to remain depressed, exerting further pressure on rates and margins, but we anticipate that this will be ameliorated by: �� Y�^gj][Ykl]\�_jgol`�af�^gj]a_f�YjjanYdk3� � � � � � � � �� _jgol`�af�l`]�[gfljaZmlagf�g^��l`]�j][]fldq�gh]f]\�`gl]d�af�?`YfY3� � � � � �� ^mjl`]j�]^^gjlk�lg�j]\m[]�[gkl�g^�kYd]k�Yf\�gh]jYlaf_�[gklk3�Yf\� � � � � � �� ^mjl`]j�\]Zl�j]kljm[lmjaf_�Yf\�j]\m[lagf&� � � � � � � � �

Based on the aforementioned, the directors have assessed the ability of the Group to continue operating as a going concern and are of the view that the preparation of these financial statements on a going concern basis is appropriate. The appropriateness of the going concern basis is premised on: �� L`]�kl]Y\q�aehjgn]e]fl�af�gh]jYlaf_�h]j^gjeYf[]�j][gj\]\�gn]j�l`]�dYkl�l`j]]�q]Yjk3�Y�lj]f\��l`Yl�ak�]ph][l]\�lg�� continue in the future; and �� L`]�[gfkmeeYlagf�g^�l`]�j][YhalYdakYlagf�Yf\�\]Zl�j]kljm[lmj]�afalaYlan]k$�Yfla[ahYl]\�Zq�l`]�]f\�g^�l`]�f]pl�^afYf[aYd�q]Yj&��

The key recapitalisation and debt reduction initiatives being pursued are outlined below: (i) Disposal of 16.54% Linked Units in Dawn Properties: the disposal is expected to raise US$5.8 million, which will be used to repay short-term loans. Part of the disposal was effected on the Zimbabwe Stock Exchange on 17 December 2014 with a total value of US$1 million. The rest of the disposal is expected to be completed by 30 September 2015.

(ii) Disposal of fixed property: the disposal is expected to raise US$4 million, which will be used to repay part of the short- term loans. Negotiations done to date show that the disposal is likely to go through before 30 September 2015.

For the year ended 30 September 2014NOTES TO THE FINANCIAL STATEMENTS


NOTES TO THE FINANCIAL STATEMENTSFor the year ended 30 September 2014

(iii) Sale of timeshare weeks –The Group has opted for a timeshare weeks resale by early maturing imminently expiring time

share weeks that range between 3 and 6 years to expiry. The total proceeds from this disposal are expected to be at least US$2.9 million and will be used to reduce borrowings.

(iv) Cost reduction – after achieving a significant saving of US$1.8 million in costs from the Zimbabwe operations during the financial year ended 30 September 2014, the Group is targeting further savings through various cost cutting initiatives.

The following new standards, amendments and interpretations are effective for accounting periods beginning on or after

1 January 2013 and are relevant to the Group;

Content

financial years beginning on/after

International Accounting Standard (“IAS”) 27 (amendment)

Separate Financial Statements 1 January 2013

IAS 28 (amendment) Associates and Joint Ventures 1 January 2013

IAS 32 (amendment) Financial Instruments: Presentation 1 January 2013

IAS 34 (amendment) Interim Financial Reporting 1 January 2013

IFRS 7 (amendment) Asset and Liability Offsetting 1 January 2013

IFRS 10 (new) Consolidated Financial Statements 1 January 2013

IFRS 11 (new) Joint Arrangements 1 January 2013

IFRS 12 (new) Disclosures of Interests in Other Entities 1 January 2013

IFRS 13 (new) Fair Value Measurement 1 January 2013

IFRS 10, 12 (amendment) Amendment to the Transition Requirements 1 January 2013

Annual improvements 2011 Improvements to various International Financial Reporting Standards

1 January 2013

IAS 27, ‘Separate Financial Statements’, revised and effective 1 January 2013. This standard includes the provisions on separate

financial statements that are left after the control provisions of IAS 27 have been included in the new IFRS 10.

IAS 28, ‘Associates and Joint Ventures’, revised and effective 1 January 2013. This standard includes the requirements for joint ventures, as well as associates, to be equity accounted following the issue of IFRS 11.

Amendment to IAS 32, ‘Financial Instruments: Presentation’ effective 1 January 2013. The amendment clarifies the treatment of income tax relating to distributions and transaction costs. The amendment clarifies that the treatment is in accordance with IAS 12 ‘Income Taxes’. So, income tax related to distributions is recognised in the income statement, and income tax related to the costs of equity transactions is recognised in equity.

Amendment to IAS 34, ‘Interim Financial Reporting’ effective 1 January 2013. The amendment brings IAS 34 into line with the requirements of IFRS 8, ‘Operating Segments’. A measure of total assets and liabilities is required for an operating segment in interim financial statements if such information is regularly provided to the Chief Operating Decision Maker (“CODM”) and there has been a material change in those measures since the last annual financial statements.

IFRS 7, ‘Financial Instruments: Disclosures’, Assets and Liability Offsetting, amended and effective 1 January 2013. The IASB has published an amendment to IFRS 7, reflecting the joint requirements with the Financial Accounting Standards Board (“FASB”) to enhance current offsetting disclosures. These new disclosures are intended to facilitate comparison between those entities that prepare IFRS financial statements to those that prepare financial statements in accordance with US GAAP.



The following new standards, amendments and interpretations are effective for accounting periods beginning on or after

1 January 2013 and are relevant to the Group; (continued)

IFRS 10 (new), “Consolidated Financial Statements”, effective 1 January 2013. This standard builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements. The standard provides additional guidance to assist in determining control where this is difficult to assess. This new standard might impact the entities that a group consolidates as its subsidiaries.

IFRS 11 (new) “Joint arrangements” effective 1 January 2013. This standard provides for a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form. There are two types of joint arrangements: joint operations and joint ventures. Joint operations arise where a joint operator has rights to the assets and obligations relating to the arrangement and hence accounts for its interests in assets, liabilities, revenue and expenses. Joint ventures arise where the joint operator has rights to the net assets of the arrangement and hence equity accounts for its interest. Proportional consolidation of joint ventures is no longer allowed.

IIFRS 12 (new) “Disclosures of Interests in Other Entities” effective 1 January 2013. IFRS 12 includes the disclosure requirements

for all forms of interest in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles.

IFRS 13 (new), “Fair Value Measurement”, effective 1 January 2013. This standard aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. The requirements, which are largely aligned between IFRSs and US GAAP, do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within IFRSs or US GAAP.

Improvements to IFRS were issued by the International Accounting Standard Board (“IASB”) to be applied for financial periods beginning 1 January 2013. They contain numerous amendments to IFRS that the IASB considered non urgent but necessary. Improvements to IFRS comprise amendments that result in accounting changes for presentation, recognition or measurement purposes, as well as terminology amendments related to a variety of individual IFRS standards.

The impact of adopting IFRS 11, “Joint Arrangements”, and IFRS12 “Disclosure of Interests in Other Entities” are disclosed in notes 6, 7 and 11. The impact of adopting IFRS13 “Fair Value Measurements” is disclosed in notes 8, 9 and 11.

All the other new standards, amendments and interpretations do not have a material impact on the financial statements of the Group.



A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2013, and have not been applied in preparing these consolidated financial statements. The following, set out below, are expected to have an effect on the consolidated financial statements of the Group;

Content


IFRS 9 (new) Financial Instruments 1 January 2018IFRS 10, IFRS 12 and IAS 27 (amendments)

Investment Entities 1 January 2014

IAS 32 (amendment) Asset and Liability Offsetting 1 January 2014IAS 36 (amendment) Disclosure 1 January 2014IAS 39 (amendment) Financial Instruments: Recognition and Measurement 1 January 2014IFRS 2 (amendment) Share Based Payments 1 July 2014IFRS (amendment) Operating Segments 1 July 2014IFRS 14 (new) Regulatory Deferral Accounts 1 January 2016IFRS 15 (new) Revenue from Contracts with Customers 1 January 2017IFRIC 21 (new) Accounting for Levies 1 January 2014IAS 19 (amendment) Defined Benefit Plan 1 July 2014IFRS 3 (amendment) Business Combinations 1 July 2014IFRS 13 (amendment) Fair Value Measurement 1 July 2014IAS 16 (amendment) Property, Plant and Equipment 1 July 2014IAS 24 (amendment) Related Party Disclosures 1 July 2014IAS 40 (amendment) Investment Property 1 July 2014IFRS 11 (amendment) Joint Arrangements 1 January 2016IAS 16 and IAS 38 (amendment)

Property, Plant and Equipment and Intangible Assets

1 January 2016

IAS 16 and IAS 41 (amendment)

Property, Plant and Equipment and Agriculture

1 January 2016

IFRS 10 and IAS 28 (amendment)

Sale or Contribution of Assets 1 January 2016

IAS 27 (amendment) Separate Financial Statements 1 January 2016IFRS 5 (amendment) Non-current Assets Held for Sale 1 July 2016IFRS 7 (amendment) Financial Instruments: Disclosure 1 July 2016IAS 19 (amendment) Discount Rate 1 July 2016IAS 34 (amendment) Interim Financial Reporting 1 July 2016

IFRS 9, “Financial Instruments (2009)”, amended and effective 1 January 2018. This IFRS is part of the International Accounting

Standards Board “IASB” project to replace IAS 39. IFRS 9 addresses classification and measurement of financial assets and replaces the multiple classification and measurement models in IAS 39 with a single model that has only two classification categories: amortised cost and fair value.

In addition, the IASB has updated IFRS 9 to include guidance on financial liabilities and derecognition of financial instruments. The accounting and presentation for financial liabilities and for derecognising financial instruments has been relocated from IAS 39, “Financial Instruments: Recognition and Measurement”, without change, except for financial liabilities that are designated at fair value through profit or loss.

Amendments to IFRS 10, “Consolidated Financial Statements” effective 1 January 2014, IFRS 12, “Disclosure of Interests in Other Entities” and IAS 27, “Separate Financial Statements” for investment entities. The amendments mean that many funds and similar entities will be exempt from consolidating most of their subsidiaries. Instead they will measure them at fair value through profit or loss. The amendments give an exception to entities that meet an ‘investment entity’ definition and which display particular characteristics.



A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2013, and have not been applied in preparing these consolidated financial statements. The following, set out below, are expected to have an effect on the consolidated financial statements of the Group (continued);

Changes have also been made in IFRS 12 to introduce disclosures that an investment entity needs to make.

Amendments to IAS 32, “Financial Instruments: Presentation” effective 1 January 2014. The IASB has issued amendments to the application guidance that clarify some of the requirements for offsetting financial assets and financial liabilities on the balance sheet. However, the clarified offsetting requirements for amounts presented in the statement of financial position continue to be different from US GAAP.

Narrow-scope amendments to IAS36, “Impairment of Assets” effective 1 January 2014 - These amendments address the disclosure of information about the recoverable amount of impaired assets if that amount is based on fair value less cost of disposal.

Amendment to IAS 39, “Financial Instruments: Recognition and Measurement”. The IASB has amended IAS 39 to provide relief from discontinuing hedge accounting when novation of a hedging instrument to a Central Counter Party (“CCP”) meets specified criteria. Similar relief will be included in IFRS 9, “Financial Instruments”.

Amendment to IFRS 2, “Share Based Payments” effective 1 July 2014 - The amendment clarifies the definition of a ‘vesting condition’ and separately defines ‘performance condition’ and ‘service condition’.

Amendment to IFRS 8, “Operating Segments” effective 1 July 2014 - The standard is amended to require disclosure of the judgements made by management in aggregating operating segments. This includes a description of the segments which have been aggregated and the economic indicators which have been assessed in determining that the aggregated segments share similar economic characteristics. The standard is further amended to require a reconciliation of segment assets to the entity’s assets when segment assets are reported.

The IASB has issued IFRS 14, “Regulatory Deferral Accounts” effective 1 January 2016, an interim standard on the accounting for certain balances that arise from rate-regulated activities (“regulatory deferral accounts”). Rate regulation is a framework where the price that an entity charges to its customers for goods and services is subject to oversight and/or approval by an authorised body.

IFRS 15 - “Revenue from Contracts with Customers” - effective 1 January 2017 - Establishes principles for reporting useful information to users of the financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers.

IFRIC 21, “Accounting for Levies” effective 1 January 2014, sets out the accounting for an obligation to pay a levy that is not income tax. The interpretation addresses diversity in practice around when the liability to pay a levy is recognised.

Amendment to IAS19 regarding Defined Benefit Plan effective 1 July 2014 - These narrow scope amendments apply to contributions from employees or third parties to defined benefit plans. The objective of the amendments is to simplify the accounting for contributions that are independent of the number of years of employee service, for example, employee contributions that are calculated according to a fixed percentage of salary.

Amendment to IFRS 3, “Business Combinations” effective 1 July 2014 - The standard clarifies that an obligation to pay contingent consideration which meets the definition of a financial instrument is classified as a financial liability or equity, on the basis of the definitions in IAS 32, “Financial Instruments: Presentation”. It also clarifies that all non-equity contingent consideration is measured at fair value at each reporting date, with changes in value recognised in profit or loss.




Amendment to IFRS 13, “Fair Value” effective 1 July 2014, which amended the basis on conclusions to clarify that it did not intend to remove the ability to measure short term receivables and payables at invoice amounts where the effect of discounting is immaterial.

Amendment to IAS 16, “Property, Plant and Equipment” and IAS 38 “Intangible Assets” effective 1 July 2014, are amended to clarify how the gross carrying amount and the accumulated depreciation are treated where an entity uses the revaluation

model.

Amendment to IAS 24, “Related Party Disclosures” is amended to include, as a related party, an entity that provides key management personnel services to the reporting entity or to the parent of the reporting entity (the “management entity”). Disclosure of the amounts charged to the reporting entity is required.

Amendment to IFRS 3, “Business Combinations” effective 1 July 2014 is amended to clarify that IFRS 3 does not apply to the accounting for the formation of any joint venture under IFRS 11.

Amendment to IFRS 13, “Fair Value Measurement” effective 1 July 2014 is amended to clarify that the portfolio exception in IFRS 13 applies to all contracts (including non-financial contracts) within the scope of IAS 39 or IFRS 9.

Amendment to IAS 40, “Investment Property” effective 1 July 2014 is amended to clarify that IAS 40 and IFRS 3 are not mutually exclusive. IAS 40 assists users to distinguish between investment property and owner-occupied property. Preparers also need to consider the guidance in IFRS 3 to determine whether the acquisition of an investment property is a business combination.

Amendment to IFRS 11, “Joint Arrangements” regarding acquisition of an interest in a joint operation effective 1 January 2016. The amendment provides new guidance on how to account for the acquisition.

Amendment to IAS 16, “Property, Plant and Equipment” and IAS 38, “Intangible Assets” regarding depreciation and amortisation effective 1 January 2016. The amendment clarifies that the use of revenue based method to calculate depreciation of an asset is not appropriate.

Amendment to IAS 16, “Property, Plant and Equipment” and IAS 41, “Agriculture” regarding bearer plants effective 1 January 2016. The amendment changes the reporting for bearer plants such as grape vines, rubber trees and oil palms. Bearer plants should be accounted for in the same way as property, plant and equipment.

Amendments to IFRS 10 and IAS 10 and IAS 28 regarding the sale or contribution of assets between an investor and its associate or joint venture effective 1 January 2016. These amendments address an inconsistency between IFRS10 and IAS 28 in the sale or contribution of assets between an investor and its associate or joint venture.

Amendments to IAS 27 “Separate Financial Statements” regarding the equity method effective 1 January 2016. The amendment allows entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements.




Amendments to IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations” effective 1 July 2016. The amendment clarifies that, when an asset (or disposal group) is reclassified from ‘held for sale’ to ‘held for distribution’, or vice versa, this does not constitute a change to a plan of sale or distribution, and does not have to be accounted for as such. This means that the asset (or disposal group) does not need to be reinstated in the financial statements as if it had never been classified as ‘held for sale’ or ‘held for distribution’ simply because the manner of disposal has changed. The amendment also explains that the guidance on changes in a plan of sale should be applied to an asset (or disposal group) which ceases to be held for distribution but is not reclassified as ‘held for sale’.

IFRS 7, “Financial Instruments: Disclosures” effective 1 July 2016 outlines an amendment to: Servicing contracts – If an entity transfers a financial asset to third party under conditions which allow the transferor to derecognise the asset, IFRS 7 requires disclosure of all types of continuing involvement that the entity might still have in the transferred assets

“IAS 19, “Employee Benefits” – The amendment clarifies that, when determining the discount rate for post-employment benefit” obligations, it is the currency that the liabilities are denominated in that is important, not the country where they arise. The assessment of whether there is a deep market in high-quality corporate bonds is based on corporate bonds in that currency, not corporate bonds in a particular country. Similarly, where there is no deep market in high-quality corporate bonds in that currency, government bonds in the relevant currency should be used. The amendment is retrospective but limited to the beginning of the earliest period presented.

IAS 34, “Interim Financial Statements” effective 1 July 2016, the amendment clarifies that the additional disclosure required by the amendments to IFRS 7, ‘Disclosure – Offsetting financial assets and financial liabilities’ is not specifically required for all interim periods unless required by IAS 34. This amendment is retrospective.

The Group is considering the implications of these new standards, amendments and interpretations, their impact on the Group and the timing of their adoption.

The following new standards, amendments and interpretations have been issued and are effective, but are not relevant to the Group:

Content


IAS 19 (amendment) Employee Benefits 1 January 2013

IFRS 1 (amendment) Government Loans 1 January 2013

IFRIC 20 (new) Stripping Costs in the Production Phase of a Surface Mine 1 January 2013

IAS 19 (amendment) “Employee Benefits” This amendment eliminates the corridor approach and calculates finance costs on a net funding basis.

IFRS 1 (amendment) ‘First Time Adoption’, on Government Loans. This amendment addresses how a first-time adopter would account for a government loan with a below-market rate of interest when transitioning to IFRS.



The following new standards, amendments and interpretations have been issued and are effective, but are not relevant to the Group (continued):

IFRIC 20 (new) “Stripping Costs in the Production Phase of a Surface Mine”. This interpretation sets out the accounting for overburden waste removal (stripping) costs in the production phase of a surface mine.

Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group 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 over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

The Group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree 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. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets.

Acquisition-related costs are expensed as incurred.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognised in profit or loss.

Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with IAS 39, “Financial Instruments: Recognition and Measurement” either in profit or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity.

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 identifiable net assets acquired is recorded as goodwill. If the total of consideration transferred, non-controlling interest recognised and previously held interest measured 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 statement of comprehensive income.

Inter-company transactions, balances, and unrealised gains or losses on transactions between group companies are eliminated.

When necessary, amounts reported by subsidiaries have been adjusted to conform with the Group’s accounting policies.

All subsidiaries in the Group are 100% owned, have 30 September year ends and are consolidated in the presented financial statements.

In the Company’s separate financial statements, investments in subsidiaries are accounted for at cost less accumulated allowance for impairment.



Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.

When the Group ceases to have control, any retained interest in the entity is re-measured to its fair value at the date when

control is lost, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding

of between 20% and 50% of the voting rights. If the holding is less than 20%, the Group will be presumed not to have significant influence unless such influence can be clearly demonstrated. The existence of significant influence by the Group is usually evidenced in one or more of the following ways:

-representation on the board of directors or equivalent governing body of the investee; -participation in the policy-making process; -material transactions between the investor and the investee; -interchange of managerial personnel; and -provision of essential technical information.

Investments in associates are accounted for by the equity method of accounting and are initially recognised at cost and the carrying amount is increased or decreased to recognise the investor’s share of profit or loss of the investee and movements in

other reserves after the date of acquisition. The Group’s investment in associates includes goodwill identified on acquisition.

When the investment, or portion of an investment, meets the criteria to be classified as held for sale, the portion so classified is accounted for in accordance with IFRS 5, “Non-Current Assets Held for Sale and Discontinued Operations”. Any remaining portion is accounted for using the equity method until the time of disposal, at which time the retained investment is accounted under IAS 39, “Financial Instruments: Recognition and Measurement”, unless the retained interest continues to be an associate.

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.

The Group’s share of post-acquisition profit or loss is recognised in the statement of comprehensive income and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.

The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to ‘share of profit / (loss) of an associate’ in the statement of comprehensive income.

Profits and losses resulting from upstream and downstream transactions between the Group and its associate are recognised in the Group’s financial statements only to the extent of unrelated investor’s interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred.



Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group.

Dilution gains and losses arising in investments in associates are recognised in the statement of comprehensive income.

As at 30 September 2013, the Group had one associate (Dawn Properties Limited) which was classified to non-current assets held for sale during the financial year ended 30 September 2014. Details of the investment in the associate are in notes 11 and 12.

The Group has retrospectively applied IFRS 11, “Joint Arrangements” for the first time to all joint arrangements as at 1 October

2013. Under IFRS 11, “Joint Arrangements”, investments in joint arrangements are classified as either joint operations or joint ventures depending on the contractual rights and obligations of each investor. The Group has assessed the nature of its joint arrangements and determined West African Sun Hotels Limited to be a joint venture and The Victoria Falls Hotel to be a joint operation. Joint operations are proportionally consolidated. Joint ventures are accounted for using the equity method.

Under the equity method of accounting, interests in joint ventures are initially recognised at cost and adjusted thereafter to recognise the Group’s share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group’s share of losses in a joint venture equals or exceeds its interests in the joint ventures (which includes any long-term interests that, in substance, form part of the Group’s net investment in the joint ventures), the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the joint ventures.

Unrealised gains on transactions between the Group and its joint ventures are eliminated to the extent of the Group’s interest in the joint ventures. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of the joint ventures have been changed where necessary to ensure consistency with the policies adopted by the Group.

The effects of the change in accounting policies on the financial position, comprehensive income and the cash flows of the Group are shown in note 6.

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision- maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the

operating segments, has been identified as the “executive committee” which is made up of all executive directors that make strategic decisions.

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary

economic environment in which the entity operates (“the functional currency”). The financial statements are presented in the United States of America dollar (“US$”), which is the Company’s and the Group’s functional and presentation currency.

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of

the transactions or valuation where items are re-measured. Foreign exchange gains or losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive income.



Foreign exchange gains or losses that relate to borrowings and cash and cash equivalents are presented in the statement of comprehensive income within ‘finance income or cost’. All other foreign exchange gains or losses are presented in the statement of comprehensive income within ‘administration expenses’. Translation differences related to changes in amortised cost are recognised in profit or loss, and other changes in carrying amount are recognised in other comprehensive income.

Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets, such as equities classified as available for sale are included in other comprehensive income.

The results and financial position of all the Group entities that have a functional currency different from the presentation

currency (none of which has the currency of a hyper-inflationary economy) are translated into the presentation currency as follows:

(i) assets and liabilities for each statement of financial position presented are translated at the closing exchange rate at the date of that statement of financial position.

(ii) income and expenses for each statement of comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

(iii) all resulting exchange differences are recognised in other comprehensive income.

On consolidation, exchange differences arising from the translation of the net investment in foreign operations, and of borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders’ equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are recognised in the statement of comprehensive income as part of the gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing exchange rate. Exchange differences arising are recognised in other comprehensive income.

Property and equipment are stated at fair value based on periodic valuations by the independent external valuers, less subsequent accumulated depreciation and impairment losses. Valuations are performed with sufficient regularity to ensure that the fair value of a revalued asset does not differ materially from its carrying amount.

Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is restated to the revalued amount of the asset. Increases in the carrying amount arising on revaluation of property and equipment are credited to a revaluation reserve through the statement of comprehensive income. Decreases that offset previous increases of the same asset are charged against other reserves in equity through other comprehensive income; all other decreases are charged to the statement of comprehensive income. The revaluation surplus included in equity in respect of an item of property and equipment is transferred directly to retained earnings when the asset is derecognised.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the statement of comprehensive income during the financial period in which they are incurred.

Land is not depreciated.



Depreciation is calculated on a straight line basis in order to allocate cost or revalued amounts to the residual values over their

estimated useful lives as listed below: Leasehold properties 8-25 years Freehold properties 50 years Equipment 6-15 years Motor vehicles 5 years Service stocks / hotel operating equipment 7 years

Capital work in progress comprise items of equipment not yet commissioned and is not depreciated. When the equipment is commissioned, it is transferred to the relevant categories and depreciation commences.

The useful lives and residual values of assets are reviewed and adjusted if appropriate at each reporting date. Where the residual value of an asset increases to an amount equal to or greater than the asset’s carrying amount, depreciation will cease to be charged on the asset until its residual value subsequently decreases to an amount below its carrying amount.

Assets are assessed for potential impairment when there is objective evidence of impairment. If circumstances exist which suggest that there may be impairment, a more detailed exercise is carried out which compares the carrying values of the assets to recoverable value based on either realisable value (fair value less costs associated with disposal) or value-in-use. Value-in-use is determined using discounted cash flows budgeted for each cash-generating unit. Detailed budgets for the ensuing five years are used and, where necessary, these are extrapolated for future years taking into account known structure changes. The discount rate used is the internally computed weighted average cost of capital (“WACC”) which is currently at 13.5% (2013: 13.5%). Impairment losses are recognised as an expense in the statement of comprehensive income and the carrying value of the asset and its annual depreciation are adjusted accordingly (refer note 2.7).

In the event that, in a subsequent period, an asset that has been subject to an impairment loss is considered no longer to be impaired, the value is restored and the gain is recognised in the statement of comprehensive income. The restoration is limited to the value which would have been recorded had the impairment adjustment not taken place.

Profit or losses arising on the disposal of property and equipment are determined by comparing proceeds with the carrying amount. These are included in the statement of comprehensive income within other income or other expenses.

The Group capitalises borrowing costs directly attributable to the construction of new projects or re-development of existing hotels as part of the cost of that asset, where construction of new projects or re-development (refurbishment) of existing hotels takes a substantial period of between 6 and 12 months to complete.

The Group engages in agricultural activity through management of biological assets for sale as agricultural produce.

Timber plantations are measured at their fair value less estimated point-of-sale costs. The fair value of timber plantations is

determined by a professional valuer based on fair values for the stages of forest development.

Assets that have an indefinite useful life, for example goodwill, 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 asset’s carrying amount 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”). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.



Non-current assets (or disposal groups) are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is considered highly probable. They are stated at the lower of the carrying amount and fair value less costs to sell.

The Group classifies its financial assets in the following categories: loans and receivables, available-for-sale and at fair value through profit or loss. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

Loans and receivables are non-derivative financial assets with fixed or determinable payment terms that are not quoted in active

markets. They are included in current assets, except for maturities greater than twelve months after the end of the reporting period. These are classified as non-current assets. The Group’s loans and receivables comprise “trade and other receivables” and “cash and cash equivalents” in the statement of financial position.

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any other

categories. They are included in non-current assets unless management intends to dispose of the investment within twelve months of the end of the reporting period. Gains or losses arising in the fair value of the “available-for-sale financial assets” are recognised in the statement of comprehensive income within the period in which they arise.

Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Derivatives are also categorised as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if expected to be settled within 12 months, otherwise they are classified as non-current.

Regular purchases and sales of financial assets are recognised on the trade-date – the date on which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets are subsequently carried at fair value. Loans and receivables are carried at amortised cost using the effective interest method.

The fair values of quoted investments are based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the Group establishes fair value using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, and option pricing

models, making maximum use of market inputs and relying as little as possible on entity-specific inputs.

Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously.

The Group 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. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a “loss event”) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or a group of financial assets that can be reliably estimated.



Evidence of impairment may include indications that the debtor or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation, and where observable data indicates that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

For loans and receivables category, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the statement of comprehensive income.

If a loan or held-to-maturity investment has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. As a practical expedient, the Group may measure impairment on the basis of an instrument’s fair value using an observable market price.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in the statement of comprehensive income.

The Group 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 also evidence that the assets are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit and loss is removed from equity and recognised in the statement of comprehensive income. Impairment losses recognised in the statement of comprehensive income on equity instruments are not reversed through the statement of comprehensive income. If in a subsequent period, the fair value of a debt instrument classified as available-for-sale increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in the statement of comprehensive income, the impairment loss is reversed through the statement of comprehensive income.

Inventories, which consist of foodstuffs, beverages, shop merchandise and consumable stores are stated at the lower of cost and net realisable value. Cost is determined on weighted average cost method. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs necessary to make the sale.

Trade receivables are amounts due from customers for food, beverages, shop merchandise and rooms sold in the ordinary course of business. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets, if not they are presented as non-current assets. Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method, less allowance for impairment.

An allowance for impairment of trade receivables is established where there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The amount of the allowance is the difference between the carrying amount and the present value of future cash flows, discounted at the effective interest rate. The amount of the allowance is recognised in the statement of comprehensive income.

In the consolidated statement of cash flows, cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. In the statement of financial position, bank overdrafts are shown within borrowings in current liabilities.



Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of income tax from the proceeds.

Where any Group company purchases the Company’s equity share capital (“treasury shares”), the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders until the shares are cancelled or reissued. Where such shares are subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects is included in equity attributable to the Company’s equity holders.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of busines from suppliers. Trade payables are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.

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

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the statement of comprehensive income over the period of the borrowings using the effective interest method.

Fees paid on establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs to the extent that there is no evidence that it is probable that some or all of the facility will be drawn down. The fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.

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 reporting date.

General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets,

which are assets that necessarily take a substantial period of time to get ready for their intended use, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use.

The qualifying assets are leasehold improvements. Hotel refurbishment generally takes a period of 24 months to complete, while a new hotel takes between 9 and 12 months to complete the furnishing with the required items of furniture and fittings for the rooms to be ready for use.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

The income tax expense for the period comprises current and deferred income tax. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case the tax is also recognised in other comprehensive income or directly in equity, respectively.



The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the reporting date in the countries where the Company, its subsidiaries, associates and joint arragements operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes liabilities where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is recognised using the liability method on temporary differences arising between the tax bases of assets and liabilities, and their carrying amounts in the financial statements. However, deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the statement of financial position date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except for deferred income tax liability where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current income tax assets against current income tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Restructuring provisions comprise lease termination penalties and employee termination payments. Provisions are not recognised for future operating losses.

Where there is a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense.

The Group has a defined contribution plan. A defined contribution plan is a pension plan under which the Group pays fixed

contributions into a separate entity. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current period and prior periods.

The Group pays contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligations once the contributions have been paid. The contributions are recognised as an employee benefit expense when they are due. Pre-paid contributions are recognised as an asset to the extent that a cash refund or reduction in the future payments is available.



Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or whenever

an employee accepts voluntary redundancy in exchange for these benefits. The Group recognises termination benefits when it is demonstrably committed to a termination when the entity has a detailed formal plan to terminate the employment of current employees without possibility of withdrawal. In the case of an offer made to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer. Benefits falling due more than 12 months after the end of the reporting period are discounted to their present value.

The Group recognises a liability and an expense for bonuses based on a formula that takes into consideration key performance

indicators measured on a quarterly basis. The Group recognises a provision where it is contractually obliged or where there is a past practice that has created a constructive obligation.

The Group operates an equity-settled, share-based compensation plan, under which the entity receives services from employees

as consideration for equity instruments (“options”) of the Group. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted:

- including any market performance conditions (for example, an entity’s share price); - excluding the impact of any service and non-market performance vesting conditions (for example, profitability, sales growth

targets and remaining an employee of the entity over a specified time period); and - including the impact of any non-vesting conditions (for example, the requirement for employees to save).

Non-market performance and service conditions are included in assumptions about the number of options that are expected to vest. The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied.

In addition, in some circumstances employees may provide services in advance of the grant date and therefore the grant date fair value is estimated for the purposes of recognising the expense during the period between service commencement period and grant date.

At the end of each reporting period, the Group revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in the statement of comprehensive income, with a corresponding adjustment to equity.

When the options are exercised, the Company issues new shares. The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium.

2 Revenue is measured at the fair value of the consideration received or receivable for the sale of goods and services in the

ordinary course of the Group’s activities. Revenue is shown net of value-added tax, rebates and discounts.

The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and when specific criteria have been met for each of the Group’s activities as described below:

Revenue from sale of goods is primarily derived from the sale of room nights, sale of food and beverages and sale of shop

merchandise. Revenue is recognised when room nights, food, beverages and shop merchandise are sold.



2

Net gaming win comprises the net table and slot machine win derived by casino operations from gambling patrons. In terms

of IFRS, betting transactions concluded under gaming operations meet the definition of derivatives and therefore income from gaming operations represents the net position arising from financial instruments. The net gaming win is measured as the net cash received from betting transactions from casino operations. Due to the short-term nature of the Group’s casino operations, all income is recognised in profit or loss immediately, at fair value.

The extended reservations system involves the sale of timeshare weeks owned by the Group and management fees earned

from running the administration for the timeshare associations. Revenue is accounted when timeshare weeks are sold and management fees are earned.

Interest income on loans and receivables is recognised using the effective interest rate method. When a loan and receivable is

impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans and receivables are recognised using the original effective interest rate.

Interest income on bank deposits is recognised when it is due and payable to the Group.

Cost of sales includes purchase price of goods and other costs incurred in bringing the inventories to the location and condition

ready for use or sale. The costs include costs of purchasing, storing, transport to the extent it relates to bringing the inventories to the location and condition ready for use or sale.

Salaries and wages of employees directly related with the sale of room nights, food, beverages and other items of merchandise are included in cost of sales.

Dividend income is recognised when the right to receive payment is established.

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating

leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the statement of comprehensive income on a straight-line basis over the period of the lease. Leases of property and equipment where the Group has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s commencement at the lower of the fair value of the leased property and the present value of the minimum 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 cost is charged to the statement of comprehensive income over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Items of property and equipment acquired under finance leases are depreciated over the shorter of the useful life of the asset and the lease term.

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 by the Company’s directors.



3 FINANCIAL RISK MANAGEMENT

The Group’s activities expose it to a variety of financial risks; market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance.

Risk management is carried out by the Group Finance Department (“Group Finance”) under policies approved by the Board of Directors. Group Finance identifies, evaluates and manages financial risks in close co-operation with the Group’s operating units. The Board provides principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.

The Group operates regionally and is exposed to foreign exchange risk arising from various currency exposures, primarily with

respect to the Ghanian Cedi and the South African Rand. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.

Management has set up a policy that allows Group Finance to manage the Group’s foreign exchange risk against the various functional currencies. To manage the Group’s foreign exchange risk arising from future commercial transactions and recognised assets and liabilities, Group Finance may use forward contracts and the asset and liability matching methods, where applicable. Foreign exchange risk arises when future commercial transactions or recognised assets or liabilities are denominated in a currency that is not the entity’s functional currency.

The table below summarises the Group’s exposure to foreign exchange risk as at 30 September 2014. Included in the table are the Group’s assets and liabilities at carrying amounts categorised by currency.

COMPANY GROUP

US$ US$ US$ US$

AssetsSouth African Rand 16 333 20 033 2 024 263 1 391 453 Botswana Pula - - 120 168 120 631 Australian Dollar - - 1 080 9 317 Euro - - 58 849 36 667 Ghanian Cedi - - 2 693 436 3 516 480

16 333

LiabilitiesSouth African Rand - - 1 366 811 1 286 593 Botswana Pula 243 058 243 058 Ghanian Cedi - - 392 138 17 035

- -

16 333

The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group’s foreign operations is managed separately as it is deemed to impact the Group, with the introduction of Ghana. Group Finance monitors the movements in the relevant currencies of investment against the reporting currency.



As at 30 September 2014, if the United States of America dollar weakened / strengthened by 10% against all the other currencies

with all other variables held constant, post tax profit / (loss) for the year would have been US$289 579 (2013: US$352 786) higher / lower, mainly as a result of foreign exchange gains / losses on translation of South African Rand and Ghanian Cedi denominated cash and bank balances, trade receivables, trade payables and borrowings.

The table below summarises the changes in assets and liabilities denominated in the South African Rand and Ghanian Cedi

arising from a 10% appreciation of the United States of America dollar:

COMPANY GROUP

US$ US$ US$ US$

AssetsSouth African Rand 14 700 18 030 1 821 836 1 252 308 Ghanian Cedi' - - 2 424 092 3 164 832

LiabilitiesSouth African Rand - - 1 230 130 1 157 934 Ghanian Cedi' - - 352 924 15 332

- -

There were no hedges in place as at 30 September 2014 (2013: US$nil).

The Group is exposed to equity price risk because of the investment held by the Group and classified on the consolidated

statement of financial position as a non current asset held for sale. The Group is not exposed to commodity price risk.

The table below summarises the impact of increases or decreases of the Zimbabwe Stock Exchange (“ZSE”) on the Group’s post-tax profit for the year. The analysis is based on the assumption that the equity index has increased or decreased by 25% with all other variables held constant and the Group’s equity instruments moved according to the historical correlation with the index.

COMPANY GROUP Impact of 25% equity index: US$ US$ US$ US$

Equity accounted investments

The Group’s interest rate risk arises from long-term and short-term borrowings. Borrowings issued at variable rates expose

the Group to cash flow interest rate risk. Borrowings issued at fixed rates expose the Group to fair value interest rate risk.

The Group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration refinancing, renewal of existing positions and alternative financing. Based on these scenarios, the Group calculates the impact on profit or loss of a defined interest rate shift. For each simulation, the same interest rate shift is used for all currencies. The scenarios are run for all interest-bearing positions.

Based on the simulations performed, the impact on post tax loss and equity of a 1% shift in interest rates, with all other variables held constant would be a maximum increase / (decrease) of US$174 168 (2010: US$223 210). The simulations are done quarterly

given the nature of the current loan facilities to verify that the maximum loss potential is within the limit set by management.



Currently, the Group does not undertake any hedging of its short-term loans due to the nature and terms of the loan facilities.

On long-term loans, the Group assesses risks and considers hedging where necessary. As at 30 September 2014, there were no hedges in place (2013: US$nil).

For corporate customers, Group Finance assesses the credit quality of the customers taking into account their financial

position, past experience and other factors in the market. Individual limits are set based on internal and external information. The utilisation of credit limits is regularly monitored by Group Finance. As at 30 September 2014, customers with balances of US$485 017 exceeded their credit limits (2013: US$496 094).

Counterparty risk is further managed by constant engagement of credit customers to determine the current position and recoverability. All credit granted is subject to terms and conditions, where, upon breach by the customers, the Group takes legal action where amounts are material and recovery is possible. As at 30 September 2014,customers with balances of US$198 528 were handed over to debt collectors (2013: US$130 000). Receivables handed over for legal action are generally written off as uncollectible and are reversed when recovered.

There is no risk associated with receivables from related parties and staff.

In the view of management, the credit quality of unimpaired trade receivables is considered sound. Management does not expect any losses from non-performance by these counter parties.

The Group ‘s maximum exposure to credit risk by class of financial asset is as follows:

COMPANY GROUP

US$ US$ US$ US$

Trade and other receivables (excludingpre-payments) 2 336 697 1 598 957 6 860 942 8 403 639 Cash and cash equivalents (excluding bankoverdrafts) 161 186 989 319 2 734 576 4 229 079

The fair value of cash and cash equivalents as at 30 September 2014 approximates the carrying amount. Trade and other receivables excluding pre-payments are shown after specific allowance for impairment.

The credit quality of trade receivables can be assessed by reference to historical information about counterparty default rates.

Trade receivables from counterparties without external rating are shown below:

COMPANY GROUP

US$ US$ US$ US$

Group 1 - - 3 031 862 3 292 727 Group 2 - - 1 299 370 1 398 400

- - 4 331 232

Group 1-Existing customers with no defaults in the past Group 2-Existing customers with some defaults in the past.



The above receivables are shown after specific allowance for impairment on certain customers.

There is no concentrations of credit risk with respect to cash and cash equivalents as the Group holds cash accounts with high quality financial institutions with sound financial and capital cover. The financial institutions holding the cash and cash

equivalents of the Group have the following external credit ratings:

COMPANY GROUP

US$ US$ US$ US$

AA- 161 186 564 529 1 140 750 725 040 A+ - 271 315 304 439 370 018 A- - - 494 371 399 513 BBB+ - 816 2 217 20 516 BBB - 81 302 642 613 1 662 072 BB+ - 51 586 70 877 602 307 BB - - - 449 613 B+ - 19 771 79 309 -

The ratings have been obtained from the latest available ratings on the financial institutions. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group Finance. Group Finance

monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans, covenant compliance, compliance with internal financial position ratio targets and, if applicable external regulatory or legal requirements, for example, currency restrictions.

Surplus cash held by the operating entities in excess of the balance required for working capital management is transferred to Group Finance. Group Finance invests surplus cash in interest bearing current accounts, time deposits and money markets deposits, choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient head-room as determined by the above-mentioned forecasts.



The table below analyses the Group’s liquidity gap in to relevant maturity groupings based on the remaining period at the

reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

GROUPLess than 1

monthUS$

Between 2 and3 months

US$


US$

Between 2 and5 years

US$TotalUS$

LiabilitiesBorrowings 481 970 2 294 106 7 829 872 6 742 795 Trade and other payables 3 202 965 1 735 428 7 591 695 2 203 358

Total liabilities

Assets held for managing liquidity riskTrade and other receivables (excluding pre-payments) 4 331 232 653 918 1 549 127 612 046 Cash and cash equivalents (excluding bank overdrafts) 2 734 576 - - - Non-current assets held for sale - - 7 347 178 -

Total assets held for managing liquidity risk

-

COMPANY

LiabilitiesBorrowings 336 259 1 023 082 2 603 869 35 141 Trade and other payables 465 809 265 026 2 462 978 2 203 358

Total liabilities

Assets held for managing liquidity riskTrade and other receivables (excluding pre-payments) 226 853 343 800 1 171 998 612 046 Cash and cash equivalents (excluding bank overdrafts) 161 283 - - - Non-current assets held for sale - - 3 171 087 -


-



GROUP

Less than 1month

US$


US$


US$

Between 2 and5 years

US$TotalUS$

LiabilitiesBorrowings 3 290 681 2 659 105 8 278 120 8 093 067 Trade and other payables 3 330 693 4 436 827 6 016 636 1 758 132

Total liabilities

Assets held for managing liquidity riskTrade and other receivables (excluding pre-payments) 4 691 127 921 164 2 264 975 526 374Non-current assets held for sale 4 354 381 - - -Cash and cash equivalents (excluding bank overdrafts) 4 229 079 - - -


6 653 213

6 653 213 -

COMPANY

LiabilitiesBorrowings 3 290 681 531 988 4 245 619 - Trade and other payables 3 896 824 221 848 1 360 689 1 758 132

Total liabilities

Assets held for managing liquidity riskTrade and other receivables (excluding pre-payments) 1 724 651 - 18 000 612 046 Non-current assets held for sale 989 319 - - -Cash and cash equivalents (excluding bank overdrafts) 4 224 720 - - -

Total assets held for managing liquidity risk -

-

Below is an explanation of how the Group’s liquidity gap will be managed: -the Group will be disposing its fixed property in the form of staff houses. The disposal is expected to raise US$4.2 million and the proceeds will be used to repay short-term borrowings; -the Group will be disposing its 16.54% investment in Dawn Properties Limited. The disposal is expected to raise US$5.8 million

and to be completed by 30 September 2015;



-the Group will be seeking a US$6 million rights offer approval from the shareholders at a date to be advised, following approval by the directors; -the Group will be selling new time share contracts for 25 years, and this is expected to raise at least US$2.9 million and

proceeds will be used to repay short-term borrowings; and -utilisation of US$3 million of undrawn facilities available to the Group.

The capital of the Group consists of debt (borrowings as detailed in note 22) and equity which comprises issued ordinary share

capital, accumulated losses and other reserves as detailed in note 17, 18 and 19. There were no changes in the components of debt and equity from last year.

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.

The decrease in debt from last year resulted from repayment towards long-term borrowings and repayment of short-term borrowings from the proceeds of disposal of shares in Dawn Properties Limited. Decrease in equity resulted from current year losses from Ghana and foreign currency translation losses on consolidation of foreign subsidiaries.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including current and non-current borrowings as shown in the statement of financial position) less cash and cash equivalents. Total capital is calculated as “equity” as shown in the statement of financial position plus net debt.

During the financial year ended 30 September 2014, the Group’s strategy was to maintain gearing ratio within 40% to 45%.

The gearing ratios at 30 September 2014 and 2013 were as follows:

COMPANY GROUP

US$ US$ US$ US$

Total borrowings (note 22) 3 998 351 8 068 288 17 348 745 22 320 973 Less cash and cash equivalents (note16) (161 186) ( 989 319) (2 734 576) (4 229 079)

Net debt 3 837 165 7 078 969 14 614 169 18 091 894 Total equity 21 712 251 24 325 754 10 563 467 14 252 813

Gearing ratio

The target gearing of 40%-45% was not achieved due to a delay in repayment of short-term borrowings and loss for the year which reduced the Group’s equity. The loss position of the Group was worsened by the impairment charge relating to the 16.54% investment in Dawn Properties Limited which was marked to market following classification to non-current assets held for sale. However, the initiatives to reduce borrowings, and consequently the gearing during the 2015 financial year are discussed under going concern, note 2.1.2.



4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS Estimates and judgments are continually evaluated and are based on historical experience and other factors, including

expectations of future events that are believed to be reasonable under the circumstances.

The Group makes 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 addressed below:

The Group is subject to income taxes in numerous jurisdictions, Zimbabwe, South Africa, Ghana, Nigeria and Mauritius.

Significant judgment is required in determining the liability for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain. The Group recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred income tax assets and liabilities in the period in which such determination is made.

Were the actual final outcome to differ by 10% from management’s estimates, the Group would need to: - increase the deferred tax liability by US$81 888, if unfavourable, or - decrease the deferred tax liability by US$81 888, if favourable.

Property and equipment is presented at revalued amounts less accumulated depreciation and impairment allowance. A professional valuation is performed periodically to determine the market values, remaining useful lives and residual values of property and equipment. These measurements require the use of critical judgment. Property and equipment was last valued on 31 August 2011.

Revaluations are done making reference to recent market transactions on an arms length basis.

The Directors assess the ability of the Group to continue operating as a going concern at the end of each financial year. As at 30 September 2014, the Directors have assessed the ability of the Group to continue operating as a going concern and believe that the preparation of these financial statements on a going concern basis is still appropriate. Some of the initiatives implemented to ensure the Group returns to profitability and continues as a going concern are discussed under note 2.1.2.

The Group applied the equity accounting method for the investment in Dawn Properties Limited until 30 September 2014 when it

was classified as non-current assets held for sale. Impairment on investment in Dawn Properties Limited is tested by comparing the carrying amount to the recoverable amount. Recoverable amount is the higher of value in use and fair value less cost to sale.

Below are the key assumptions in the calculation on value-in-use at 30 September 2013; -Period of planning: 5 years;

-Discount rate: 13.5%; -Growth rate: 10% in the first two years, 7.5% in the next 2 years, and 3.6% there after; -Inflation: 2.8%; and

-Effective tax rate: 12.5%.

Based on the above, the value-in-use was US$6 066 623.

If the growth rate was limited to 7.5%, in the first 4 years, holding all the other variables constant, the value-in-use would have declined by US$199 261.



The Group owns biological assets in the form of a timber plantation. The fair value of the plantation is determined by an expert

through obtaining the stumpage value of the trees, using the Faustmann model. Variables are input into the formula (including international rates) to derive the fair value. The following variables were used for the valuation as at 30 September 2014; -estimated area of plantation: 567 hectares (2013: 567 hectares) -age of trees 2-24 years (2013: 4-23 years) -valuation based on trees only 8 years and older (2013: 7 years and older) -risk / discount: 15% (2013: 15%)

The upper age limit of the trees moved to 24 years in 2014 from 23 years in 2013 as the oldest trees in the plantation matured by a year older. The lower age limit was reassessed to 2 years in 2014 from 4 years in 2013 as a result of regenerations in the plantation. As at 30 September 2013, the regenerations had not yet matured to the level of being valued.

The Group operates an equity-settled, share-based compensation plan, under which the entity receives services from employees

as consideration for equity instruments (options) of the Company. The fair value of the employee services received is calculated making certain assumptions which require critical judgment. For the year ended 30 September 2014, the amount charged to the statement of comprehensive income as employee cost was based on the valuation performed by an expert using the following agreed assumptions with management;

-volatility of the African Sun Limited shares: 70.23% (2013: 70.23); -risk free rate: 2.13% (2013: 2.13%), based on the Federal Reserve Bank of United States of America 10 year treasury bills. The

basis is supported by the fact that Zimbabwe is a United States of America dollar based economy; -vesting period: 3 years (2013: 3 years); and -all eligible executives will be in service for the 3 year period.

Interest cover times This is the ratio of income before tax and interest to interest expensed.

Net assets These are equivalent to shareholders’ equity.

This a measure used to assess the rate at which a hotel generates revenue compared to its market. It is calculated by dividing

the hotel’s RevPAR by the total market RevPAR.

This is calculated by dividing the total rooms revenue by the outstanding rooms for the year.

This is the profit before financing costs or income and income tax.

This is the profit before financing costs or income, income tax, depreciation and amortisation.



Pre-tax return on equity This is calculated by dividing operating income plus dividend income and equity accounted earnings by closing total shareholders’

equity. Pre-tax return on total assets This is calculated by dividing operating income plus dividend income and equity accounted earnings by closing total assets.

This is calculated by dividing income after taxation plus taxed interest payable by closing total capital employed.

The calculations are based on the headline earnings attributable to ordinary shareholders. Account is taken of the number of

shares in issue for the period during which they have participated in the income of the Group.

Diluted headline earnings per share are calculated by dividing the headline earnings / (loss) by the adjusted weighted average

number of ordinary shares, assuming conversion of all dilutive potential ordinary shares.

Financial gearing ratio This represents the ratio of interest bearing debt, less cash to total shareholders’ equity.

5 SEGMENT INFORMATION Management has determined the operating segments based on the reports reviewed by the executive committee (executive

management team), that makes strategic decisions for the purposes of allocating resources and assessing performance.

The committee considers the business from a geographical perspective. Geographically, management considers the performance of leased hotel properties in Southern Africa and properties under management in West Africa. The Southern Africa segment is further split into Botswana, Mauritius, South Africa and Zimbabwe. West Africa segment now relates to Ghana only, following the change in accounting for West African Sun Hotels Limited (“WASHL”) to an associate.

The West Africa segment will have an increased asset base and revenue, with the opening of the Group’s first leased hotel in Accra, Ghana. The hotel is operating under the name Amber Accra Hotel, and was opened on 10 December 2013.

The executive committee assesses the performance of the operating segments based on: - hotel occupancies; - hotel revenue per available room (“RevPAR”);

- hotel average daily rate (“ADR”); and - profitability.

The Group does not rely on any one specific customer as none of its customers contributes more than 10% of its revenue.

All interest bearing liabilities have been allocated to segments as they relate to specific bank loans obtained by the segments.

EBITDA has been calculated excluding exceptional charges relating to fair value adjustments and impairments for 2014 and the comparatives.

The Group changed its accounting policy relating to accounting for its investment in WASHL following the adoption of IFRS 11

“Joint Arrangements” as discussed in note 6. The change has resulted in WASHL being accounted for using the equity method, and not consolidated proportionately as was previously done. The Group has since restated the prior year financial information relating to WASHL.



Revenue Sales between segments are eliminated on consolidation. The revenue from external parties reported to the executive committee

is measured in a manner consistent with that in the statement of comprehensive income.

The segment information provided to the executive committee for the reportable segments is as follows:

Southern Africa West Africa

ZimbabweUS$

South Africaand

MauritusUS$

BotswanaUS$

GhanaUS$

Intersegmenttransactions

US$Consolidated

US$

Discontinued

US$

Continuing

US$

Sale of rooms 28 601 439 - - 1 531 857 - 30 133 296 - 30 133 296 Sale of food and beverages 22 552 904 - - 584 782 - 23 137 686 - 23 137 686 Management fees and commissions - 1 533 551 - - ( 1 533 551) - - - Gaming 732 336 - - - - 732 336 - 732 336 Conferencing 978 466 - - - - 978 466 - 978 466 Rent and other income 1 698 212 - - 36 149 - 1 734 361 - 1 734 361

Total revenue 1 533 551 - -

Cost of sales 15 403 075 - - 496 719 - 15 899 794 - 15 899 794 Employee benefit expenses 9 931 995 265 003 - 390 930 - 10 587 928 - 10 587 928 Operating lease costs 6 635 298 97 975 - 2 069 975 - 8 803 248 - 8 803 248

31 970 368 362 978 - 2 957 624 - 35 290 970 - 35 290 970

Other information

EBITDA - Depreciation ( 2 958 479) ( 2 953) - ( 116 662) - ( 3 078 094) - ( 3 078 094)Impairment charge ( 3 467 721) ( 157 026) - ( 103 287) - ( 3 728 034) - ( 3 728 034)Finance income - 3 952 - - - 3 952 - 3 952 Recycled from other comprehensive income 249 706 - - - - 249 706 - 249 706 Finance costs ( 3 090 412) - - ( 447 720) - ( 3 538 132) - ( 3 538 132)Other income 111 526 - - - - 111 526 - 111 526 Other expenses ( 348 017) - - - - ( 348 017) - ( 348 017)Share of income from equity accounted investments 274 315 - - - - 274 315 - 274 315

income tax 312 463 -

Total assets -

Total assets include:Additions to non-currentassets (other thanfinancial instruments and deferred income tax assets):-Property and equipment 3 010 965 - - 1 094 779 - 4 105 744 - 4 105 744 -Other non-current receivables 189 849 - - - - 189 849 - 189 849

- - - -

Total liabilities - -

Occupancy (%) 49 - - 26 - 48 - 48ADR (US$) 97 - - 136 - 98 - 98RevPAR (US$) 48 - - 36 - 47 - 47



Southern Africa West Africa

ZimbabweUS$

South Africaand

MaurutusUS$

BotswanaUS$

GhanaUS$

Intersegmenttransactions

US$Consolidated

US$

Discontinued

US$

Continuing

US$

Revenue: Sale of rooms 28 884 143 - - - - 28 884 143 - 28 884 143 Sale of food and beverages 22 667 732 - - - - 22 667 732 - 22 667 732 Management fees and commissions - 1 149 579 - - ( 1 149 549) - - - Gaming 1 522 041 - - - - 1 522 041 - 1 522 041 Conferencing 1 036 239 - - - - 1 036 239 - 1 036 239 Other 1 857 488 - - - - 1 857 488 - 1 857 488

Total revenue - - -

Cost of sales 15 302 031 - - - - 15 302 031 - 15 302 031 Employee benefit expenses 11 072 145 - - - - 11 072 145 - 11 072 145 Operating lease costs 6 529 657 - - - - 6 529 657 - 6 529 657

- - - - -

Other Information

EBITDA - Depreciation ( 2 207 565) ( 5 855) - - - ( 2 213 420) - ( 2 213 420)Impairment ( 4 417 211) - - - - ( 4 417 211) - ( 4 417 211)Finance income 3 246 2 477 - - - 5 723 - 5 723 Finance costs ( 3 078 510) - - - - ( 3 078 510) - ( 3 078 510)Recycled from OCI 181 165 - - - - 181 165 - 181 165 Other expenses ( 3 710 392) - - - - ( 3 710 392) - ( 3 710 392)Share of income from equity accounted investments 331 034 - - - - 331 034 - 331 034

-

Total assets -

Total assets include:Investment in associate 6 067 253 - - - - 6 067 253 - 6 067 253

Additions to non-current assets other than(financial instruments and deferred tax assets)-Property and equipment 6 906 532 - - 1 095 504 - 8 002 036 - 8 002 036

- - - -

Total liabilities - -

Occupancy (%) 48 - - - - - 48 48ADR (US$) 100 - - - - - 100 100RevPAR (US$) 48 - - - - - 48 48

The amounts provided to the executive committee with respect to total assets are measured in a manner consistent with that of the financial statements. These assets are allocated based on the operations of the segment and the physical location of the asset.

The Group did not record any share of income or losses from its joint venture (“West African Sun Hotels Limited”), as the joint venture was still in a net liabilities position as at 30 September 2014 (2013 US$nil).



6 CHANGE IN ACCOUNTING POLICY African Sun Limited adopted IFRS 11, “Joint Arrangements” on 1 October 2013. IFRS 11, “Joint Arrangements” focuses on

the rights and obligations of the parties to the arrangement rather its legal form. There are two types of joint arrangements: joint operations and joint ventures. Joint operations arise where the investors have rights to the assets and obligations for the liabilities of an arrangement. A joint operator accounts for its share of the assets, liabilities, revenue and expenses. Joint ventures arise where the investors have rights to the net assets of the arrangement; joint ventures are accounted for under the equity method. Proportional consolidation of joint ventures is no longer permitted.

The Directors reviewed and assessed the classification of the Group’s investment in The Victoria Falls Hotel Partnership in

accordance with the requirements of IFRS 11, “Joint Arrangements” and concluded that the Group’s investment in The Victoria Falls Hotel, which was classified as a joint venture under IAS 31, “Interest in Joint Ventures” and accounted for using the proportional consolidation method, is a joint operation under IFRS 11, therefore the Group continues to account for its share of assets, liabilities, income and expenses proportionately. Details of financial information is disclosed in note 8.

West African Sun Hotels Limited - significant influence The Group has 50% shareholding in West African Sun Hotels Limited (“WASHL”). Following the adoption of IFRS 11, “Joint

Arrangements” it was determined that the Group has significant influence over WASHL, and not joint control. The significant influence in the entity has been determined due to the following reasons;

-the Group has representation of two Board members to the WASHL Board, from a total of five; -the voting arrangement of WASHL does not require a unanimous agreement between the shareholders, hence no joint control; and -the chairman is an independent appointee.

Based on the above, the Group will account for its investment in WASHL in terms of IAS 28 (revised), “Investment in Associates”.

According to the revised standard, the key to the definition of an associate is “significant influence”, which is the power to participate in the financial and operating decisions of the investee but not control or joint control over those policies. Significant influence is presumed to exist where an entity holds more than 20% of the voting power.

In terms of IAS 28 (revised), “Investment in Associates”, entities with significant influence over an investee are required to account for their investments in an associate using the equity method. Before the adoption of IFRS 11, “Joint Arrangements”, the Group used to account for WASHL using the proportional consolidation method. The new standard has been applied retrospectively, to show the impact of accounting for WASHL using the equity method in terms of IAS 28 (revised), “Investment in Associates”.

The Group recognised its investment in the associate at the beginning of the earliest period presented (1 October 2012), as the total of the carrying amounts of the assets and liabilities previously proportionately consolidated by the Group. As at 30 September 2014, the investment was in a net liabilities position, hence a nil carrying amount in the books of the Group. Details of other financial information relating to the investment is shown under note 11.



Below is the impact of adoption of the new standard for the comparative periods:

US$ US$

AssetsDecrease in property and equipment (4 105) (5 864)Increase in trade and other receivables - 304 964 Decrease increase in cash and cash equivalents (1 255) (3 279)

Total (decrease) / increase in assets

LiabilitiesDecrease in trade and other payables

Decrease in revenue ( 308 036) ( 234 174)Decrease in operating expenses 94 029 196 676 Decrease in operating profit ( 214 007) ( 37 498)Decrease in income tax charge 116 113 -

Decrease in profit for the year

The reconciliation of the total carrying amounts of investments accounted for using the equity method is shown under note 11.



The Group incurred occupational rent amounting to US$1 875 767 during the prolonged fit out stage of the new hotel in Ghana. The occupational rent was paid in line with the lease agreement, though the hotel had not yet opened. The rent had been included as part of minimum lease payments which are capitalised and are amortised over the remaining lease period upon interpreting IAS 17, “Leases”. This treatment has now been considered as incorrect. As such the occupational rent paid during the prolonged fit out stage should have been expensed when it was incurred.

The Group incurred pre-opening expenses amounting to US$724 768 in respect of the new hotel in Ghana during the year

ended 30 September 2013. As per Group policy, pre-opening expenses were capitalised/deferred and written off in the first year of operation of a hotel. This policy was found to be in contradiction with the International Financial Reporting Standards. The impact of correcting the error is shown below:

US$costs

US$TotalUS$

AssetsDecrease in non-current receivables (1 636 029) - (1 636 029)Decrease in current receivables (90 891) (724 768) (815 659)Increase in deferred tax income assets 352 105 147 775 499 880

Total decrease in assets

Increase in operating expenses (1 875 767) (787 237) (2 663 004)Increase in income tax credit 352 105 147 775 499 880

Increase in loss for the year

Outstanding shares for basic earnings per share 823 940 874 823 940 874 823 940 874 Outstanding shares for diluted earnings per share 848 243 881 848 243 881 848 243 881

Increase in basic loss per share (US cents) (0.185) (0.078) (0.263)Increase in diluted loss per share (US cents) (0.180) (0.075) (0.255)Increase in basic headline loss per share (US cents) (0.185) (0.078) (0.263)Increase in diluted headline loss per share (US cents) (0.180) (0.075) (0.255)



The Group has a 50% interest in The Victoria Falls Hotel. The Victoria Falls Hotel is a leased hotel in the Victoria Falls area. The

following amounts represent the Group’s 50% share of the assets and liabilities, and sales and results of the joint ventures. They are included in the statement of financial position and statement of comprehensive income.

US$ US$

Assets-Non-current assets 2 971 498 1 363 237 -Current assets 4 219 744 2 626 768

Total assets

Liabilities-Current liabilities 1 158 789 306 806

Net assets

Results-Income 6 585 788 5 448 270 -Expenses (4 674 062) (4 072 617)

Profit before income tax

-

Joint venture commitments as at 30 September 2013 relate to refurbishment and other capital expenditure for The Victoria Falls Hotel.

GROUP

Freehold

US$

Leasehold

US$ US$

Servicestocks

US$

Motorvehicles

US$ US$TotalUS$

stated

Cost or valuation 4 526 600 5 569 746 20 736 155 2 065 566 1 400 449 4 932 293 39 230 809 Accumulateddepreciation andimpairment ( 140 480) (3 057 304) ( 8 649 218) ( 243 065) ( 568 003) - ( 12 658 070)Effects of change inaccounting policy - - ( 5 864) - - - ( 5 864)

restated 2 512 442



GROUP

Freehold

US$

Leasehold

US$ US$

Servicestocks

US$

Motorvehicles

US$ US$TotalUS$

Year ended

Opening net book amount 4 386 120 2 512 442 12 081 073 1 822 501 832 446 4 932 293 26 566 875 Additions - cost 12 000 203 635 2 154 444 687 576 64 771 4 879 610 8 002 036 Disposals - cost - - (125 373) - (103 250) (12 601) (241 224)Accumulated depreciation ondisposals - - 44 843 - 79 354 - 124 197 Transfer (out) / in - 1 214 926 4 756 555 (94 797) 3 121 (5 879 805) - Transfer to assets of a disposal group classified as held for sale - (4 234) (185 726) (2 321) - - (192 281)Accumulated depreciation on assets classified to assets classified to a disposal group - 2 070 69 875 - - - 71 945 Exchange differences - - - (1 745) - - (1 745)Depreciation charge (70 240) (494 779) (1 275 347) (207 247) (165 807) - (2 213 420)Closing net bookamount

Cost or valuation 4 538 600 6 988 307 27 512 471 2 411 214 1 365 091 3 919 497 46 735 180 Accumulated depreciation and impairment

(210 720)

(3 554 247) (9 992 127)

(207 247)

(654 456) - (14 618 797)

Net book amount

Year ended

Opening net book amount 4 327 880 3 434 060 17 520 344 2 203 967 710 635 3 919 497 32 116 383 Additions - cost - 423 318 1 502 265 507 134 352 432 1 158 483 3 943 632 Disposals - cost - - (599 612) - (108 872) (130 518) (839 002)Accumulated depreciation on disposals - -

311 394 -

75 686

-

387 080

Transfer (out) / in - 1 753 930 1 863 623 89 713 (4 732) (3 702 534) - Transfer to non-currentassets held for sale ( 4 257 640) - - - - - ( 4 257 640)Exchange differences - 2 965 27 168 ( 8 420) ( 27 547) ( 588 270) ( 594 104)Depreciation charge ( 70 240) ( 482 133) ( 1 910 462) ( 403 000) ( 212 259) - ( 3 078 094)

Closing net book amount -

Cost or valuation 4 538 600 9 168 520 30 305 914 2 792 394 1 576 372 656 658 49 038 458 Transfer to non-current assets held for sale (4 257 640)

- - - - -

( 4 257 640)

Accumulated depreciation and impairment

(280 960) (4 036 380)

(11 591 194) (403 000)

( 791 029) -

(17 102 563)

Net book amount -



COMPANY

Freehold

US$

Leasehold

US$ US$

Servicestocks

US$

Motorvehicles

US$ US$TotalUS$

Cost or valuation - - 26 275 - 365 893 4 458 537 4 850 705 Accumulated depreciationand impairment - - ( 5 214) - ( 84 153) - ( 89 367)

Net book amount - - -

Opening net book amount - - 21 061 - 281 740 4 458 537 4 761 338 Additions - - 45 850 - 8 500 3 725 926 3 780 276 Disposals to operating companies - - - - - ( 6 417 852) ( 6 417 852)Depreciation charge - - (6 861) - (58 011) - (64 872)

Closing net book amount - - -

Cost or revaluation - - 72 125 - 374 393 1 766 611 2 213 129 Accumulated depreciation and impairment - - ( 12 075) - ( 142 164) - ( 154 239)

Net book amount - - -

Opening net book amount - - 60 050 - 232 229 1 766 611 2 058 890 Additions - 125 111 112 267 - 252 969 2 700 493 047 Disposals - cost - - - - ( 17 750) ( 130 518) ( 148 268)Accumulated depreciation on disposals -

- - -

10 510 -

10 510

Disposals to operating companies - - - - - ( 1 606 092) ( 1 606 092)Depreciation charge - ( 4 170) ( 15 573) - ( 94 525) - ( 114 268)

Closing net book amount - -

Cost or revaluation - 125 111 184 392 - 609 612 32 701 951 816 Accumulated depreciation and impairment - ( 4 170) ( 27 648) - ( 226 179) - ( 257 998)

Net book amount - -

Freehold properties with a value of US$4 257 640 transferred to non-current assets held for sale relates to staff houses owned by the Group located in the Victoria Falls and Kariba areas.The freehold properties transferred to non-current assets held for sale during the year are pledged as security for a loan of US$1 939 537.

Capital work in progress relates to refurbishment equipment and hotel furniture, fittings and equipment for the Zimbabwe hotels that was undertaken during the financial year. This is not depreciated until it is brought to use.

During the year, the Group did not have any impairments (2013: US$nil).

All the depreciation is charged in administrative expenses in the statement of comprehensive income.

Motor vehicles with a total cost of US$239 500 (2013: US$nil) are on a finance lease where the Group is a lessee.

There were no contractual commitments for the acquisitions of property and equipment as at 30 September 2014 (2013: US$nil)

There were no borrowing costs capitalised during the year (2013: US$1 048 964) on qualifying assets. The qualifying assets arise from the refurbishment of leasehold improvements, new equipment and furniture and fittings. Hotel refurbishment generally takes a period of 24 months to complete, while a new hotel takes between 9 months to 12 months to complete the furnishing with the required items of furniture and fittings for the rooms to be ready for use. Borrowing costs were capitalised at the effective interest rate on the Ecobank Ghana loan of 17%.



If property and equipment was stated on the cost basis, the carrying amount would be as follows:

GROUP

Freehold

US$

Leasehold

US$ US$

ServiceStocks

US$

Motorvehicles

US$ US$TotalUS$

-

COMPANY

- -

- - -

An independent valuation of the Group’s property and equipment was last performed by Dawn Property Consultancy (Private) Limited to determine the fair value of the equipment as at 31 August 2011 and land and buildings as at 31 March 2013. The valuation which conforms to International Valuation Standars was determined by reference to recent market transactions on arm’s length terms. The following tables analyses the non-financial assets carried at fair value, by valuation method . The different levels of determinig the fair values have been defined as follows: -Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). -Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2). -Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).

in activemarkets for

identicalassetslevel 1

US$

Significant

other observable

level 2 US$

Significant unobservable

level 3 US$

TotalUS$

Recurring fair value measurements Leasehold improvements - - 5 132 140 5 132 140 Equipment - - 18 714 720 18 714 720 Motor vehicles - - 785 343 785 343

- -



US$

Significant

other observable

level 2 US$


level 3 US$

TotalUS$

Recurring fair value measurements Freehold properties - - 4 327 880 4 327 880 Leasehold improvements - - 3 434 060 3 434 060 Equipment - - 17 520 344 17 520 344 Motor vehicles - - 710 635 710 635

- -



There are no level 1 and level 2 assets and there were no transfers between level 1 and 2 during 2014 and 2013.

The tables below are reconciliations of the fair value measurements using significant unobservable inputs (level 3) for the year

ended 30 September 2014 and 30 September 2013:

Freehold

US$

Leasehold

US$ US$

Motor vehicles

US$TotalUS$

As at 1 October 4 327 880 3 434 060 17 520 344 710 635 25 992 919 Depreciation ( 70 240) ( 482 133) ( 1 910 462) ( 212 259) ( 2 675 094)Exchange differences - 2 965 27 168 ( 27 547) 2 586 Additions - 423 318 1 502 265 352 432 2 278 015 Disposals - at net book amount - - ( 288 217) ( 33 186) ( 321 403)Transfers to non-current assets held for sale ( 4 257 640) - - - ( 4 257 640)Transfers from capital work in progress - 1 753 930 1 863 623 ( 4 732) 3 612 821

-

As at 1 October 4 386 120 2 512 442 12 081 073 832 446 19 812 081 Depreciation ( 70 240) ( 494 779) ( 1 275 347) ( 165 807) ( 2 006 173)Additions 12 000 203 635 2 154 444 64 771 2 434 850 Disposals - at net book amount - - ( 80 530) ( 23 896) ( 104 426)Transfers to non-current assets held for sale - ( 2 164) ( 115 851) - ( 118 015)Transfers from capital work in progress - 1 214 926 4 756 555 3 121 5 974 602

Property and equipment is stated at fair value based on periodic valuations by the independent external valuers, less subsequent

accumulated depreciation and impairment losses. Valuations are performed with sufficient regularity to ensure that the fair value of a revalued asset does not differ materially from its carrying amount. As at 30 September 2014, the fair values of the property and equipment were based on the fair values which were determined by Dawn Property Consultancy (Private) Limited Valuers, a related party.

The valuation was completed using the market approach, which is the estimated amount for which an asset should exchange hands on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion for all the categories.



Set out in the table below is information about fair value measurement using significant unobservable inputs (level 3):

Fair value as as at

US$Valuation technique

Unobservable

Range of unobservable unobservable

valueFreehold 5 132 140 Recent sale Estimated US$18 000- The higher the

properties transactions in sale price of US$54 000 price per house the same area a house the higher the

fair value

Leasehold 18 714 720 Recent Costs of Inputs include The higher the improvements cost of doing different items labour, paint, cost of the

the same required to carpets, inputs, the improvements furnish the designs and higher the fair

hotels construction value materials

Equipment - Willing buyer Prices of Wide price The higher the willing seller second hand range as the the unit price

(recent market or used items category of the items of transactions on of equipment comprises equipment,

similar items) various items the higher the of equipment fair value

Motor 785 343 Willing buyer Prices of US$8 000- The higher the vehicles willing seller second hand US$120 000 the price per

(recent market or used vehicle transactions vehicles the higher the

on similar fair value vehicles)

The Group owns biological assets in the form of a timber plantation. The timber is held mainly for sale as raw timber on maturity.

The total area under the timber plantation as at 30 September 2014 is approximately 567 hectares (2013: 567 hectares).

US$ US$

Mature (trees which are 18 years and older) 163 900 119 572 Immature (trees which below 18 years) 89 815 101 079

The following table presents the group’s biological assets that are measured at fair value, at 30 September 2014.

Level 1US$

Level 2 US$

Level 3 US$

TotalUS$

-mature - - 163 900 163 900 -immature - - 89 815 89 815

- -



The following table presents the Group’s biological assets that are measured at fair value at 30 September 2013.

Level 1US$

Level 2 US$

Level 3 US$

TotalUS$

-mature - - 119 572 119 572 -immature - - 101 079 101 079

- -

There were no transfers between any levels during the year. The reconciliation in the fair value of the assets within level 3 of the hierarchy is follows:

Timber Plantation US$ US$

As at 1 October 220 651 274 678 Gain / (loss) from changes in fair value less estimated point of sale costs 33 064 ( 54 027)

Total gains / (losses) for the period included in the statement of comprehensiveincome for assets held at the end of the reporting period, under"change in fair value of biological assets"

The following unobservable inputs were used to measure the fair value of the Group’s timber plantation:

Fair value as as at

US$Valuation technique

Unobservable

Range of unobservable unobservable

value

Timber plantation 253 715 Faustmann Age of the 7 years and older The older theimprovements model trees trees, the higher

the same the value improvements Discount/risk 15% The higher the

rate materials discount/riskrate, the lower

the value

There were no harvests during the year (2013: US$nil)

There are biological assets with restricted title or pledged as collateral (2013: US$nil)

There are no commitments for the development or acquisitions of biological assets (2013: US$nil)

The Group is exposed to risks arising from fire, diseases, environmental changes and climatic changes. To manage these risks, the Group has insured the plantation for the sum of US$253 715 (2013: US$220 651).



11 INVESTMENTS

COMPANY GROUP

US$ US$ US$ US$

Investments accounted for using the equity method (note 11.2)-investment in associate - 5 975 065 - 6 067 253 Investment in subsidiaries (note 11.3) 24 701 731 24 701 731 - -

-

COMPANY GROUP

US$ US$ US$ US$

As at 1 October 5 975 065 13 696 029 6 067 253 17 588 834 Share of profit for the year - - 274 315 331 034 Fair value adjustment on reclassification tonon-current assets held for sale ( 41 046) (1 531 769) ( 80 649) (3 210 684)Classified to non-current assets held for sale (note 12) (3 171 087) (4 224 720) (3 171 087) (4 224 720)Dividend received ( 39 603) - ( 39 603) - Impairment (2 723 329) (1 964 475) (3 050 229) (4 417 211)

- -

As at 30 September 2014, African Sun Limited owned 16.54% (2013: 28.54%) of the linked units in Dawn Properties Limited. The 16.54% is accounted for as non-current assets held for sale following the shareholders’ approval to dispose that was granted in March 2014 at a price of US$0.0147 per share. The carrying amount transferred to non-current assets held for sale was determined using the market price of US$0.008 per share as at 30 September 2014.

Dawn Properties Limited has a 31 March financial year end. The share of results of Dawn Properties Limited is based on audited financials for the year ended 31 March 2014, and unaudited results for the six months ended 30 September 2014.

The investment in Dawn Properties Limited was accounted for using the equity method in the financial statements of the Group and at cost in the Company statement of financial position up to 30 September 2014.



The summarised pro-forma financial statements of Dawn Properties Limited for the 12 months ended 30 September 2014 are as follows:

US$ US$

Non-current assets

Current assetsCash and cash equivalents 2 127 817 1 604 770 Other current assets 954 150 850 670

Total current assets

Current liabilitiesTrade and other payables ( 374 471) ( 489 326)Current income tax liabilities - ( 33 511)

Total current liabilities

Non-current liabilitiesDebentures (1 590 696) (1 590 696)Other liabilities ( 576 386) ( 703 677)

Total non-current liabilities

Net assets

Revenue 5 464 707 5 755 565 Administrative expenses (4 186 787) (4 060 865)

Operating profit 1 277 920 1 694 700 Other income 655 214 16 827

Profit before income tax 1 933 134 1 711 527 Income tax credit / (expense) 36 393 ( 126 693)

Profit from continuing operations 1 969 527 1 584 834 Loss from discontinued operations - ( 655 526)

Profit for the year

Total assets comprise mainly investment properties, which predominantly constitute hotel properties which are leased and operated by African Sun Limited.

As at 30 September 2014 the fair value of the investment in Dawn Properties Limited based on the market price per share was

US$3 251 736 (2013: US$4 064 670).

US$ US$

As at 1 October - - Share of profit - -

- -

The joint venture listed below has share capital consisting solely of ordinary shares, which is held directly by the Group.



Nature of investment in joint venture 2014 and 2013

Name of entityCountry of

interest Nature of the Measurement

methodWest African Sun Hotels Limited Nigeria 50 Note 1 Equity

Note 1: WASHL provides hotel management services to hotels under management contracts in Nigeria. WASHL is a strategic

investment of the Group, providing access to new hotel projects in Nigeria.

WASHL is a private limited company and there is no quoted market price available for its shares.

The Group has no commitments and contingent liabilities relating to its joint venture.

Summarised financial information for West African Sun Hotels Limited Set out below is the summarised unaudited financial information for West African Sun Hotels Limited which is accounted for using the equity method.

US$ US$

Non-current assets

Current assetsCash and cash equivalents 4 418 6 088 Other current assets 874 256 1 202 521

Total current assets

Total assets

Current liabilitiesAmounts owed to related parties (1 139 144) (1 131 219)Statutory liabilities ( 376 481) ( 105 563)Other liabilities ( 74 623) ( 486 914)

Total current liabilities

Net liabilities

Management fees earned 434 833 616 072 Operating expenses ( 633 439) ( 188 060)(Loss) / profit before income tax ( 198 606) 428 012 Income tax expense - ( 232 224)

The joint venture uses the same accounting policies as the Group.

Reconciliation of summarised financial informationReconciliation of the summarised financial information presented to the carryingamount of its interest in the joint venture.

Summarised financial informationOpening net liabilities as at 1 October ( 506 879) ( 702 667)(Loss) / profit for the year ( 198 606) 195 788

Closing net liabilities

- -



For the year ended 30 September 2014, the Group has not recognised losses from West African Sun Hotels Limited amounting to US$99 303 (2013: profit for the year amounting to US$97 894). Cumulatively, unrecognised losses as at 30 September 2014 amounted to US$352 742 (2013: US$253 440).

COMPANY GROUP

US$ US$ US$ US$

At acquisition 2 681 780 682 000 - - Shareholders' loan 4 195 077 6 194 857 - -

Total investment in African Sun Limited PCC(Mauritius) - -

At acquisition 8 890 147 4 630 991 - - Shareholders' loan 8 934 727 13 193 883 - -

Total investment in African Sun Zimbabwe (Private) Limited - -

Total investment in subsidiaries - - Loan to African Sun Zimbabwe (Private) Limited carries interest at 7.5% per annum, while that to African Sun Limited PCC

(Mauritius) bears no interest. All loans to subsidiaries are unsecured and do not have fixed repayment dates, but are not expected to be repayed within the next twelve months.

The investments in subsidiaries were not impaired during the year (2013: US$nil).



The Group had the following subsidiaries as at 30 September 2014:

Name

Country of

businessImmediate Nature of

Business

ordinary shares directly held by shares held by the

African Sun Zimbabwe (Private) Limited

Zimbabwe African Sun Limited

African Sun Limited

Hotel and Catering

100 100

African Sun P.C.C Limited

Mauritius African Sun Limited

African Sun Limited

Holding Company 100 100

African Sun Ghana (Private) Limited

Ghana African Sun Limited

African Sun Hotels Limited

Hotel and Catering

100 100



African Sun P.C.C Limited


African Sun Hotels Investments Holdings Limited




African Sun Hotels Limited Branch

Mauritius/ Republic of South

Africa

African Sun Limited



African Sun South Africa (Proprietary) Limited

Republic of South Africa

South Africa

African Sun Limited

African Sun Hotels

Investments Holdings Limited

Holding Company (Dormant)

100 100

The Grace Hotel (Proprietary) Limited

Republic of South Africa

African Sun Limited

African Sun South Africa (Proprietary)

Limited

Dormant 100 100

Leisure and Hotels Botswana(Private) Limited

Botswana African SunLimited

African SunHotels Limited

Dormant 100 100

All subsidiary undertakings are included in the consolidation. The proportion of the voting rights in the subsidiary undertakings held directly by the parent company do not differ from the proportion of ordinary shares held.



12 NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

The Group’s non-current assets held for sale comprise the following:

COMPANY GROUP

US$ US$ US$ US$

12% investment in Dawn Properties Limited - 4 224 720 - 4 224 720 16.54% investment in Dawn Properties Limited 3 171 087 - 3 171 087 - Freehold properties - transferred from property and equipment - - 4 046 430 - Assets of a disposal group classified as held for sale - - 129 661 129 661

The details of the non-current assets held for sale are disclosed in (a) to (c) below.

During the year the Group classified as held for sale its fixed property (staff houses) and the 16.54% shareholding in Dawn

Properties Limited following approval by the Board. Following the active marketing of the properties by management, there was an expression of interest in buying the houses from a local consortium who have an interest in investing in the Victoria Falls area. To complement the aforementioned efforts, management has also engaged in discussions with several pension funds with regards the disposal of the houses. In preparation for the sale, management have done a rental annuity assessment of the houses, which is being used in the negotiations. The rental annuity assessment was done by Dawn Property Consultancy (Private) Limited. The proceeds from the disposals will be used to repay borrowings.

The disposal of the staff houses is expected to be completed by 30 September 2015.

The 16.54% investment in Dawn Properties Limited disposal was approved at a price of US$0.00147 per share. Subsequent to year end, a disposal of 69 749 322 shares was completed on 17 December 2014 at a price of US$0.0147 per share. The disposal of the remaining investment is expected to be completed before 30 September 2015.

In 2013, the Group reclassified the assets of Fothergill Island to assets and liabilities of a disposal group, following approval

of recommendations to the Board. The decision to discontinue the operations and sell the operating assets was based on the following reasons;

-capital requirements to refurbish the hotel are onerous on the Group, making recovery of invested capital difficult; and -with the Group’s changing business model, the nature of the hotel is not a right fit.

Negotiations between management and an interested party to sell the assets and liabilities are ongoing and the disposal will be completed during the financial year ended 30 September 2015.

The hotel has been non-operational since 2011, and there are no associated incomes and expenses, cash flows and liabilities. Below is an analysis of the assets classified as held for sale;

COMPANY GROUP

US$ US$ US$ US$

for saleProperty and equipment - - 120 334 120 334 Inventory - - 9 327 9 327 Total assets of a disposal group classified as held for sale - -



The disposal was not completed during the 2014 financial year due to shareholder changes. The changes resulted in termination

of the first disposal agreement, as the new shareholders wanted to understand the entire business model before finalisation of the disposal. The disposal is expected to be go through before 30 September 2015.

The freehold properties have been valued at fair value. The fair value was determined using significant unobsavable inputs (level

3), less costs to sale. The fair value less costs to sale was determined to be US$4 046 430.

The fair value of the 16.54% investment in Dawn Properties Limited was determined using quoted prices in active markets for identical assets, which is the Zimbabwe Stock Exchange (level 1). For the portion that was classified as non-current assets held for sale as at 30 September 2013, the fair value was determined using significant unobsable inputs, which was the agreed selling price (level 3).

The assets of a disposal group classified as held for sale have been valued at fair value and no associated disposal costs are expected. This is a non-recurring fair value which has been measured using unobservable inputs, being the depreciated replacement cost of similar assets, and is therefore within level 3 of the fair value hierarchy.

Fair value measurements using

Quoted



US$

Significant other

observable

level 2 US$


level 3 US$

TotalUS$

Non-recurring fair value measurementsFreehold properties - transferred from property and equipment - - 4 046 430 4 046 430 16.54% investment in Dawn Properties Limited 3 171 087 - - 3 171 087 Assets of a disposal group classified as held for sale - - 129 661 129 661

-

Non-recurring fair value measurements12% investment in Dawn Properties Limited - - 4 224 720 4 224 720 Assets of a disposal group classified as held for sale - - 129 661 129 661

- -

Below is the Group’s reconciliation of the fair values of non-current assets held for sale:

COMPANY GROUP

US$ US$ US$ US$

As at 1 October 4 224 720 - 4 354 381 - Assets classified as held for sale from investment in associate (note 11) 3 171 087 4 224 720 3 171 087 4 224 720 Assets classified as held for sale from property and equipment (note 9) - - 4 257 640 - Fair value adjustment on freehold properties - - ( 211 210)Sold during the year (4 224 720) - (4 224 720) - Total assets of a disposal group classified as held for sale - - - 129 661



13 FINANCIAL INSTRUMENTS

Financial instruments by category:

COMPANY GROUP

US$ US$ US$ US$

Trade and other receivables (excludingpre-payments and deferred expenditure) 2 336 697 1 598 957 6 661 145 7 976 104 Loans advanced to subsidiaries (note 11) 13 129 804 19 388 740 - -

Cash and cash equivalents 161 186 989 319 2 734 576 4 229 079

Total

Borrowings 3 998 351 8 068 288 17 348 745 22 320 973 Trade and other payables (excluding statutory liabilities) 1 014 119 2 696 073 9 116 207 9 721 325

Total

14 INVENTORIES

COMPANY GROUP

US$ US$ US$ US$

Food and beverage - - 908 077 898 871Shop merchandise - - 67 737 72 644 Consumable stocks 6 110 51 999 354 467 502 773 Maintenance stocks - - 314 211 169 373

1 643 661

The cost of inventories recognised as expense and included in “cost of sales” amounted to US$5 522 995 (2013: US$5 394 011).

Items of inventory amounting to US$42 859 were impaired during the year (2013: US$nil).



15 TRADE AND OTHER RECEIVABLES

COMPANY GROUP

US$ US$ US$ US$

Trade receivables - - 4 638 998 4 960 937 Less: allowance for impairment - - ( 307 766) ( 269 810)Trade receivables - net - - 4 331 232 4 691 127 Prepayments 18 000 - 285 380 299 085 Amount receivable from a joint operations partner - - 168 739 799 969 PAYE and VAT refundable - South Africa entities - - 199 797 121 195 Other receivables 36 953 897 639 463 579 1 225 017 Receivables from related parties (note 30) 1 718 424 209 089 1 040 960 1 024 495 Staff receivables 581 320 492 229 656 635 541 836

Less non-current portion:Receivables from related parties (note 30) 255 582 209 089 255 582 209 089 Staff receivables 356 464 317 285 356 464 317 285

Total non-current

Current portion

All non-current receivables are due within ten years from the end of the reporting period.

The carrying amounts of trade and other receivables approximates their fair value as the impact of discounting is not significant.

The fair value of staff debtors and receivables from related parties is based on cash flows discounted using the Group’s average cost of borrowing of 13.20% (2013: 13.83%). The loans relate to car loans which are payable over 5 years and housing loans which are payable over 20 years.



The effective interest rates on non-current receivables were as follows:

COMPANY GROUP

US$ US$ US$ US$

Receivables from related partiesStaff receivables

As at 30 September 2014, trade receivables ofUS$2 584 584 (2013: US$3 137 582) were fully performing.

As at 30 September 2014 trade receivables ofUS$1 746 648 (2013: US$1 553 545) were past due but not impaired. These relate to a number of independent customers from whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:Up to 30 days - - 858 653 611 395 30 to 60 days - - 343 560 292 311 Over 60 days - - 544 435 649 839

- 1 553 545

As at 30 September 2014, trade receivables ofUS$307 766 (2013: US$269 810) were impaired and fully provided for. The individually impaired receivables mainly relate to customers in difficult economic situations. The ageing analysis of these trade receivables is as follows:Over 60 days - -

The carrying amounts of the Group's trade and other receivables are denominated in the following currencies:United States of America dollars 2 354 697 1 598 957 6 543 875 7 883 373 South African Rand - - 248 842 130 885 Botswana Pula - - 112 321 112 321 Ghanian Cedi - - 241 284 2 600 298

Movements on the Group’s allowance for impairment of trade receivables are as follows

As at 1 October - - 269 810 399 485 Allowance for receivables impairment - - 116 936 58 404 Receivables written off during the year as uncollectible - - ( 78 980) ( 188 079)

- -



The creation and release of allowance for impaired receivables have been included in “other expenses” in the statement of comprehensive income. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash.

The other classes within trade and other receivables contain impaired assets whose impairment has been disclosed separately in note 25.

The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivables mentioned above. The Group does not hold any collateral as security.

Debtors amounting to US$952 281 were pledged as security to a short-term loan of US$1 532 227.

16 CASH AND CASH EQUIVALENTS

COMPANY GROUP

US$ US$ US$ US$

Cash at bank and on hand

The net exposure to foreign currency balances was:United States of America dollars 144 950 969 286 1 733 472 3 180 207 South African Rand 16 236 20 033 930 227 969 961 Botswana Pula - - 6 396 -Euro - - 58 849 36 667 Australian Dollars - - 1 080 9 317 Ghanaian Cedi' - - 4 552 32 927

The carrying amount of the cash and bank balances approximate their fair value. Cash and cash equivalents includes a restricted balance of US$369 453 (2013: US$552 668) held in an offshore account by

Afreximbank as part of the security to the loan. This is 8% of the outstanding loan balance. The cash is available to the extent that the balance is equal to or more than 8% of the loan outstanding.

Cash and cash equivalents comprise the following for the purposes of the statement of cash flows:

US$ US$

Cash and bank balances 2 734 576 4 229 079 Bank overdrafts (note 22) (1 261 632) (2 068 288)Less: restricted cash ( 369 453) ( 552 668)

Cash and cash equivalents



Numberof shares

Ordinary

US$

US$

Tresasury shares

US$ Total US$

823 940 874 8 314 729 24 734 304 - 33 049 033 Treasury shares (7 532 079) - - ( 205 713) ( 205 713)

816 408 795 8 314 729 24 734 304 ( 205 713) 32 843 320 Sale of treasury shares 7 532 079 - - 205 713 205 713

-

The total authorised number of ordinary shares is 1,5 billion (2013: 1,5 billion) with a par value of US$0.01 per share.

All issued shares are fully paid.

The unissued shares are under the control of the Directors, subject to the limitations imposed by the Articles and Memorandum of Association of the Company, the Zimbabwe Stock Exchange Listing Requirements and the Zimbabwe Companies Act (Chapter 24:03).

Numberof shares

Otherreserves

US$

Accumulated losses

US$ Total US$

7 532 079 ( 753 203) - ( 753 203)Treasury shares sold (7 532 079) - - - Proceeds from disposal of treasury shares - 205 713 - 205 713 Loss from disposal of treasury shares - 547 490 ( 547 490) -

- -

During the year the Company reclassified treasury shares previously netted off against ordinary shares and share premium in order to appropriately disclose the impact of acquisition and the disposal of the treasury shares. The disposal of treasury shares with a value of US$735 203 for US$205 713 resulted in a loss on disposal of US$547 490. The loss was written off against accumulated losses.

As at 30 September 2014, no directors held shares directly in the Company.

During 2013, Dr S A Munyeza relinquished his 31.99% shareholding in African Sun Limited through Nhaka Trust to Lengrah Investments (Private) Limited trading as BCM Hotel and Real Estate following a cash and share swap transaction in lieu of a 17.02% shareholding in Brainworks Capital Management (Private) Limited (“BCM”). Lengrah is a subsidiary of BCM, with BCM controlling 68%.



Share options are granted to directors and selected employees. The exercise price of the granted options is equal to the market

price on approval date which is also the grant date. Options are conditional on the employee completing three years’ service (the vesting period). The options are exercisable starting three years from the grant date, without additional performance and market conditions. The Group has no legal or constructive obligation to repurchase or settle the options in cash.

There were no share options granted during the year. Below are the movements and related weighted average exercise price of the outstanding share options that were granted in 2013:

Exercise Exercise

As at 1 October 1.50 32 926 655 - - Granted - - 1.50 32 926 655

-

None of the outstanding share options were exercised during the year.

The expiry date of all the share options outstanding as at 30 September 2014 is 30 June 2016.

The weighted average fair value of options granted determined using the Black-Scholes valuation model was US$0.0074 per option. The significant inputs into the model are as discussed in note 4.1 (f).

Other reserves include non-distributable reserve which arose as the net effect of the restatement of assets and liabilities previously denominated in Zimbabwe dollars on 1 February 2009, treasury shares and equity settled share based payments

reserve.

The Group has a share option scheme, where employees are given the option to buy the Company’s shares at the end of the defined vesting period. The accrued value of employee services is credited to this equity settled share based payments reserve until such time the options are exercised.

On consolidation, exchange differences arising from the translation of transactions and balances of foreign operations which are different to the Group’s presentation currency are taken to the foreign currency translation reserve.

The revaluation reserve relates to revaluations of property and equipment, and share of revaluation reserves from the associates and joint ventures.



Otherreserves

US$

Foreigncurrency

translationreserve

US$

Revaluationreserve

US$

Accumulated losses

US$ Total US$

5 135 328 ( 946 582) 430 871 (14 788 708) (10 169 091)Effect of change in accounting policy (note 6) - ( 91 984) - 485 415 393 431

5 135 328 (1 038 566) 430 871 ( 14 303 293) (9 775 660)Loss for the year as previously stated - - - ( 6 568 454) (6 568 454)Effect of change in accounting policy (note 6) - - - (97 895) (97 895)Effects of correcting the prior period error (note7) - - - ( 2 163 124) (2 163 124)Currency translation differences from subsidiaries - ( 30 092) - - ( 30 092)Recycled to profit or loss - - ( 181 165) - ( 181 165)Value of employee services 20 171 - - - 20 171

5 155 499 (1 068 658) 249 706 23 137 766 18 796 219Loss for the year - - - (2 285 702) (2 285 702)Currency translation differences from subsidiaries - (1 440 336) - - (1 440 336)Recycled to profit or loss - - ( 249 706) - (249 706)Value of employee services 80 685 - - - 80 685 Proceeds from disposal of treasuryshares 205 713 - - - 205 713 Loss from disposal of treasury shares

547 490 - - ( 547 490) -

Transfer to accumulated losses (4 614 610) - - 4 614 610 -

-

The transfer from non-distributable reserve to accumulated losses was done following approval by the Board. The non-distributable reserve arose following dollarisation in 2009. The remaining amount of US$1 273 921 relates to The Victoria Falls Hotel, which is jointly managed. The other partner requires the same approval to reclassify, and this will be completed by

30 September 2015.

Revaluation reserve of US$249 706 relates to revaluation reserve from Dawn Properties Limited (associate). The recycling to profit or loss arose following the classification of the 16.54% investment in Dawn Properties Limited to non-current assets held for sale.



COMPANY GROUP

US$ US$ US$ US$

Trade payables 465 809 - 2 919 584 2 226 342 Amounts due to related parties (note 30) - 1 113 536 283 381 397 372 Statutory liabilities 4 383 052 4 541 420 5 617 239 5 909 357 Accruals 265 026 221 848 2 731 790 2 991 637 Guests deposits - - 1 735 428 1 445 190 Rent liability for The Lakes Hotel - - 634 351 706 979 Other payables 283 284 1 360 689 811 673 1 865 411

Less non-current:Other payables - statutory liabilities on a payment plan 2 203 358 1 758 132 2 203 358 1 758 132

Current

Statutory liabilities relate to pay as you earn (“PAYE”), pension obligations, value added tax (“VAT”) and tourism levy.

Statutory liabilities under non-current liabilities are payable in 58 months. The increase in repayment was a result of accrued liabilities during the financial year ended 30 September 2014 and the new agreed payment terms.

21 PROVISIONS

Provisions are recorded when the Group has a present legal or constructive obligation as a result of past events, for which it is probable that an outflow of economic benefits will occur, and where a reliable estimate can be made of the amounts of the obligations. A reliable estimate is the amount the Group would rationally pay to settle the obligation at the reporting date.

The provisions balance is made up of the following:

GROUP

Balance at

US$

Current

US$

Utilised/reversed

US$

Balance at

US$

Leave pay 749 463 - ( 240 295) 509 168 Contractual claims 364 467 - - 364 467

-

COMPANY

Leave pay 215 444 -

This amount is the Group’s liability to pay employees for their annual leave days. Current provision is included in the statement of comprehensive income under ‘administrative expenses’. The amount represents a provision payable to a counterparty arising from a service contract. The counterparty has made an

additional claim against the Group. After obtaining legal advice, the outcome of the legal claim will not give rise to any loss beyond the provision provided for.



22 BORROWINGS

COMPANY GROUP

US$ US$ US$ US$

Non-currentForeign bank loans - - 3 524 875 4 207 553 Finance lease liability 35 139 - 35 139 - Local bank loans - - 3 182 781 3 885 514

Total non-current -

CurrentBank overdrafts 312 218 2 068 288 1 261 632 2 068 288 Foreign bank loans - - 3 087 500 4 148 987 Finance lease liability 138 494 - 138 494 - Local bank loans 3 512 500 6 000 000 6 118 324 8 010 631

Total current

Total borrowings

Current bank borrowings of US$10 605 950 comprise:- US$2 569 984 local loans which were renewed during the year and will be due for renewal in 2015;- an expired local facility of US$2 229 660 which was restructured post year end with new repayment terms included in the

maturities profile. As at 31 December 2014, the Group had paid US$1 350 000 towards the facility; - an expired local facility of US$1 457 174 which is in the process of being restructured. As at 31 December 2014, the Group had paid US$520 000 towards the facility based on a tentative agreement pending finalisation of a new facility;- US$138 494 current portion of the finance lease liability;- US$1 180 357 overdrafts from local banks;- US$81 275 overdraft from a Ghanian bank; and- US$2 500 000 current portion of the long-term refurbishment loan.

Local bank loans including overdrafts bear an average interest cost of 16.57% annually (2013: 16.89%).

Current foreign bank loans are part of long-term loans structures and have the same terms as defined in the long-term portions of the same loans.

Current bank borrowings include US$1 532 277 secured loans (2013: US$7 600 000). The loans are secured by;- cession of debtors amounting to US$952 281;- deed of pledge of funds in foreign currency accounts; and- unlimited guarantee by African Sun Zimbabwe (Private) Limited.

Non-current bank borrowings of US$6 742 795 are:- US$2 301 072 Ghanian medium term loan which bears interest at 12.5% (2013: 11%), and is payable over 4 years. US$587 500

of the loan is classified under current. The loan is secured by a bank guarantee from a Zimbabwean bank;- US$4 311 303 (2013: US$6 707 553) a foreign refurbishment loan bearing interest at LIBOR plus 7% (2013: LIBOR plus 7%) and

is payable over 5 years. US$2 500 000 of this loan is classified under current. The loan is secured by a bank guarantee from a local bank amounting to US$4 700 000, a cash deposit of US$369 453 and an African Sun Limited guarantee. During the year, the Group repaid US$2 494 524 (2013: US$2 494 524) in principal towards the refurbishment facility;

- US$1 939 537 local bank loan bearing interest at 6.7% per annum (2013: 6.7%). The loan is secured by fixed property and is paid as a bullet on 31 December 2015;

- US$1 243 243 local bank loan bearing interest at 15% per annum (2013: 15%). The loan is unsecured and is payable over 3 years from 1 September 2014 with a final maturity date of 31 August 2017. The first instalment which was due on this loan

was paid on 30 September 2014; and - US$35 139 non-current portion of the finance lease liability.



The maturity profile of the Group’s borrowings are as follows:

COMPANY GROUP

US$ US$ US$ US$

Up to one month 336 259 3 290 681 481 970 3 290 681 Later than one month, but not later than three months 1 023 082 531 988 2 294 106 2 659 105 Later than three months, but not later than six months 1 034 623 13 204 2 118 659 2 520 965 Later than six months, but not later than nine months 34 623 - 1 268 659 1 006 652 Later than nine months, but not later than one year 1 534 623 4 232 415 4 442 554 4 750 503 Later than one year, but not later than five years 35 141 - 6 742 797 8 093 067

The Group has put in place measures to ensure that the maturities will be paid when due. These measures are as discussed

under going concern (note 2.1.2). Below is a summary of the measures:

-loan facilities with a total amount of US$2 700 000 were renewed for another year in November 2014;

-the Company signed a new facility for a total sum of US$3 000 000 to ensure that there are adequate undrawn facilities to meet

maturities;

-disposal of fixed property (note 12);

-disposal on the 16.54% investment in Dawn Properties Limited (note 12); and

-disposal of timeshare weeks for a new 25 year period.

The exposure of the Group’s borrowings to interest rate changes and the contractual repricing dates at the end of the reporting

period are as follows:

COMPANY GROUP

US$ US$ US$ US$

6 months or less 2 393 964 3 835 873 4 894 735 8 470 751 6-12 months 1 569 246 4 232 415 5 711 213 5 757 155 1-5 years 35 141 - 6 742 795 8 093 067

The carrying amounts of the Group’s borrowings approximate their fair values as the impact of discounting is insignificant.

The Group’s bank loans are denominated in the following currencies:

COMPANY GROUP

US$ US$ US$ US$

United States of America dollars

The Group has the following undrawn borrowing facilities:Floating rate- Expiring within one year - - - 1 000 000Fixed rate- Expiring after one year 3 000 000 - 3 000 000 701 013

-



23 INCOME TAXES

US$ US$

Current income tax:Income tax on current year profits - - Withholding tax - -

- - Deferred income tax:Originating and reversal of temporary differences ( 818 883) 23 537

Income tax expense

The tax on the Group’s profit before income tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to profits of the consolidated entities as follows:Loss before income tax

Tax calculated at domestic tax rates applicable to profits in the respective countries ( 374 925) ( 1 873 393)

Tax effects of:-Equity accounted earnings reported net of tax ( 70 636) ( 110 449)-Income not subject to tax ( 99 354) ( 131 891)-Expenses not deductible for tax purposes 267 554 2 139 270 -Utilisation of previously unrecognised tax losses ( 541 522) -

The weighted average applicable tax rate was 24.52% (2013: 25.75%). The applicable tax rates in the different countries for the year were; -Zimbabwe 25.75% (2013: 25.75%); -South Africa 28% (2013: 28%); -Ghana 20% (2013: 20%); and -Nigeria 30% (2013: 30%).



The analysis of deferred income tax assets and deferred income tax liabilities is as follows:

COMPANY GROUP

Dilluted income tass assests US$ US$ US$ US$

-Deferred income tax assets to be recovered after more than 12 months - 432 151 1 031 788 289 766

-Deferred income tax assets to be recovered within 12 months 225 933 55 477 834 096 1 055 330

Deferred income tax liabilities-Deferred income tax liabilities to be recovered after more than 12 months 78 969 224 593 4 262 022 4 931 395

-Deferred income tax liabilities to be recovered within 12 months 27 387 16 737 889 106 517 828

The gross movement on the deferred income tax account is as follows:As at 1 OctoberStatement of comprehensive income charge / (credit) 126 721 ( 216 658) ( 818 883) 23 537

The movement in deferred income tax assets and liabilities during the year, without taking into consideration the offsetting of balances within the same tax jurisdiction, is as follows:

Deferred income tax liabilities

GROUP

Acceleratedtax

US$Other

US$ Total

US$

4 683 265 210 425 4 893 690 Charged / (credited) to statement of comprehensive income 618 754 ( 63 221) 555 533

5 302 019 147 204 5 449 223 (Credited) / charged to statement of comprehensive income ( 449 436) 151 341 ( 298 095)

COMPANY

341 680 - 341 680 Credited to statement of comprehensive income ( 152 827) - ( 152 827)

188 853 - 188 853 Credited to statement of comprehensive income ( 82 497) - ( 82 497)

-



Deferred income tax assets

GROUPProvisions

US$Tax losses

US$Total US$

( 140 078) (673 022) ( 813 100)Charged / (credited) to statement of comprehensive income 84 601 (616 597) ( 531 996)

( 55 477) (1 289 619) ( 1 345 096)Charged / (credited) to statement of comprehensive income 25 655 (546 443) ( 520 788)

COMPANY

- 374 320 374 320 Credited to statement statement of comprehensive income - 60 831 60 831

- 435 151 435 151 (Charged) / credited to statement of comprehensive income 25 861 ( 235 079) ( 209 218)

Deferred income tax assets are recognised for tax loss carry-forwards to the extent that the realisation of the related tax benefit through future taxable profits is probable. Based on forecasts, Directors are of the opinion that, the taxable profits will offset the current deferred tax asset.

The Group recognised deferred income tax assets for all tax losses incurred in 2014 and 2013.

Tax losses amounting to US$2 335 513 and US$372 679 expire in 2019 and 2020 respectively. Provisionally assessed tax losses amounting to US$1 938 285 (ZAR21 852 147) relating to a South African Branch have an indefinite expiry period, as long as the Branch continues in operation each year for a continuous period of 12 months. A total deferred income tax asset of

US$541 522 (ZAR6 102 345) has been recognised in lieu of the assessed tax losses. The remeasurement of the deferred income tax asset is attributable to the profits that will be made by the South African entity. For the year ended 30 September 2014, the entity posted an assessed profit of ZAR4 485 606. The total deferred income tax asset relating to foreign subsidiaries for the year ended 30 September 2014 was US$903 783 (2013: US$499 880).

24 EMPLOYEE PENSION COSTS The Group and all employees contribute to one or more of the following independently administered defined contribution pension funds:

This fund is a defined contribution scheme. All employees, except those who are members of the Catering Industry Pension

Fund are members of this fund. The Group temporarily suspended pension contributions with effect from 1 October 2014 with the view of not accumulating a further liability towards the fund. The suspension was approved by the pension fund trustees, and the pensions and insurance regulator. Contributions to the fund will resume when the outstanding pension obligations have been cleared.

This is a defined contribution scheme which covers employees in specified occupations of the catering industry. The majority of

employees of African Sun Limited are members of this fund.



The Group and all its employees based in Zimbabwe contribute to the NSSA scheme, promulgated under the National Social

Security Act 1989. The Group’s obligations under this scheme are limited to specific contributions legislated from time to time.

The subsidiary company has a defined contribution provident fund, of which full time employees of the branch are members.

This is a pension fund managed by a private trustee on behalf of employees. Both employer and employees contribute to this

fund. The fund is a defined contribution plan.

This a statutory Government pension fund for all employees. All employees of African Sun Ghana are members of this fund. The

Group’s obligations under this scheme are limited to specific contributions legislated from time to time.

Group contributions to the plans during the year charged to the statement of comprehensive income amounted to;

US$ US$ African Sun Limited Pension Fund 658 058 681 097 Catering Industry Pension Fund 472 192 536 217 National Social Security Authority Scheme 544 519 405 081 African Sun SA (Proprietary) Limited 14 577 15 774 Provident Fund - Ghana 10 275 - Social Security and National Insurance Trust (“SSNIT”) 26 762 -

25 OTHER INCOME AND EXPENSES

US$ US$

Other incomeFair value adjustment on biological assets (note 10) 33 064 - Dividend income 7 200 Income from insurance claims 30 883 - Income from disposal of scrap 40 379 -

111 526 -

Value of employee services - share options 80 685 20 171 Impairment of inventory items 42 859 - Loss on disposal of property and equipment 267 332 5 595 Fair value adjustment on biological assets (note 10) - 54 027 Impairment of receivables from a related company - WASHL 343 089 419 915



26 EXPENSES BY NATURE

US$Restated

US$

Inventory recognised in cost of sales 5 522 995 6 253 646 Outside laundry in cost of sales 533 505 669 958 Other cost of sales 2 818 187 2 012 609 Employee benefit expenses - payroll cost in cost of sales 7 025 107 6 365 818 - payroll cost in administration expenses 10 493 112 10 834 778 - retrenchment costs - 162 728 - directors' fees 109 392 74 639 Impairment charges on trade receivables 116 936 246 483 Depreciation, usage and amortisation 3 078 094 2 213 420 Sales and marketing 2 462 311 3 718 578 Operating lease costs 8 803 248 8 315 424 Audit fees; - -current year 217 156 46 111 -prior year 128 101 251 454 Repairs and maintenance 2 029 883 2 258 522 Electricity and water 3 048 161 2 963 989 Franchise fees 758 833 710 340 Insurance 601 351 566 012 Licenses 280 744 407 415 Vehicle running expenses 407 679 580 109 Security 1 202 045 1 283 700 Other expenses 3 209 205 4 149 655

Total cost of sales and administrative expenses

Interest income on bank deposits 3 952 5 723

Interest costs on bank borrowings ( 3 464 942) ( 3 918 729)Interest cost on statutory liabilities ( 73 190) ( 208 745)Borrowing costs capitalised - 1 048 964

Net financing costs for the year

For the purposes of statement of cash flows, net interest paid comprise the following; Interest on bank borrowings charged to the statement of comprehensive income ( 3 538 132) ( 3 078 510)Interest on borrowings paid in prior year - - Accrued interest on bank loans prior year paid ( 124 325) ( 167 670)Accrued borrowing costs capitalised prior year ( 213 856) - Accrued interest on bank loans current year - 124 325 Accrued interest on statutory liabilities - 208 745 Borrowing costs capitalised - ( 1 048 964)Accrued borrowing costs capitalised - 213 856

Total interest paid

Interest receivedInterest income on bank deposits 3 952 5 723

There were no borrowing costs capitalised during the year (2013: US$1 048 964)



Basic loss per share is calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year excluding ordinary shares purchased by the Company and held as treasury shares (note 17.2).

Loss for the year: US$

Weighted average number of ordinary shares 830 217 607 823 940 874

Headline earnings / (loss) is a measure of earnings excluding “separately identifiable re-measurements” net of tax (both current and deferred) and related non-controlling interest, other than re-measurements specifically included in headline earnings. The adjustments for 2014 and 2013 are shown below:

Restated

Loss for the yearAdjusted for;Fair value adjustment on assets classified to non-current assets held for sale (note 11, 12) 291 857 3 210 684 Impairment of investment in associate (note 11) 3 050 229 4 417 211 Fair value adjustment on biological assets ( 33 064) 54 027 Recycled from other comprehensive income ( 249 706) ( 181 165)

Headline earnings / (loss) 773 614 ( 1 328 716)

Weighted average number of ordinary shares 830 217 607 823 940 874

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume

conversion of all dilutive potential ordinary shares. At the end of 30 September 2014, there were 32 926 655 potential dilutive share options (2013: 32 926 655) which were granted on the 4th of July 2013. For the share options, a calculation is done to determine the number of shares that could have been acquired at fair value (determined as the average annual market share price of the Company’s shares) based on the monetary value of the subscription rights attached to outstanding share options. The number of shares calculated as above is compared with the number of shares that would have been issued assuming the exercise of the share options.

Weighted average number of ordinary shares in issue 830 217 607 823 940 874 Adjusted for;Share options 24 303 007 24 303 007

Weighted average number of ordinary shares for diluted earnings 854 520 614 848 243 881



US$ US$

Loss before income tax ( 3 104 585) ( 8 805 936)

-depreciation and hotel equipment usage (note 9) 3 078 094 2 213 420 -loss on disposal of property and equipment 267 332 5 595 -amounts recycled from other comprehensive income ( 249 706) ( 181 165)-impairment of investment in associate (note 11) 3 050 229 4 417 211 -impairment of inventory 42 859 - -impairment of other long-term receivables 82 775 - -fair value (gains) / loss on biological assets (note 10) ( 33 064) 54 027 -fair value adjustment on assets classified to non-current assets held for sale (note 11,12)

291 858

3 210 684

-value of employee service 80 685 20 171 -finance costs-net (note 27) 3 534 180 3 072 787 -share of income from equity accounted investments (note 11) ( 274 315) ( 331 034)

Inventories ( 43 688) ( 171 034)-increase in inventories - per statement of financial position ( 829) ( 171 034)-inventory written off during the year ( 42 859) - Current trade and other receivables and trade and other payables ( 241 628) 3 388 095 -decrease / (increase) in current trade and other receivables - per statement of financial position

1 642 073 ( 250 913)

-(decrease) / increase in current trade and other payables - per statement of financial position ( 1 494 363)

2 858 728

-accrued interest prior year 338 181 167 670 -foreign currency translation differences ( 727 519) 612 610 Increase in non-current trade and other payables 445 256 1 758 132 Increase in long-term trade and other receivables ( 189 849) ( 568 381)-increase per statement of financial position ( 85 672) ( 287 709)-adjusted to current ( 21 402) - -allowance for impairment of housing loans and motor vehicle loans ( 82 775) ( 280 672)

In the statement of cash flows, proceeds from sale of property, equipment and motor vehicles comprise:

Cost of property and equipment disposed 839 002 241 224 Accumulated depreciation of property and equipment disposed ( 387 081) ( 124 197)Net book amount 451 921 117 027 Loss on disposal of property and equipment ( 267 332) ( 5 595)Proceeds accounted for under receivables - ( 48 611)

Cash proceeds from disposal of property and equipment

Additions excluding borrowing costs capitalised 3 943 632 6 953 068 Borrowing costs capitalised (note 27) - 1 048 964

Additions to property and equipment (note 9)



The major shareholders of the Group are Lengrah Investments (Private) Limited, Old Mutual Life Assurance Company Zimbabwe

(Private) Limited and Old Mutual Zimbabwe Limited who combined own 54.83% of African Sun Limited shares. The remaining

45.85% of the issued shares are widely held.

Country of

SubsidiariesAfrican Sun Zimbabwe (Private) Limited Zimbabwe 100% 100%African Sun Limited PCC (Mauritius)

Subsidiary companies owned by African Sun Limited PCC are disclosed in note 11.3

Mauritius 100% 100%

Equity accounted investmentsDawn Properties Limited transferred to non-current assets held forsale at year end. Zimbabwe 16.54% 28.54%West African Sun Hotels (Private) Limited Nigeria 50% 50%

Of the 28.54% held in Dawn Properties Limited at 30 September 2013, 12% was sold during the year and the remaining 16.54% has been accounted for under non-current assets held for sale (note 11 and 12)

Joint venturesThe Victoria Falls Hotel Zimbabwe 50% 50%

The following transactions were carried out with related parties:

US$ US$

Rent paid to Dawn Properties Limited

African Sun Limited owns 16.54% (2013: 28.54%) of the shares in Dawn Properties Limited.

Lease rentals relate to the leases of 8 hotels rented from Dawn Properties Limited. All leases with Dawn Properties Limited are

at normal commercial terms and conditions..

Key management includes directors (executive and non-executive), members of the executive committee, the Company

Secretary and Internal Audit Services Manager. The compensation paid or payable to key management for employee services is

as shown

below:

US$ US$

Salaries and other short term employee benefits 1 327 168 1 251 225 Non-executive directors' fees 109 392 74 639 Post employment benefits - 128 355 Share based payments 52 755 12 867

On 4 July 2013, the Company granted 21 528 917 share options to key management in lieu of services. The options vest in 3 years

from date of granting. US$52 755 was charged to the statement of comprehensive income during the year relating to the share

options granted (2013: US$12 867).



COMPANY GROUP

US$ US$ US$ US$Payables to Dawn Properties Limited - - 283 381 397 372 Payable to other Group companies - 1 113 536 - -

- 1 113 536

Receivables from related parties:Receivables from executives - housing loans 255 582 209 089 125 930 209 089 Receivables in lieu of statutory obligations - African Sun Zimbabwe (Private) Limited 1 236 302 - - - Other receivables - African Sun Zimbabwe (Private) Limited 207 025 - - - Receivables from joint venture entity - West African Sun Hotels Limited 19 515 - 785 378 1 024 795

Total receivables The payables to Dawn Properties Limited arose from lease rentals and are due one month after billing. The payables bear no

interest.

The receivables from executives arose from housing loans advanced. Housing loans have a mortorium of 5 years, bear no

interest and are payable over 15 years.

The balance on loans to executives is analysed below:

COMPANY GROUP

US$ US$ US$ US$

As at 1 October 209 089 269 661 209 089 140 054 Housing loans advanced during the year 105 342 137 813 105 342 137 813 Unwinding of interest (188 501) (198 385) (188 501) (68 778)

Receivables from related parties are discounted using the Group’s average cost of borrowing of 13.20% (2013: 13.83%).



31 COMMITMENTS

The Group leases all its hotels in Zimbabwe and one in Ghana under non-cancellable operating lease agreements. The lease terms are between 5 and 15 years, and all the lease agreements are renewable at the end of the lease period at market rates.

The estimated undiscounted future minimum lease payments under the operating leases are as follows:

US$ US$

Not later than 1 year- Fixed 4 056 000 3 300 000

Later than 1 year and not later than 5 years- Fixed 16 224 000 13 200 000

Later than 5 years- Fixed 27 456 000 28 020 000

Total lease commitments

Variable lease commitments are based on estimates described in note 4(e).

US$ US$Authorised by Directors and contracted for - 630 042 Authorised by Directors but not contracted for 4 490 080 4 872 268

Capital expenditure relates to acquisition of property and equipment. The greater part of capital expenditure will be financed

from free cash flows following completion of the greater aspects of our refurbishment.

32 CONTINGENCIES

The Victoria Falls Hotel Partnership, in which the Group has 50% joint control, is a defendant in a legal case involving 69

dismissed employees. The employees were dismissed following their involvement in an illegal industrial action. They have since challenged the dismissal through the courts. The Directors believe, based on legal advice, that the action can be successfully defended. The Group’s share of the estimated accrued benefits to the dismissed employees as at 30 September 2014 is

US$676 218 (2013: US$548 611).

33 EVENTS AFTER REPORTING DATE

Part of the 16.54% investment in Dawn which was classified under non-current assets held for sale as at 30 September 2014 (note 11 and 12) was sold subsequent to year end on 17 December 2014 at a price of US$0.0147 per share and proceeds of US$1 million were received. The rest of the investment is expected to be sold before 30 September 2015.

The Group opened a new hotel under a management contract in the airport area, Lagos, Nigeria on 15 December 2014. The hotel is called African Sun Airport Hotel Lagos.

The Group has exited the Best Western Ikeja management contract following its expiry on 30 September 2014.


5 YEAR REVIEW

CAGR

Restated Restated

SHARE PERFORMANCE: CENTSPer shareBasic earningsBasic earningsBasic (loss) / earnings per share from continuing operations (21) (0.28) (1.07) 0.12 (0.44) (0.13)Basic loss per share from discontinued operations - - - 0.00 (0.81) (0.27)Basic (loss) / earnings per share for the year 9 (0.28) (1.07) 0.12 (1.25) (0.40)

Diluted earningsDiluted (loss) / earnings per share from continuing operations (20) (0.27) (1.04) 0.12 (0.44) (0.13)Diluted loss per share from discontinued operations - - - - (0.81) (0.27)Diluted (loss) / earnings per share for the year 9 (0.27) (1.04) 0.12 (1.25) (0.40)

Headline earningsHeadline earnings / (loss) per share 109 0.09 (0.16) 0.12 0.23 (0.27)Diluted headline earnings / (loss) per share 109 0.09 (0.16) 0.12 0.23 (0.27)

Net asset value (19) 1.27 1.73 2.78 2.61 3.01 Closing market price (7) 2.10 2.10 0.90 1.20 2.79

Share informationIn issue - 831 472 907 831 472 907 831 472 907 831 472 907 831 472 907 Market capitalisation (7) 17 302 758 17 302 758 7 415 468 9 977 675 23 281 241 ZSE industrial index 9 195 200 146 156 137

RATIOS AND RETURNSRevenue generationRevenue: US$ 9 56 716 145 56 275 679 54 426 751 48 796 506 39 942 218 Room occupancy % 2 48 48 50 51 45 RevPAR: US$ 7 47 48 44.59 40 36 ADR: US$ 6 98 100 91 80 79

Profitability and returnsEBITDA: US$ 52 6 948 193 4 095 675 6 288 728 2 733 646 1 295 272 EBITDA margin (%) 42 12 7 12 5 3Pre-tax return on equity (%) - (29) 7 7 (22) (16)Income after taxation to total capital employed (%) - (5) (15) 2 (7) (6)Pre-tax return on total assets (%) - (6) 2 3 (9) (8)

SolvencyGearing (%) - 58 56 40 36 16 Interest cover (times)* - 1.79 1.17 2.49 1.49 (1.50)Shareholders' equity to total assets (%) - 22 25 39 40 50 Total liabilities to total shareholders' funds (%) - 355 306 159 150 101

LiquidityCurrent assets to interest free liabilities and short term borrowings - 0.76 0.63 0.56 0.69 0.90

ProductivityTurnover per employee: US$ 8 36 108 32 669 32 669 27 980 26 691

OtherNumber of employees (7) 1 550 1 666 1 666 1 744 2 030 Number of shareholders (1) 9 041 9 013 9 013 9 107 9 244

* Ratio has been calculated excluding non-cash items and material non-recurring items like impairment of investment in associate.

GROUP SUPPLEMENTARY INFORMATION


Range of holdings Number of

shareholders Issued shares

1-5000 7,366 83.56 5,911,377 0.715001-10000 479 5.43 3,309,036 0.4010001-25000 476 5.41 7,287,304 0.8825001-50000 166 1.88 5,799,137 0.7050001-100001 118 1.34 8,002,208 0.96100001-200000 85 0.96 11,745,872 1.41200001-500000 50 0.57 15,607,680 1.88500001-1000000 25 0.28 19,643,044 2.36Above 1 000 000 50 0.57 754,167,249 90.70

TOTAL



Investments 74 0.84 235,846,383 28.37Insurance companies 16 0.18 215,171,032 25.88Local companies 675 7.67 149,790,470 18.02Fund managers 24 0.27 72,271,404 8.69Local individuals 7,368 83.58 63,899,928 7.69Pension funds 69 0.78 40,776,444 4.90Local nominees 117 1.33 21,182,151 2.55Charities and trusts 163 1.85 19,157,574 2.30Non resident 208 2.36 7,772,930 0.93Foreign nominees 25 0.28 4,931,878 0.59Deceased estates 63 0.71 348,558 0.04Foreign companies 7 0.08 236,090 0.03Banks 4 0.05 85,480 0.01Foreign individuals 1 0.01 2,346 0.00Government / quasi-government 1 0.01 239 0.00

Total

Range of holdings Shareholding Shareholding

Lengrah Investments (Private) Limited 358,666,923 43.14 287,613,748 34.59Old Mutual Life Assurance Company Zimbabwe Limited 202,276,380 24.33 - 0.00Old Mutual Zimbabwe Limited 66,212,575 7.96 184,213,472 22.16Turner Roy 14,323,474 1.72 14,323,474 1.72Altfin Life Assurance Company (Private) Limited 12,536,883 1.51 13,663,366 1.64Stanbic Nominees (Private) Limited 11,124,006 1.34 - 0.00Workers Compensation Insurance Fund (WCIF) 10,586,064 1.27 10,586,064 1.27National Social Security Authority (NSSA) 8,897,753 1.07 8,314,665 1.00Guramatunhu Family Trust 6,822,535 0.82 3,159,598 0.38African Sun Employee Participation Trust 6,698,969 0.81 8,142,735 0.98Zimbabwe Allied Banking Group - - 41,131,913 4.95Equivest Nominees (Private) Limited - - 14,206,617 1.71Chikata Trust - - 11,015,674 1.33Other 133,327,345 16.04 235,101,581 28.27

Total

SHAREHOLDERS’ PROFILEFor the year ended 30 September 2014




Public 8,606 97.63 815,530,035 98.08 Directors 2 0.00 8,167,596 0.98 Non-Public 207 2.35 7,775,276 0.94

Total

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Lengrah Investments (Private) Limited 358,666,923 43.14 287,613,748 34.59Old Mutual Life Assurance Company Zimbabwe Limited 202,276,380 24.33 184,213,472 22.16 Old Mutual Zimbabwe Limited 66,212,575 7.96 66,212,575 7.96

Total

Resident and non-resident shareholders

Resident 818,529,663 98.44 786,499,409 94,59Non resident 12,943,244 1.56 45,023,498 5.41

Total

The residency of a shareholder is based on place of domicile as recorded in the share register as defined for Exchange Control and does not denote status in terms of indigenisation regulations.

Friday 31 December 2013 2.70 UScents Thursday 31 March 2014 2.50 US cents Thursday 30 June 2014 2.95 US cents Friday 30 September 2014 2.10 US cents

Price range

Highest 01 October 2013 to 30 September 2014 2.95 US cents Lowest 01 October 2013 to 30 September 2014 2.00 US cents Average Price 01 October 2013 to 30 September 2014 2.46 US cents

For the year ended 30 September 2014SHAREHOLDERS’ PROFILE


For the year ended 30 September 2014SHAREHOLDERS’ PROFILE

Shareholders’ structure


GROUP STRUCTUREFor the year ended 30 September 2014


BOARD OF DIRECTORS


DIRECTORATE

ChairmanB.L. Nkomo

Non-executive DirectorsE.A. FundiraW.T.KambwanjiA. MakamureG. ManyereN.G. MaphosaT. NdebeleH. NkalaT. NuyN.R. Ramikosi

Executive DirectorsS.A. Munyeza – Group Chief ExecutiveN. Mangwiro – Group Finance Director

BOARD COMMITTEES

Risk and Audit CommitteeA .Makamure (Chairman)S.A.MunyezaN.G.MaphosaN. MangwiroW. T. Kambwanji

Nominations CommitteeB.L. Nkomo (Chairman) W.T.KambwanjiN.R.RamikosiS.A. Munyeza

Human Resources and Remuneration CommitteeW. T. Kambwanji (Chairman)N.R.Ramikosi S.A. MunyezaN.G. Maphosa

Marketing CommitteeN.R. Ramikosi (Chairman) S.A.MunyezaE.A. FundiraH. NkalaT. Ndebele

Finance and Investments CommitteeE.A. Fundira (Chairman) S.A. MunyezaN. MangwiroA. MakamureT. NuyG. ManyereH. Nkala

E. T. Shangwa

AuditorsPricewaterhouseCoopers Chartered Accountants (Zimbabwe)Building Number 4, Arundel Office ParkNorfolk RoadMount PleasantP.O. Box 453HarareZimbabwe

BankersMBCA Bank Limited16th Floor, Old Mutual CentreThird StreetHarareZimbabwe

FBC Bank Limited5th floor, FBC CentreNelson Mandela AvenueHarare

Legal AdvisorsDube, Manikai & Hwacha Legal Practitioners6th Floor, Gold BridgeEastgate ComplexRobert Mugabe RoadHarareZimbabwe

REGISTERED OFFICEAfrican Sun HouseNo. 6 Seagrave Road Mount PleasantHarareZimbabwe

CORPORATE INFORMATION


EXECUTIVE COMMITTEES.A. Munyeza - Group Chief ExecutiveN. Mangwiro - Group Finance DirectorJ. Mwanza - Group Operations DirectorE. Nyakurerwa - Group Human Resources DirectorE.T. Shangwa - Group Company Secretary

SENIOR EXECUTIVESC.Chishakwe - Group Internal Audit Services ManagerB. Dirorimwe - Corporate Finance ManagerT. Hwingwiri - Group Operations ManagerL. Moyo - Group Executive ChefM.Moyo - Group Sales ManagerF.F. Muswere - Group Technical Manager

HOTEL AND RESORT GENERAL MANAGEMENT

GhanaA. Matema - African Sun Amber Hotel Accra Airport

NigeriaD. Kanyandu - Nike Lake Resort, EnuguW. Kazhilla - African Sun Amber Residence GRA

Ikeja, LagosS. Sibanda* - African Sun Airport Hotel Lagos, Lagos

ZimbabweG. Togni - The Victoria Falls Hotel PartnershipT. Mutyandasvika - Elephant Hills Resort and

Conference CentreD. Kung - The Kingdom at Victoria FallsV. Halimana - Troutbeck ResortA. Chikwanda - Caribbea Bay Resort M. Zulu - Great Zimbabwe Hotel M. Matebwe* - Hwange Safari Lodge C. Chinwada - Holiday Inn HarareI. Katsidzira - Crowne Plaza MonomotapaC. Mulinde - Holiday Inn BulawayoS. Dube - African Sun Amber Hotel MutareC. Chimbira - Beitbridge Express Hotel

Sun CasinosJ. Wenyimo - Bulawayo Sun CasinoB. Chiutare - Harare Sun CasinoJ. Kaseke - Makasa Sun CasinoM. Chikosi - Manica Sun Casino

Sun VacationsT. Hwingwiri* - Blue Swallow Units and Kingfisher Cabanas

*Acting Managers

MANAGEMENT


NOTICE IS HEREBY GIVEN THAT, the Forty Third Annual General Meeting of Shareholders of African Sun Limited will be held in the Kariba Room at Holiday Inn Harare, Corner 5th Street and Samora Machel Avenue, Harare on Tuesday, 31 March 2015 at 1100 hours for the following purposes:

ORDINARY BUSINESS

To receive and adopt the financial statements for the year ended 30 September 2014, together with the report of the Directors and Auditors therein.

Mr S Cranswick resigned on the 17th of November 2014. Ms T Ndebele and Messrs H Nkala and G Manyere were appointed to the board on 24 November 2014. They retire at the end of their interim appointments. All being eligible, they will offer themselves for re-election at the Annual General Meeting.

Mr E Fundira and Ms N Maphosa retire by rotation. Both being eligible, they will offer themselves for re-election at the Annual General Meeting.

To determine the Auditor’s remuneration for the past audit. PricewaterhouseCoopers have indicated their willingness to continue in office.

To approve the payment of Directors’ fees for the chairman and non-executive directors for the year ended 30 September 2014.

SPECIAL BUSINESS

To consider, and if deemed fit, pass with or without amendment, the following resolutions as special resolutions:

“Notwithstanding anything to the contrary in the Companies Act (Chapter 24:03) and in these Articles of Association the Company shall issue securities in dematerialized form, convert certificated securities to dematerialized securities, and allow its securities to be traded in dematerialized securities, provided that no certificated securities shall be converted to their dematerialized form without the consent of the holder thereof”.

Any Notice required to be sent to members in terms of sections 141 to 143 above and 144 below may, notwithstanding anything to the contrary in the aforementioned sections be sent by electronic means to the electronic address last furnished by such members. Likewise, any documents that may be required to be sent to members in terms of these Articles or the Companies Act (Chapter 24:03) may be sent to the electronic address of the members and shall be posted on the Company’s official website”.

“Any dividend, interest or other monies payable in respect of the shares may be paid through any and all approved national payment systems and such payment may be notified to the recipient by communication to his electronic address or in the case of joint holders, to the electronic address of that one of the joint holders who is first named on the register of members or to such person or to such electronic address as the holder or joint holders may in writing direct. Any one of two or more joint holders may give effectual receipts for any dividends, bonuses or other money payable in respect of the shares held by them as joint holders”.

To consider, and if deemed fit, pass with or without amendment the following resolution as an ordinary resolution, “That the Company be and is hereby authorized to make a loan to any Executive Director or to enter into any guarantee or provide any security in connection with a loan to such Executive Director for the purposes of enabling him to properly perform his duty as an officer of the Company as may be determined by the Board of Directors, provided that the amount of the loan or the extent of the guarantee or security shall not be more than two times the annual remuneration of that Director”.

NOTICE TO MEMBERS


EXPLANATORY NOTES TO THE PROPOSED RESOLUTIONS

Dematerialization of securities The legislature, by way of the Companies Act (Chapter 24:03) only recognized share certificates in their physical (paper share certificates) as

opposed to their electronic form. These paper share certificates unfortunately had certain disadvantages in that, among other things, they could be lost or destroyed and were vulnerable to manipulation to the detriment of the shareholder. Cognisant of the inherent disadvantages of paper share certificates the legislature has crafted appropriate legislation in the form of the Securities and Exchange Act (24:25), section 72 of which allows securities to be dematerialized (converted to electronic form from physical form). It is now a requirement that all listed certificated securities be converted into electronic form before they are traded on the Zimbabwe Stock Exchange (ZSE). Because of these developments, there is now an imperative need to align the Company’s Articles with these progressive developments

Electronic shareholder documents and notice The introduction of these electronic shareholder documents and notices has been borne out of a realization of the developments and advances

that have been made in recent years with regards to the forms of electronic communication. The efficiencies that have been ushered in by these advances together with the ever increasing expenses associated with the preparation and delivery of physical copies of annual reports, shareholder notices and related documents in a challenging operating environment have necessitated such proactive measures.

Note:(a) In terms of section 129 of the Companies Act (Chapter 24:03), members are entitled to appoint one or more proxies to act in the alternative, to

attend, vote and speak in their place at the meeting. A proxy need to be a member of the Company. (b) In terms of Article 80 of the Company’s Articles of Association, instruments of the proxy must be lodged at the registered office of the Company at

least forty-eight hours before the time appointed for holding the meeting.

By Order of the Board

Registered OfficeAfrican Sun LimitedAfrican Sun House 6 Seagrave Road Mount Pleasant Harare Zimbabwe

NOTICE TO MEMBERS


SHAREHOLDERS’ DIARY

Full Year Results 2014 January 2015Annual Report 2014 Published March 2015Forty-third Annual General Meeting 31 March 2015

INTERIM REPORTS ANTICIPATED DATEHalf Year Results 2015 June 2015Full year Results 2015 November / December 2015

Forty-fourth Annual General Meeting March 2016

SHAREHOLDERS’ DIARY


African Sun Limited Incorporated in the Republic of Zimbabwe Registration number: 643/1971

Registered office Transfer Secretaries African Sun House Corpserve (Private) LimitedNo. 6 Seagrave Road 2nd FloorMount Pleasant ZB Bank CentreHarare cnr Kwame Nkrumah Avenue/First StreetP.O. Box CY 1211 P.O. Box 2208Causeway HarareHarare ZimbabweZimbabwe Tel: +263 4 751559/61Tel: +263 4 302892, 302894, 302906, 304114, 304050, Email: [email protected], 304256, 403073, 304006, 304038 Email: [email protected]: www.africansunhotels.com

Investor relationsWeb: www.africansunhotels.com

For reservations:Pan African Central Reservations Office, Johannesburg (PACRO) +27 100030079,100030081-5Email: [email protected]

Harare Central Reservations Office Harare (HACRO) +263 4 700521 or +263 782 706 785-7Email: [email protected]

West Africa Central Reservations Office (WACRO) +234 8058205186Email: [email protected]

GhanaAfrican Sun Amber Hotel Accra Airport +233 545 987 438 or 574 286 422 or 302 742 730-59

NigeriaAfrican Sun Airport Hotel Lagos +234 815 800 3333/ +234 815 700 3333/ +234 818 888 8765/ +234 818 888 8793African Sun Amber Residence GRA Ikeja, Lagos +234 18 447 832 or 831Nike Lake Resort +234 805 055 7000 or 803 762 2200 or 802 536 6655

ZimbabweAfrican Sun Amber Hotel Mutare +263 20 64431Beitbridge Express Hotel +263 86 23001-4 or 23371-2Caribbea Bay Resort +263 61 2452-4Crowne Plaza Monomotapa +263 4 704501-30Elephant Hills Resort and Conference Centre +263 13 44793-9Great Zimbabwe Hotel +263 39 262274, 265427 or 264187Holiday Inn Bulawayo +263 9 252464, 257211 or 252460-9Holiday Inn Harare +263 4 251200-14 or 795610-38Hwange Safari Lodge +263 18 331-6The Kingdom at Victoria Falls +263 13 44275 or 13 42358The Victoria Falls Hotel +263 13 44751-60 or 44203-5Troutbeck Resort +263 298 881 or 298 883-6

CORPORATE AND HOTEL DIRECTORY


NOTES

THE COMPANY SECRETARY

African Sun HouseNo. 6 Seagrave RoadMount PleasantHarareP.O. Box CY 1211, Causeway,Harare, ZimbabweTel: +263 4 250501-7 or +263 4 700522-4Email: [email protected]

CORPORATE HEAD OFFICE

African Sun HouseNo. 6 Seagrave RoadMount PleasantHarareP.O. Box CY 1211, Causeway,Harare, ZimbabweTel: +263 4 250501-7 or +263 4 700522-4Email: [email protected]: www.africansunhotels.com

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