africa debt, unitranche and mezzanine impact financing - 2012 · 2017-04-12 · the growth strategy...

ANNUAL REPORT2012

Norsad Finance 2012 Annual Report 2

Norsad Finance Limited is a Southern African development finance institution with strong Nordic roots. We provide long-term investment loans and risk capital to financially, socially and environmentally sustainable projects and companies. In addition, Norsad Finance Limited seeks opportunities to increase private sector financing by providing equity and credit facilities to financial institutions, including commercial banks.

Investing in Sustainable Enterprise Growth

3

Contents

About Norsad 4

Chairman’s Message 6

CEO’s Message 8

Norsad Investment Operations 13

Corporate Governance 18

Norsad Team 19

Financial Statements

Director’s Responsibility Statement 22

Independent auditors Report 23

Statement of Comprehensive Income 24

Statement of Financial Position 25

Statement of Cash flows 26

Notes to the Financial Statements 27

MissionNorsad Finance provides long term risk capital to Southern African companies that are financially,

socially and environmentally sustainable.

VisionNorsad Finance will be recognized as a provider of flexible and customised financing solutions to

commercially viable, as well as socially and environmentally sustainable businesses in Southern Africa

by:

1. Providing customised debt and equity financing for growth companies and financial institutions.

2. Tripling its capital base by 2017 through a capital increase from its Shareholders, retained earnings

and leveraging from market.

3. Maximizing its economic and development impact by actively catalysing co-financing from its

Shareholders, venture capital funds, commercial banks and development finance institutions (DFIs).

4. Adding value to its Shareholders by being an accountable and complementary tool for achieving

their private sector development goals.

About Norsad


Our profileNorsad Finance Limited is a Development Finance Institution established to contribute to the private

sector development of Southern African countries, by way of availing funding to enterprises that are

financially, socially and environmentally sustainable and which will create jobs with decent working

conditions, adopt good governance and overall assist economic growth and poverty alleviation in

Southern African Countries. The company was incorporated in Botswana in 2011 and is Botswana

IFSC accredited.

Though the Company was only incorporated in November 2011, NORSAD has a history spanning

over 20 years. NORSAD Fund first started operating in 1990 as a multilateral entity and Agency

which had been managed from Lusaka, Zambia. Back then, the purpose of the organisation was to

contribute to the economic development and self-reliance of the participating SADC countries by

extending foreign currency facilities to the private sector.

Social and Environmental ResponsibilityNorsad Finance’s key aim is to promote sustainable and environmentally friendly businesses which create

decent jobs in Southern Africa. This has been and continues to be an integral part of our vision. Since our

inception days operating as a multilateral entity, we have been sensitive to the social and environmental

impact of our investee companies. In order to keep up with international trends and developments, we

have adopted IFC’s environmental and social performance standards. Projects financed by Norsad are

required to comply with these standards as well as local legislation. By and large our portfolio companies

have performed well against these standards.

Our investment professionals work with investee companies to assist them with formulating

and implementing social and environmental policies.

Key highlights 2012• Norsad records a profit after tax of USD 1.57 million for the first year of operation as Norsad

Finance Limited.

• The Board of Directors approved USD 28.8 million of new investments.

• The total committed capital of the company reaches USD 110 million.

• Outstanding Investment Portfolio grows by 8% to USD 46.4 million.

• The institution receives Botswana IFSC accreditation.

About Norsad


I am pleased to note that both the Norsad Finance team and the Board of Directors have been very active and diligent and the results are beginning to really show, particularly now as we move into 2013.

The bold decision we made in 2011 by the 15 NORSAD Fund and Agency member governments to transform the multilateral entity, with its 20 years of operations, into a limited liability company laid the foundation for the establishment of Norsad Finance Limited. In May 2011, the representatives of the national development finance institutions and other entities from former NORSAD member countries, designated as the prospective shareholders of Norsad Finance Limited, began discussions on the founding documents of the Company.

The Company Constitution and Shareholders Agreement were finalized and signed by 13 shareholders on 15th of December 2011. At the same time, the first Shareholders Meeting was held to appoint the Board of Directors. Subsequently, another shareholder joined Norsad Finance bringing the present number of shareholders to 14. We expect one more shareholder to join before the end of August 2013.

At the time of transformation, the assets and liabilities from NORSAD Fund and Agency were transferred to Norsad Finance Limited. The assets, mainly consisting of NORSAD’s investment portfolio, with a net worth of USD 73 million, formed the initial capital of the Company as at 1st of January 2012. At the time of establishing Norsad Finance Limited, the shareholders also agreed on the terms and conditions of a Preference Share issue open to all shareholders.

In 2012, four Nordic shareholders subscribed to 4,084 Preference Shares bringing the total committed capital of the Company to roughly USD 110 million. We have indications from several Southern African shareholders regarding their interest to join the Preference Share issue before it closes on 28th of February 2014. This will greatly support the growth strategy of the company.

A number of policies and guidelines have been developed and approved to ensure good governance. The Board of Directors has set operational targets and approved strategic measures and goals to grow

Chairman’s Message

The first year of Norsad’s operations as Norsad Finance Limited has been active in many ways. The foundations for good governance have been laid and strategies to guide operations in future have been developed.

the Company threefold over a period of five years. In June 2012, the Investment Policy was amended to reflect the approved strategy. Norsad Finance relocated its offices and professional staff to Gaborone from Lusaka at the end of 2012.

Despite the initial concentration on governance issues and subsequently on the relocation, the investment team still managed to complete a great deal of groundwork during 2012 to ensure the future growth of the Company and its investment portfolio. Altogether 8 investments valued at USD 28.8 million were approved by the Board. The investment portfolio grew by 8% to USD 46.4 million and the Company achieved a net profit of USD 1.57 million after tax in its first year of operation.

The excellent performance during the first quarter of 2013 indicates that the Company is ready to fully implement the growth strategy set by the Board. I would like to take this opportunity to thank my fellow Directors for all their efforts in guiding Norsad Finance to its growth path. I would also like to thank the management team for their assiduous and fundamental efforts during the transformation process and first year of operations. My sincere thanks also go to the whole Norsad Finance team for their loyalty and diligence during this challenging era of transformation and for their continued excellent efforts in bringing good investments into the Company portfolio.

Pekka Juusela

(Chairman), Finland

Chairman’s Message


The decision to expand our product offering to include mezzanine and equity instruments has opened up new prospects for us. Our ability to implement our growth strategy to exploit these prospects has been vastly improved by the injection of additional funds from the Shareholders as well as the recent strengthening of the investment team.

The first year of our operations as Norsad Finance was for the most part characterised by formalising our governance guidelines and policies as well as the relocation of the office from Lusaka, Zambia to Gaborone, Botswana. The office relocation required extensive efforts from both the management and investment teams. With this behind us, we shall now concentrate our efforts to provide flexible and customised debt and equity financing to growth companies and financial institutions in the Southern African region.

Norsad on the Growth PathThe Board of Directors approved a 5 year vision for 2017 and amended the investment policy to support the growth strategy set for the Company. The main objective of the strategy is to triple our capital base and investment portfolio by 2017 through a capital increase from the Shareholders and leveraging from the market. The ability to offer a mezzanine and equity investment has given us the necessary boost in looking for prospective investment opportunities.

In addition to the professional staff relocated from Lusaka to Gaborone, we have recruited four new members to the investment team therefore increasing the investment team to eight professionals. I am confident that with this motivated and skilled investment team and the flexibility to make further recruitments, we shall achieve the strategic targets in coming years.

A capital replenishment through a preference share issue was agreed by the Shareholders at the time of establishing Norsad Finance in 2011. The four Nordic Shareholders have subscribed to 4,084 Preference Shares and committed to invest an additional USD 33.81 million in the Company. Thus far, USD 24.51 million of the additional capital has already been paid in therefore increasing the stated capital of the Company to USD 97.59 million. The Preference Share issue remains open to all Shareholders until 28 February 2014. A number of Shareholders have expressed further interest to participate in a Preference

CEO’s Message

The economic growth in the Southern African region is evidenced by the private sector’s growing demand for financing. Norsad Finance has felt this growth through the demand for financing from its portfolio companies and prospective new clients.


Share issue which offers higher return to the participating Shareholders than the Ordinary Shares. The increase in the capital base has opened up an opportunity for us to increase our aggregate exposure limit per single customer to USD 10 million.

Investment Operations 2012Although the office re-location required a fair share of the attention, the Norsad Finance limited Investment team actively continued sourcing potential investments. Although lower than anticipated in the original Norsad Finance Limited business plan, altogether 8 investments valued at USD 28.8 million were approved by the Board since its first Board Meeting held in December 2011. The outstanding Investment Portfolio grew by 8% and to USD 46.4 million during the first year of operations.

The country and sector analysis of USD 28.8 million approved for investments in 2012

Norsad’s investment portfolio demonstrates a strong positive development impact. Contribution of our investments to the government revenues and national incomes in the region increased in comparison with 2011. As at year end, our investee companies employed directly over 4,400 people and over 2,200

CEO’s Message

13.00Zimbabwe

6.00Mozambique

4.80Mozambique

4.00Zambia

1.00Malawi

20.80Financial Institutions

3.00

Agriculture

3.00Aquaculture

1.00Hospitality

1.00Mining

Financial institutions

Agriculture

Aquaculture

Hospitality

Mining

Zimbabwe

Mozambique

Namibia

Zambia

Malawi


employees had participated in various training activities to upgrade their skills. Indirectly over 21,400 people earn their living through end-beneficiaries of our credit facilities to the financial institutions.

The responsibilities of the management team were rearranged due to the departure of our long serving Chief Investment Officer, Mr Patience Matshe. The investment operations now fall under the direct supervision of the CEO. A new position of Risk and Portfolio Manager was created to cater for the company’s high emphasis on social and environmental sustainability and increasing positive development impact in its investments. Mrs Rosemary Liywalii was appointed to this position and she is responsible for the social, environmental, compliance issues and development impact assessments of our investee companies.

Investment PortfolioNorsad Finance Limited inherited the loan portfolio of the Norsad Fund as at 1 January 2012. We were therefore able to hit the ground running. The majority of the investments approved during the first year had already been prepared by the Norsad Agency. The net outstanding investment portfolio as at 31 December 2012 was USD 46.4 million. The annual growth of the net outstanding portfolio was 8 %. The net outstanding portfolio and commitments as at 31 of December 2012 was USD 67.6 million representing a 13.2% annual growth.

The country analysis of the net outstanding portfolio and commitments as at 31st of December 2012

Positive Result from the First Year of OperationsThe Company’s net profit of USD 1.57 million after tax in its first year of operations demonstrates that development finance operations can be feasible also under limited liability company structure.

CEO’s Message

18.00

16.0014.00

12.00

10.00

8.00

6.00

4.00

2.00

Angola

Mozam

bique

Malawi

Namibi

a

Swaz

iland

Tanzan

ia

Zambia

Zimba

bwe

USD Million

Norsad Finance contributed USD 435,000 to the various governments’ revenue in form of withholding taxes. Though the pro-rated return on equity of 1.9% is still modest, the long term strategy anticipates higher overall returns on equity and commercially viable returns for the Preference Share subscribers.The strategic shift to higher return mezzanine and equity investments shall also have a positive impact on the overall return on assets and equity. The demand for these instruments in the Southern African region is high. Therefore, we are confident that our shareholders’ return expectations are achievable.

In conclusion, I wish to extend my sincere appreciation to the rest of the management and investment team for the unwavering commitment they demonstrated by achieving good results during a challenging year of transformation and office re-location. I would also like to take this opportunity to give a special thanks to those Norsad team members who were not able to follow us to Gaborone and wish them the best in their future careers.

Sari Nikka CEO

CEO’s Message

Norsad Finance Limited

Investment Operations


Norsad Investment Operations

Norsad Finance Limited provides funding to financially, socially and environmentally sustainable companies in Southern Africa. We provide long term investment loans, mezzanine and equity instruments. In addition, we provide financing for local and regional financial institutions to facilitate the sustainable commercial financing for Southern African companies. Below are examples of Norsad Finance Limited’s investee companies.

Banco Regional do Keve SA, Commercial Bank, Angola

Banco Keve SA was founded in October 2003. The bank’s capital and reserves, are in excess of USD 95 million and it aims to become a leader in the commercial banking space in Angola.

Banco Keve finances Small & Medium Enterprises on commercial terms and offers a wide range of financial products and services. The bank employs 333 people and its SME portfolio financed by Norsad has resulted in creation of an additional 555 jobs. In terms of market share, the bank is ranked 12th out of 23 banks and its total assets as at December 2012 stood at USD 896 million.

In terms of the Norsad Social, Environmental and Governance grading, Banco Keve has been classified as a medium risk financial institution. This grading takes into consideration the environmental and social impact of the projects funded by the financial institution. Very few of the projects financed by the bank could have a negative impact on the environment.

TIB Development Bank, Development Finance Institution, Tanzania The bank was established in 1970 as a development finance institution and was later transformed into an investment cum development bank in order to enhance its capacity to meet the increasing demand for capital. The Government of Tanzania has put TIB in a restructuring program to modernize and recapitalize the bank in order to give it more capability of financing development programs of the country. The bank mostly focuses on providing long and medium term loans together with working capital. TIB’s new mandate focuses on financing Industrialization, infrastructure, and service sectors.



BancABC, Commercial Bank, Zambia and Zimbabwe Norsad has been a long term partner for BancABC, being among the first providers of external credit facilities to its operations in Zambia since the 90s. Over the years, Norsad´s financing to the bank has increased in line with the bank’s growth.

At present, Norsad has provided funding to Banc ABC for its operations in Zambia and Zimbabwe. BancABC offers a diverse range of financial services which include personal, business and corporate banking as well as asset management, stockbroking and treasury services. The growth of the bank’s retail banking operations coupled with the momentous growth in the institutions loan book has resulted in the good performance recorded in the year 2012. Through the expansion of its retail network both in Zambia and Zimbabwe, BancABC has created many sustainable jobs.

Alios Finance Limited, Leasing, Zambia

Alios Finance Zambia is a subsidiary of Alios Finance Group which is thus far the largest independent asset finance company in the Sub Saharan Africa outside South Africa. Alios Finance Zambia was established in February 2006 under the name of Mercantile Leasing Limited by local Zambian businessmen, and it offers finance leases to well established SMEs.

Alios Finance took a majority stake in the company in 2008 and rebranded it to Alios Finance Zambia.

The company has experienced tremendous growth in demand for its products in recent years and in

order to meet this continuing demand and bring business closer to clients, they are increasing the number

of branches in strategic locations across Zambia. To this end, Alios recently opened a branch in Kitwe, on

the Copperbelt Province.



D. D. Ruhinda & Company Limited, Sisal Production Tanzania

This family owned business has grown from strength to strength. It was set up in 1991 as a trading company involved in the buying and selling of locally produced fibre products. In 1997, they ventured into sisal production after acquiring the 1,734ha Mkumbara Sisal Estate. Presently they have 1,200 hectares in production and intend to improve yield from 1.5tons per hectare to 2.0 tons per hectare.

The company is also establishing a spinning mill which will add value to the raw sisal fibre by producing more than 1,000 tons of sisal yarn per annum. The project has impacted positively on the local community, through employment creation in an area of the country with limited employment oppor tunities. They employ 350 people.

The company aspires to be one of the best sisal companies in the world with excellence in production, productivity, quality of products and corporate social responsibility. Environmental risks identified during the Norsad funded environment and social due diligence are being addressed by the company.

Kariba Harvest Limited, Aquaculture, Zambia

Kariba Harvest is constructing a Tilapia

fish farm in Siavonga district in Zambia.

Once operational in 2013, Kariba Harvest

will go a long way in contributing to the

food security of Zambia. Kariba Harvest

is expected to reach production levels of

12,000 tons of fish annually. At the moment

Zambia faces a deficit in fish production and the

country is importing fish from Asia and Latin

America to reduce the supply gap. Zambia has

excellent conditions for the development of a

domestic aquaculture sector which will substitute

imports and improve the foreign exchange

balance of the country.



Environmental risks associated with this project have limited adverse impact. Kariba Harvest will provide an affordable protein source to a large population and contribute to the economy through the provision of direct and indirect jobs and improved service delivery. Once fully in operation, Kariba Harvest will create over 300 permanent jobs to the local community of high unemployment and only few employment providers.

Malawi Sun Hotel and Conference Centre, Malawi

The 2007 established Malawi Sun Hotel and Conference centre offers three star accommodation and conferencing facilities in Blantyre. Owing to the increasing demand for hotel accommodation in Blantyre, the company is implementing an expansion project which will increase the total number of rooms by an additional 23 to 65 by November 2013. The business employs 150 permanent employees and occasionally engages casual contractors depending on business levels. In terms of the environmental and social environmental grading, Malawi Sun has been awarded a B grade, meaning limited adverse social and environmental impact.

Frango King Limitada, Poultry, Mozambique

Frango King Limitada was established in 2000 under the name GETT Limitada. The company is involved in production and sales of day old chicks, broiler chickens and frozen chicken. They also produce chicken feed for use at their own farms as well as to sell to other poultry farmers. At present the company has 3 sales outlets and is intending to add more sales outlets and agencies across the Nampula region. Frango King Limitada contributes immensely to the food security in Mozambique.



Being one of the largest poultry producers, Frango king stands to benefit from the strong economic growth which has resulted from the growth in the country’s resource sector. Employment levels stand at 361. Management intends to implement ISO 9001/14001/18001 quality management systems to address gaps which they have identified in the company’s management of social and environmental issues.

Natural Valley Limited, Water Purification and Bottling, Zambia

Natural Valley is water purification and bottling company which responded to the huge demand for safe portable water in Zambia. It trades under the brand of Manzi Valley and it has grown into one of the largest water bottling companies in Lusaka. They operate from 50 acres of undisturbed natural habitat. Manzi Valley distributes about 13 million litres of bottled water a year and they intend to increase this to 22 million litres by 2015.

In recent times, the company has reached out to the local communities where they operate through the Manzi health program aired weekly on the local radio station and support for local sporting activities. The management of Manzi Valley are mindful of the environmental impact of their business venture and they are continually in search of ways to minimise such impact.

Oil and Protein Company, Oil Extraction, Malawi

The company extracts vegetable oil from soya bean and sunflower seed. It was formed in 1984 by the Malawi Government and privatised in 2010. In recognition of the growing market for edible oils in Malawi, the company has embarked on an expansion drive starting with the installation of a state of the art solvent extraction plant to improve efficiencies.

Once commissioned, the plant will significantly increase OPC’s production capacity thereby enabling the company to capitalise on the edible oil supply gap in Malawi. Historic statistics show that Malawi’s annual consumption of edible oil is 55,000 MT, while its local production is estimated at 40,000 MT. Products of oil and protein company are reducing Malawi’s importation of edible oils, thus saving the country much needed foreign exchange. The company has social and environmental category A, meaning potential significant adverse impact. Norsad investment professionals are working closely with the promoter to put in place necessary procedures to mitigate the social and environmental risk.



Norsad recognises that good corporate governance is key to the integrity of the organisation and

its ability to manage risk and perform at its best. Therefore our board of Directors which comprises

of top executives, from our shareholder development finance institutions, is committed to ensuring

that Norsad maintains the highest levels of ethical and accountable business conduct.

The main Board together with its sub-committees act in the best interests of the institution and

always take cognisance of the objectives of accountability, responsibility and transparency, which are

the cornerstones of good corporate governance principles.

During the first year of operating as a limited liability company, a number of policies were developed and

approved by the Norsad Finance Limited board to ensure that good governance is maintained.

Our Board Members

Member Alternate DirectorsCarlsson Oscar, Sweden Armtoft Jonas, SwedenChikaura Charles, Zimbabwe Noni Peter, Tanzania

Juusela Pekka ( Chairman), Finland Kangasniemi Jaakko, FinlandLushinga Jacob, Zambia Malene Aurora, MozambiqueSandnes Ludvik, Norway Lindoe Per-Emil, NorwaySorensen Jens, Denmark Nyegaard Hans-Jorgen, DenmarkThamane Thabo, Botswana Klein Catherina, Namibia

Corporate Governance


Chief Executive Officer, Sari Nikka

Mrs Sari Nikka joined NORSAD Agency in 2007. Before joining Norsad

she served as Programme Director and Senior Investment Manager at

Finnfund, and as Project Finance Advisor at Finnvera, the Finnish Export

Credit Agency. She has over 15 years of experience in international

project finance and funds in developing and non-OECD countries. Mrs

Nikka has served as a Member of the Board of Directors and Investment

Committee in several SME and Microfinance Funds. Mrs Nikka has Master

of Science in Economics and Business Administration.

Financial Manager, Jonathan Davies

Mr Jonathan Davies has worked as Financial Manager for NORSAD

Agency and Norsad Finance since 1999. He has almost 20 years of post

qualification experience, virtually all of which has been at management

and supervisory level. Mr Davies has been living in Africa for 17 years.

He has Bachelor of Arts (Honours) Degree in Accounting & Finance.

He is a member of the Association of Chartered Certified Accountants

(ACCA) and is an FCCA.

Risk and Portfolio Manager, Rosemary Kusensela Liywalii

Mrs Rosemary Liywalii joined NORSAD Agency in October 2003. She

was appointed to the Risk and Portfolio Manager position in January 2013.

Prior to joining NORSAD Mrs Liywalii worked for Finance Bank Zambia

Limited and for Barclays Bank Zambia Limited in various capacities. She

has almost 20 years experience in banking. Mrs Liywalii has an MBA from

Heriots-Watt University’s Edinburgh Business School, and a Bachelor of

Science Degree from University of Manchester Institute of Science and

Technology. She is also an Associate Member of the UK, Chartered Institute

of Bankers.

Norsad team

Management


Investment Team: Sari Nikka Chief Executive OfficerRosemary LiywaliiRisk and Portfolio ManagerAlice Zulu Senior Investment OfficerEdward MuliloSenior Investment Officer Dudu Garekwe Senior Investment OfficerJustin Nthala Senior Investment OfficerTshepiso Makgoeng Senior Investment OfficerNaomi Mulima Porfolio officerOarabile Basiame Financial AnalystRefilwe Sebego Financial Analyst

Admin and Support Team: Jonathan DaviesFinancial ManagerKelsey Talane Personal AssistantKagiso Chipo Kukuni ReceptionistMercy MatomeCleanerNot on picture:Thabo TokoDriver

L to R Mercy Matome, Kesley Talane, Kagiso Chipo Kukuni, Jonathan Davies

Norsad team

L to R(Front row) Alice Zulu, Edward Mulilo, Refilwe Sebego, L to R(Middle row) Oarabile Basiame, Sari Nikka, Naomi Mulima, L to R(top row) Rosemary Liywalii, Tshepiso Makgoeng, Dudu Garekwe, Justin Nthala,

Norsad Finance Limited

Annual Financial Statements for the period ended 31 December 2012

The financial information presented on pages 21-42 is extracted directly from annual financial statements which are available for inspection at the Norsad Finance offices situated at Plot 74770, Western Commercial Road, Central Business District, Gaborone, Botswana. The auditor’s report was published on 21 March 2013 and has been extracted directly from the annual financial statements of the company.


Directors’ responsibility statementfor the period ended 31 December 2012

The directors are responsible for the preparation and fair presentation of the annual financial statements of Norsad Finance Limited, comprising the statement of financial position at 31 December 2012, and the statements of comprehensive income, changes in equity and cash flows for the period then ended, and the notes to the financial statements, which include a summary of significant accounting policies and other explanatory notes, and the directors’ report, in accordance with International Financial Reporting Standards.

The directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error and for maintaining adequate accounting records and an effective system of risk management.

The directors’ have made an assessment of the ability of the company to continue as going concern and have no reason to believe that the business will not be a going concern in the year ahead.

The auditor is responsible for reporting on whether the annual financial statements are fairly presented in accordance with the applicable financial reporting framework.

Approval of annual financial statementsThe annual financial statements of Norsad Finance Limited, as identified in the first paragraph, were approved by the board of directors on 21 March 2013 and signed on their behalf by:

___________________ ___________________ Pekka Juusela Thabo Thamane Director Director

Norsad Finance LtdFinancial Year 2012


Independent Auditor’s ReportTo the shareholders of NORSAD Finance Limited

We have audited the accompanying financial statements of NORSAD Finance Limited, which comprise the statement of financial position as at 31 December 2012 and statements of comprehensive income, changes in equity and cash flows for the period then ended, and a summary of significant accounting policies and other explanatory notes.

Directors’ Responsibility for the Financial StatementsThe directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and for such internal control as the directors determine 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 concluded 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 risk 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 polices 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.

Audit opinionIn our opinion, the financial statement give a true and fair view of the financial position of NORSAD Finance Limited at 31 December 2012, and its financial performance and its cash flows for the period then ended in accordance with the International Financial Reporting Standards.

KPMG GaboroneCertified Auditors Date:21/3/2013Practicing Member: AG Devlin(19960060:23)

Independent Auditor’s Report


Statement of comprehensive incomefor the period ended 31 December 2012

In US Dollar Note 2012

Interest from loans and advances 5 3 786 225Interest from liquid investments 16 778 Interest income 3 803 003 Fee and commissions income 248 104Other operating income 6 1 273 775 Total Operating income 5 324 882 Operating expenses 7 (2 361 923) Profit before loan impairment losses 2 962 959Allowance for loan impairment losses 11 (623 007) Profit before income tax 2 339 952Taxation 8 (434 581) Profit for the period 1 905 371 Unrealised net loss on loans and advances (164 562)Unrealised net loss on equity investments 10 (166 117)Total Unrealised losses (330 679)

Total comprehensive income for the period 1 574 692



Statement of financial positionat 31 December 2012

In US Dollar Note 2012Assets Cash and bank balances 9 52 448 146Financial assets designated at fair value 10 276 863Loans and advances 11 46 366 968Other assets 12 120 447Plant and equipment 13 105 252 Total assets 99 317 676 Liabilities and equity Accruals and other liabilities 14 157 175 Total liabilities 157 175 Equity Stated capital 15 97 585 809Reserves 1 574 692Total equity attributable to equity holders of the Company 99 160 501 Total liabilities and equity 99 317 676

___________________ ___________________ _________________Pekka Juusela Thabo Thamane Sari NikkaDirector Director Chief Executive Officer



Statement of cash flowsfor the period ended 31 December 2012

In US Dollar Note 2012Operating activities: Profit before taxation 2 339 952Adjusted for: Depreciation 13 26 404Loan impairment writeback 11 (1 235 529)Loan impairment charge 11 623 007Movement in other assets 72 217Movement in sundry liabilities (869 049) Cash flows used in operations 957 002 Taxation paid - Net cash used in operating activities 957 002 Investing activities: Loans disbursed (15 556 929)Loans repaid 12 643 338Acquisition of plant and equipment 13 (44 634) Net cash generated from investing activities (2 958 225) Financing activities: Proceeds from issue of preference shares 15 24 514 119Proceeds from disposal of liquid investments 8 930 544 Net cash generated from financing activities 33 444 663 Net movement in cash and cash equivalents 31 443 440Cash and cash equivalents transferred at 1 January 21 004 706Cash and cash equivalents at end of the period 9 52 448 146



Notes to the financial statementsfor the period ended 31 December 2012

1. Reporting entity Norsad Finance Limited is a company domiciled in Botswana registered under the Botswana Companies

Act. Norsad Finance Limited was established to take over the activities of the Norsad Fund following the dissolution of the Fund. All assets and liabilities of the Norsad Fund were transferred to Norsad Finance Limited on 1 January 2012.

2. Basis of preparation

(a) Statement of compliance The financial statements have been prepared in accordance with the International Financial Reporting

Standards (IFRS).

(b) Basis of measurement The financial statements are prepared on the historical cost basis, except for financial instruments

which are disclosed at fair value.

(c) Functional and presentation currency The financial statements are presented in US Dollar, which is also the functional currency.

(d) Use of estimates and judgements The preparation of financial statements in conformity with IFRSs requires management to make

judgements, estimates and assumptions that affect the application of policies and the reported amounts of assets and liabilities, income and expenses actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.



3. Significant accounting policies (a) Foreign currency Foreign currency translations Transactions in foreign currencies are translated into the functional currency of company at the spot

exchange rates at the date of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the spot exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortised cost in foreign currency translated at the spot exchange rate at the end of the period.

(b) Interest Interest income and expense are recognised in profit or loss using the effective interest method. The

effective interest rate is the rate that exactly discounts the estimated future cash payments and receipts through the expected life of the financial asset or liability (or, where appropriate, a shorter period) to the carrying amount of the financial asset or liability. When calculating the effective interest rate, the company estimates future cash flows considering all contractual terms of the financial instrument, but not future credit losses.

The calculation of the effective interest rate includes all transaction costs and fees and points paid or received that are an integral part of the effective interest rate. Transaction costs include incremental costs that are directly attributable to the acquisition or issue of a financial asset or liability.

Interest income and expense presented in the statement of comprehensive income include: - interest on financial assets and financial liabilities measured at amortised cost calculated on an effective interest basis; and - interest on available-for-sale investment securities calculated on an effective interest basis.

(c) Fee and commissions Fees and commission income and expense that are integral to the effective interest rate on a financial

asset or liability are included in the measurement of the effective interest rate.

Other fees and commission income are recognised as the related services are performed. When a loan commitment is not expected to result in the draw-down of a loan, the related loan commitment fees are recognised on a straight-line basis over the commitment period.



(d) Dividends Dividend income is recognised when the right to receive income is established. Usually this is the

ex-dividend date for equity securities. Dividends are presented in other operating income based on the underlying classification of the equity investment.

(e) Tax expense Tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in

profit or loss except to the extent that they relate to items recognised directly in equity or in other comprehensive income.

(f) Financial assets and financial liabilities (i) Recognition The company initially recognises loans and advances and deposits on the date that they are originated.

A financial asset or financial liability is measured initially at fair value plus, for an item not at fair value through profit or loss, transaction costs that are directly attributable to its acquisition or issue.

(ii) Classification Financial assets The company classifies its financial assets in one of the following categories: - loans and receivables; or - available-for-sale

Financial liabilities The company classifies its financial liabilities, other than financial guarantees and loan commitments, as measured at amortised cost.

(iii) Amortised cost measurement The amortised cost of a financial asset or liability is the amount at which the financial asset or liability is

measured at initial recognition, minus principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between the initial amount recognised and the maturity amount, minus any reduction for impairment.



(iv) Fair value measurement Fair value is the amount for which an asset could be exchanged, or a liability settled, between

knowledgeable, willing parties in an arm’s length transaction on the measurement date.

When available, the company measures the fair value of an instrument using quoted prices in an active market for that instrument. A market is regarded as active if quoted prices are readily and regularly available and represent actual and regularly occurring market transactions on an arm’s length basis.

(v) Identification and measurement of impairment At each reporting date the company assesses whether there is objective evidence that financial assets

are impaired. A financial asset or a group of financial assets is impaired when objective evidence demonstrates that a loss event has occurred after the initial recognition of the asset(s) and that the loss event has an impact on the future cash flows of the asset(s) that can be estimated reliably.

Objective evidence that financial assets are impaired can include significant financial difficulty of the borrower or issuer, default or delinquency by a borrower, restructuring of a loan or advance by the company on terms that the company would not otherwise consider, indications that a borrower or issuer will enter bankruptcy, the disappearance of an active market for a security, or other observable data relating to a group of assets such as adverse changes in the payment status of borrowers or issuers in the group, or economic conditions that correlate with defaults in the group. In addition, for an investment in an equity security, a significant or prolonged decline’ in its fair value below its cost is objective evidence of impairment. In general, the company considers a decline of 20 percent to be significant and a period of twelve months to be prolonged. However, in specific circumstances a smaller decline or a shorter period may be appropriate.

In assessing collective impairment the company uses statistical modelling of historical trends of the probability of default, the timing of recoveries and the amount of loss incurred, adjusted for management’s judgement as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than suggested by historical trends. Default rates, loss rates and the expected timing of future recoveries are regularly bench marked against actual outcomes to ensure that they remain appropriate.

Impairment losses on assets measured at amortised cost are calculated as the difference between the carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate.



(g) Cash and cash equivalents Cash and cash equivalents include notes and coins on hand and highly liquid financial assets with original

maturities of three months or less from the acquisition date that are subject to an insignificant risk of changes in their fair value, and are used by the company in the management of its short-term commitments.

Cash and cash equivalents are carried at amortised cost in the statement of financial position.

(h) Loans and advances Loans and advances are non-derivative financial assets with fixed or determinable payments that are

not quoted in an active market and that the company does not intend to sell immediately or in the near term.

Loans and advances to financial institutions and directly to customers are classified as loans and receivables.

Loans and advances are initially measured at fair value plus incremental direct transaction costs, and subsequently measured at their amortised cost using the effective interest method.

(i) Plant and equipment (i) Recognition and measurement Items of plant and equipment are measured at cost less accumulated depreciation and any

accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. When parts of an item of plant or equipment have different useful lives, they are accounted for as separate items (major components) of plant and equipment.

Any gain or loss on disposal of an item of plant and equipment (calculated as the difference between the net proceeds from disposal and the carrying amount of the item) is recognised within other income in profit or loss.

(ii) Subsequent costs Subsequent expenditure is capitalised only when it is probable that the future economic benefits of the

expenditure will flow to the company. Ongoing repairs and maintenance are expensed as incurred. (iii) Depreciation Items of plant and equipment are depreciated from the date they are available for use or, in respect of

self-constructed assets, from the date that the assets are completed and ready for use. Depreciation is calculated to write off the cost of items of plant and equipment less their estimated residual values using the straight-line basis over their estimated useful lives. Depreciation is recognised in profit or loss.



Significant items of plant and equipment are depreciated as follows: - Motor vehicles 25% reducing balance - Office equipment 20% straight line

Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

(j) Financial guarantees and commitments Financial guarantees are contracts that require the company to make specified payments to reimburse

the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the terms of a debt instrument. Loan commitments are firm commitments to provide credit under pre-specified terms and conditions.

Liabilities arising from financial guarantees or commitments to provide a loan at a below-market interest rate are initially measured at fair value and the initial fair value is amortised over the life of the guarantee or the commitment. The liability is subsequently carried at the higher of this amortised amount and the present value of any expected payment to settle the liability when a payment under the contracts has become probable. Financial guarantees and commitments to provide a loan at a below-market interest rate are included within other liabilities.

The company has invested in a financial guarantee contract in which it retains 50% of the risks of the total facility amount. The maximum amount payable by the company, assuming all guarantees are called on, is US$2 504 967.

4. Financial Risk Management

(a) Introduction and overview The company has exposure to various risks from financial instruments, the most significant of which

are the following: - credit risk - liquidity risk - market risks - operational risks

Risk management framework The Company’s Board of Directors has overall responsibility for the establishment and oversight of the

company’s risk management framework. The company’s risk management policies are established to identify and analyse the risks faced by the company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the company’s activities. The company, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.



The Audit Committee oversees how management monitors compliance with the company’s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the company.

(b) Credit risk Credit risk is the risk of financial loss to the company if a customer or counterparty to a financial

instrument fails to meet its contractual obligations, and arises principally from the company’s loans and advances to customers and other banks. For risk management reporting purposes the company considers and consolidates all elements of credit risk exposure (such as individual obligor default risk, country and sector risk). The Board of Directors is responsible for the oversight and management of credit risk including:

- Formulating credit policies covering collateral requirements, credit assessment, risk grading and reporting, documentary and legal procedures, and compliance with regulatory and statutory requirements.

- Establishing the authorisation structure for the approval and renewal of credit facilities. - Limiting concentrations of exposure to companies (10% of total shareholders equity), groups of

companies (20% of total shareholders equity) and country (30% of total shareholders equity). - Developing and maintaining the company’s risk gradings in order to categorise exposures according to the degree of risk of financial loss faced and to focus management on the attendant risks. The risk grading system is used in determining where impairment provisions may

be required against specific credit exposures. The current risk grading framework consists of three grades reflecting varying degrees of risk of default and the availability of collateral or other credit risk mitigation. The responsibility for setting risk grades lies with the Board of Directors and are subject to regular reviews

- Reviewing compliance with agreed exposure limits. Regular reports on the credit quality of portfolios are provided to Board of Directors who may require appropriate corrective action to

be taken

The Investment Officers undertake the entire project proposal process for potential customers including input from an internal screening committee, before they can be submitted to the Board of Directors for approval of the loan amount to be disbursed. On a continual basis the Portfolio Officers monitor the operations of the customers to assess the customers ability to make the repayments. In an event where the customer is unable to fulfil the repayment plan, an impairment provision of the loan is determined taking into consideration the recoverable amount of the collateral pledged by the customer.



The tables below set out information about the credit quality of financial assets and the allowance for impairment/loss held by the company against those assets. Allowance for impairment held against assets classified within credit grade A is in respect of losses incurred but not yet specifically identified. The carrying amount of assets with credit grade A that are collectively impaired represents the estimated proportion of the total assets within these grades (rather than individually identified assets) to which such allowance is estimated to relate.

Exposure to credit risk

31 December 2012 Notes

Carrying amount 11 16 161 084 30 205 884 276 863Assets at amortised cost: Individually impaired: Grade B: Performing with difficulties 531 200 - -Grade C: None or very poor performing 1 635 194 - -Gross amount 2 166 394 - -Allowance for impairment 11 (1 635 194) - -Carrying amount 531 200 - -Collectively impaired: Grade A: Well or reasonably well performing 15 629 884 30 205 884 276 863Gross amount 15 629 884 30 205 884 276 863Allowance for impairment - - -Carrying amount 15 629 884 30 205 884 276 863

Loans and advances direct to

customers

Loans and advances to

financial institutions

Investment securities



Exposure to credit risk (continued)

Available for sale assets Collectively impaired: Grade A: Well or reasonably well performing - - 276 863Gross amount - - 276 863Allowance for impairment - - -Carrying amount - - 276 863Ageing analysis: Neither past due nor impaired 13 191 314 30 205 884 276 863Past due not impaired: 30 – 60 days 248 300 - -60 – 90 days - - -90 – 180 days - - -+ 180 days 2 721 470 - -Carrying amount 16 161 084 30 205 884 276 863

The company has issued financial guarantee contracts in respect of debtors graded A and for which the maximum amount payable by the company, assuming all guarantees are called on, is US$2 504 967.

Impaired loans and investment debt securitiesThe company regards a loan and advance as impaired where there is objective evidence that a loss event has occurred since initial recognition and such loss event has an impact on future estimated cashflows from the asset. In addition, a loan is considered impaired if it is overdue for 90 days or more. Loans that are subject to a collective provision for losses incurred but not yet identified (IBNR) are not considered impaired. Impaired loans and advances are graded B to C in the company’s internal credit risk grading system. Note 11 provides details of impairment allowance for loans and advances.

Loans and advances direct

to customers






Set out below is an analysis of the gross and net (of allowance for impairment) amounts of amounts individually impaired assets per risk grade.

Loans and advances to customers31 December 2012 Gross NetGrade B: Performing with Difficulties 531 200 531 200Grade C: None or Very Poor Performing 1 635 194 - 2 166 394 531 200

Concentration of credit risk The company monitors concentrations of credit risk by sector and geographic location. An analysis of concentrations of credit risk from loans and advances, lending commitments financial guarantees, and investment securities is shown below:

31 December 2012

Carrying amount 16 161 084 30 205 884 276 863 2 504 967Concentration by sector: Corporate 16 161 084 - 276 863 -Financial Institutions - 30 205 884 - 2 504 967 16 161 084 30 205 884 276 863 2 504 967Concentration by location: Malawi 6 994 993 4 426 976 - -Zambia 2 985 499 6 571 375 - -Zimbabwe 776 351 8 491 346 276 863 -Angola 329 745 5 831 400 - -Swaziland - 4 582 378 - -Mozambique 3 018 750 - - -Namibia - - - 2 504 967Tanzania 2 055 746 302 409 - - 16 161 084 30 205 884 276 863 2 504 967

Loans and advances direct

to customers




Financialguarantees



Asset by type Cash and cash equivalents 9 52 443 871 52 356 303 87 568 - -Loans and advances 11 46 366 968 4 525 160 13 754 199 27 427 454 660 155Investment securities 10 276 863 - - - 276 863 99 087 702 56 881 463 13 841 767 27 427 454 937 018

Concentration by location for loans and advances, and for financial guarantees is based on the customer’s country of domicile. Concentration by location for investment securities is based on the country of domicile for the issuer of the security.

Cash and cash equivalentsThe company held cash and cash equivalents of US$ 52 443 871 as at 31 December 2012. The cash and cash equivalents with banks are held with financial institution counterparties which are rated BBB+ per Fitch ratings.

(c) Liquidity riskLiquidity risk is the risk that the company will encounter difficulty in meeting obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. Management of liquidity riskThe company’s Board of Directors sets the company’s strategy for managing liquidity risk and is responsible for the implementation of this policy. The company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the company’s reputation.

The key elements of the company’s liquidity strategy are as follows:- Carrying a portfolio of highly liquid assets, diversified by currency and maturity; and- Monitoring liquidity ratios, maturity mismatches, behavioural characteristics of the company’s financial

assets and liabilities, and the extent to which the company’s assets are encumbered and so not available as potential collateral for obtaining funding.

Maturity analysis for financial assets and financial liabilitiesThe table below sets out the remaining contractual maturities of the Group’s financial assets and liabilities:

31 December 2012

Note Carrying amount

Less than 1 month

Within 1 year

1 to 5years

More than 5 years



Maturity analysis for financial assets and financial liabilities(continued) The above tables show the undiscounted cash flows on the company’s non-derivative financial assets and liabilities, including issued financial guarantee contracts, and unrecognised loan commitments on the basis of their earliest possible contractual maturity. For issued financial guarantee contracts, the maximum amount of the guarantee is allocated to the earliest period in which the guarantee could be called. As part of the management of its liquidity risk arising from financial liabilities, the company holds liquid assets comprising cash and cash equivalents for which there is an active and liquid market so that they can be readily sold to meet liquidity requirements.

(d) Market risksMarket risk is the risk that changes in market prices, such as interest rates, equity prices and foreign exchange rates will affect the company’s income or the value of its holdings of financial instruments. The objective of the company’s market risk management is to manage and control market risk exposures within acceptable parameters in order to ensure the company’s solvency while optimising the return on risk.

Exposure to interest and exchange rate risk The principal risk to which non-trading portfolios are exposed is the risk of loss from fluctuations in the future cash flows or fair values of financial instruments because of a change in market interest rates.

Interest rate movements affect reported equity in the following ways:- retained earnings arising from increases or decreases in net interest income and the fair value changes

reported in profit or loss; and - fair value reserves arising from increases or decreases in fair values of available-for-sale financial

instruments reported directly in equity

Equity price risk is subject to regular monitoring by the Board of Directors, but is currently not significant in relation to the overall results and financial position of the company. The effect of structural foreign exchange positions on the company’s net investments in its foreign branch is recognised in other comprehensive income. As at the reporting date, net currency exposures in foreign branch represented less than 1% of the company’s equity and is currently not significant in relation to the overall results and financial position of the company. (e) Operational risksOperational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the company’s processes, personnel, technology and infrastructure, and from other external factors other than credit, market and liquidity risks, such as those arising from legal and regulatory requirements and generally accepted standards of corporate behaviour. Operational risks arise from all of the company’s operations.



The company’s objective is to manage operational risk so as to balance the avoidance of financial losses and damage to the company’s reputation with overall cost effectiveness and innovation. In all cases, the company policy requires compliance with all applicable legal and regulatory requirements.

20125.Interest income from loans and advances Loans and advances to customers 1 426 864Loans and advances to financial institutions 2 359 361 3 786 2256.Other operating income Write back of provisions for the period 1 235 529Recoveries from projects written off 26 894Dividend income from equity investments 11 352 1 273 7757.Operating Expenses NORSAD Agency fees for quarter ended 31 March 2012 442 170Staff costs 1 216 878Administrative costs 480 173Office Relocation costs 222 702 2 361 9238.Current TaxationTaxation reconciliation Taxation at the statutory rate of 15% on taxable profit 149 113Foreign Withholding tax suffered 285 468Taxation per statement of comprehensive income 434,581

9.Cash and cash equivalents Balances with banks 52 443 871Petty cash 4 275 52 448 146 10. Financial assets designated at fair value Market value at acquisition on 1 January 442 980Market price movements in the period (166 117)Market value as at 31 December 276 863

These relate to equity investments in the form of quoted shares held in Colcom Holding Limited, a company incorporated in Zimbabwe. The company’s shareholding in Colcom Holdings Limited is less than 20%.



11. Loans and advances Loans and advances to financial institutions 30 205 884Loans and advances direct to customers 17 796 278Less specific allowance for impairment (1 635 194) 46 366 968Specific allowances for impairment Balance transferred at 1 January 2012 4 562 551Charge for the period 623 007Write back of provisions for the period (1 235 529)Write-offs against provisions (2 314 835)Balance as at 31 December 2012 1 635 194

12. Other assets Loans and advances to employees 70 398Prepayments 50 049 120 447

13. Plant and equipment Motor vehicles Office & Other equipment Total

Cost Book Value transferred at 1 January 98 200 30 253 128 453Additions 22 832 21 802 44 634Disposals (36 138) (5 293) (41 431)Balance as at 31 December 2012 84 894 46 762 131 656Accumulated depreciationCharge for the period 14 043 12 361 26 404Balance as at 31 December 2012 14 043 12 361 26 404 Carrying amounts As at 31 December 2012 70 851 34 401 105 252

14. Accruals and other liabilities Accruals 130 101PAYE and other taxes 27 074 157 175



15. Stated capital Ordinary shares Preference shares

8 800 shares at nil par value 73 071 690 -2 961 shares at USD 8 279 per share - 24 514 119 73 071 690 24 514 119 The holders of ordinary and preference shares are entitled to one vote per share at meetings of the company. The distribution of any dividends declared from time to time shall ensure that the amount paid to a preference share shall be twice the amount paid as dividend to an ordinary share. Preference shares rank in priority over ordinary shares with regard to the company’s residual assets. Norfund has subscribed to 1 123 preferential shares at a value of USD 9 297 317 but has not yet paid for the shares. The shareholding of the company is as follows: 31 December 2012 Number of sharesShareholder name Domicile Ordinary Preference

Citizen Entrepreneurial Development Agency Botswana 400 -Investment Fund for Developing Countries Denmark 968 1 161Finnish Fund for Industrial Cooperation Ltd Finland 968 906Lesotho Postbank Limited Lesotho 400 -Export Development Fund Malawi 400 -The State Investment Cooperation Ltd Mauritius 400 -Instituto de Gestão das Participações de Estado Mozambique 400 -Development Bank of Namibia Namibia 400 -Norwegian Investment Fund for Developing Countries Norway 968 -National Industrial Development Cooperation of Swaziland Swaziland 400 -Swedfund International AB Sweden 1 496 894Tanzania Investment Bank Ltd Tanzania 400 -Development Bank of Zambia Zambia 400 - Infrastructure Development Bank of Zimbabwe Zimbabwe 400 -Held on escrow by Collins Newman & Co attorneys n/a 400 - Total shares 8 800 2 961



16. Subsequent eventsThe Directors are not aware of any matters or circumstances arising since the end of the financial period, not dealt with in the report or financial statements that would significantly affect the operation of the company or the result of its operations. 17. Comparative balancesThe company was incorporated on 24 November 2011; therefore the company’s first period of operation is from the date of incorporation to 31 December 2012. No comparative balances are thus presented.


Norsad Finance LtdPlot 74770, Western Commercial Road,

CBD, Gaborone, BotswanaTel:+267 316 0860

Web: www.norsadfinance.comEmail: [email protected] Investing in Sustainable Enterprise Growth

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