ohlthaver & list · company) and its affiliated companies, for the period 1 july 2016 to 30...
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I N T E G R A T E D A N N U A L R E P O R T
OHLTHAVER & LIST
SINCE 1919 OUR GROUP OF COMPANIES HAS BEEN INSPIRED BY THE LAND TO CREATE A SUSTAINABLEFUTURE THAT HAS LASTING IMPACT ON THE NAMIBIAN ECONOMY AND ITS PEOPLE.
FROM RESOURCE TO RESULTS.
Page 6 ABOUT THIS REPORT
About this Integrated Annual Report
Page 9 ABOUT OHLTHAVER & LIST Vision 2019, Group Portfolio, Directorate & Administration, Group Executive Team, Operating Structure, Materiality, Supply Chain
Page 34 UNDER REVIEW Executive Chairman’s and Chief Executive Officer’s Message, Operational Review
Page 54 SUSTAINABILITY Corporate Governance, Economic, Social and Environmental Sustainability
Page 88 REPORTS Assurance Statement, Group Value Added Statement, Seven Year Review, Financial Review, Group Reference Information,
Notice to Shareholders, Proxy Form
PLEASE GO TO WWW.OHLTHAVERLIST.COM TO VIEW OUR FINANCIAL STATEMENTS AND GRI INDEXApproval of Financial Statements, Independent Auditor’s Report, Report of the Directors, Statements of Financial Position,
Statements of Profit or Loss and Other Comprehensive Income, Statements of Changes in Equity, Statements of Cash Flows,
Accounting policies, Notes to the Annual Financial Statements.
ABOUT THIS ANNUAL REPORT
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ABOUT THIS ANNUAL REPORT
07
The Ohlthaver & List Group remains committed to embracing its
obligations as a corporate citizen towards the wide variety of spheres
in which it operates, including its shareholders, employees and the
environment. At the same time, we are aiming to build and sustain a
sound corporate reputation while creating conditions that are conducive
to profitable businesses. This is apparent in the Group’s Purpose: ‘Creating
a future, enhancing life’, which is inextricably linked to uplifting our
communities and protecting the environment in a sustainable manner.
Guided by our Purpose, the Group strives to bring quality of life and
wellbeing to people in order to improve the socio-economic conditions
of citizens; create conditions for everyone to succeed; continually pioneer
and operate at breakthrough levels; build innovative and sustainable
businesses; and generate long-term profitability.
This Integrated Annual Report provides a detailed overview of the
impacts of all sustainability-related activities of the Ohlthaver & List
Group (hereafter referred to as Ohlthaver & List, O&L, the Group, or the
Company) and its affiliated companies, for the period 1 July 2016 to 30
June 2017. In accordance with the recommendations of the Corporate
Governance Code of Namibia (NamCode), based on the Third Report of
the King Commission on Corporate Governance in South Africa (hereafter
referred to as King III), its content is intended to provide information on
all sustainability-related aspects of Ohlthaver & List’s operations in the
year under review. Furthermore, the Report is intended to provide an
indication of the Company’s ability to continue to create such value for
our stakeholders in the future.
This Report has been compiled in accordance with the principles of the
G4 Reporting Standard (Core) of the Global Reporting Initiative (GRI).
Along with associated relevant information and the GRI Index, this Report
is also available on the Ohlthaver & List website at www.ohlthaverlist.com.
In the preparation of this Integrated Annual Report, O&L has attempted
to identify and report on the most significant sustainability- related
considerations and impacts arising from the core activities of the Group,
as well as all significant internal and external stakeholder groups with
which the Group engages around these issues.
For additional information regarding this Integrated Annual Report and its
contents, readers are invited to contact Roberta Brusa, Group Company
Secretary, on +264 61 2075111 Ext. 5313, or by email at [email protected].
THE SCOPE AND BOUNDARY OF THE INTEGRATED ANNUAL REPORT
This Integrated Annual Report covers the operations of the Ohlthaver
& List Group in their entirety − including those of its subsidiaries and
joint ventures − in all markets in which these entities operated over the
reporting period. In this regard, an overview of the Group is included in
the Report, on pages 14-17.
The Integrated Annual Report is designed to provide all stakeholders with
relevant information regarding the value creation offered by the Group
through its activities on an annual basis, as well as the economic, social
and environmental impacts arising from these activities. Operational
activities are analysed within the context of the food production, fishing,
beverages, farming, retail-trade, information technology, property
leasing and development, marine engineering, steel-retailing, renewable
power-generation and leisure and hospitality industries that the Group
has interests in, as well as the broader macroeconomic climate in which
the Group operates.
The Integrated Annual Report also discusses Ohlthaver & List’s risks and
opportunities, as well as its forward planning for sustainable growth.
It represents a milestone along the route towards the integrated and
targeted reporting that all stakeholders require in order to acquire well-
informed opinions of the Group and its activities.
ABOUT THIS INTEGRATED ANNUAL REPORT
ABOUT THIS ANNUAL REPORT
Source data is gathered from the Group’s various operating divisions and
is, to the best extent possible, integrated so as to provide comparable
performance data.
The Report includes disclosures on both financial and non-financial
aspects of the Group. Financial disclosures correspond with those of
the Company’s Annual Financial Statements for the 2017 financial year,
a document that was compiled in accordance with the requirements
of the Companies Act (Act 28 of 2004) of Namibia and complies with
International Financial Reporting Standards (IFRS).
With respect to the availability of non-financial data, in instances where
insufficient data exists to address various quantitative indicators included
in the GRI G4 Guidelines, the Report then focuses on relevant policies
and practices that have been implemented within the Group and its
subsidiaries − particularly those related to regulatory compliance in
various areas.
MATERIALITY
It is the opinion of the Ohlthaver & List Board and management that the
information presented in this 2017 Integrated Annual Report is the most
relevant, or material, to the Group and its various stakeholder groups.
PROCESS FOR IDENTIFYING CONTENT
In analysing the information to be included in the Integrated Annual
Report, the Board and management considered two primary questions:
firstly, “Who is our reporting aimed at?” and secondly, “What decisions will
they be able to make based on our reporting?”
In this context, it is the intention of Ohlthaver & List that this Integrated
Annual Report:
- Informs and adds value for all stakeholders with a valid interest in the
Group;
- Considers all issues that can impact on the Group’s ability to create
value for these stakeholders; and
- Reports as comprehensively as possible on the known and potential
impacts of these issues for the Group and its stakeholders.
In identifying the issues and information to be included in this Report,
the Board considered the relative importance of each matter in terms
of its known or potential effects on Ohlthaver & List’s ability to continue
creating value for all its stakeholders. These matters were then ranked
in terms of relevance to the intended readership of the Report, so that
non-pertinent information could be set aside. We believe that this is in
line with the reporting principles for defining report content as defined
by the GRI.
This process is intended to produce accurate and comprehensive
sustainability reporting, unburdened by the peripheral data that tends
to confuse rather than enlighten. Readers are welcome to request more
detailed information on any particular aspect of the Report.
Further information regarding Ohlthaver & List’s material issues and
associated stakeholder groups can be found in this Report in the sections
dealing with Stakeholder Engagement (page 25) and Materiality (page 27).
ASSURANCE
Ohlthaver & List is confident that this Report provides a comprehensive
and balanced account of the Company’s financial management as well
as its environmental, social and governance (ESG) performance over the
year under review. The sustainability reporting principles and processes
employed by Ohlthaver & List are aligned with those of the GRI G4
Reporting Standard and this Report has been subjected to a process
of independent third-party assurance. The assurance statement can be
found on page 88.
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ABOUT THIS ANNUAL REPORT
FORWARD-LOOKING STATEMENTS
While this Integrated Annual Report is intended as a retrospective
review of Ohlthaver & List’s sustainability performance over its most
recently completed financial year, it also includes certain forward-looking
statements regarding the Group’s intended performance in these areas
in the future.
Although Ohlthaver & List believes that the expectations and outcomes
reflected in such forward-looking statements are reasonable, no
assurance can be provided that such expectations will ultimately prove
correct. Accordingly, future outcomes could differ materially from those
set out in these forward-looking statements as a result of (among other
factors): changes in economic and market conditions; the success of
business and operating initiatives; changes in the regulatory environment
and/or other government action; fluctuations in commodity prices and
exchange rates; and business and operational risk management.
A discussion of the sustainability-related risks and opportunities facing
Ohlthaver & List is included in the Corporate Governance section of this
Report, on page 54.
CONTACT DETAILS
O&L Group of Companies
Alexander Forbes House
7th Floor, South Block
23-33 Fidel Castro Street
Windhoek, Namibia
Postal address:
P.O. Box 16, Windhoek, Namibia
Corporate Relations:
Tel: +264 61 2075111
Fax: +264 61 234021
WHO WE AREOUR BUSINESS PROFILE
As a truly African company employing more than 6 100 people in various
business sectors, the Ohlthaver & List Group is rooted in, and committed
to, Africa and her diverse communities. The Group emerged in 1919 from
the early Ohlthaver & List Bank Kommission partnership between Hermann
Ohlthaver and Carl List; subsequently Ohlthaver & List Finance and Trading
Corporation Limited (Olfitra) was established in Namibia on the 13th of May
1923. The Group’s Headquarters is located in Windhoek, Namibia.
Today, O&L represents Namibia’s largest privately held group of companies,
with revenues contributing in excess of 5% to GDP. It has business
interests in food production, fishing, beverages, farming, retail trade,
information technology, property leasing and development, renewable
power-generation, marine engineering, steel retailing, advertising, and
the leisure and hospitality industry.
The parent companies of Olfitra are O&L Holdings (Proprietary) Limited
and List Trust Company (Proprietary) Limited, with the controlling
shareholder of the O&L Group being the Werner List Trust.
With annual revenues of over N$6 billion, O&L is a major contributor to
the state coffers and is in the position of being a significant contributor
to GDP in Namibia. Wherever they operate, the companies of our diverse
Group are actively engaged in uplifting the lives of our employees, our
consumers, and society more generally. We at O&L are relentless in our
pursuit of a sustainable future for all and therefore passionately embrace
our Purpose: ‘Creating a future, enhancing life’ in everything we do,
while actively pursuing our Vision: ‘To be the most progressive and
inspiring company’.
ABOUT OHLTHAVER & LIST
ABOUT OHLTHAVER & LIST
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STRATEGIC OUTCOMES
The most progressive and inspiring company
BREAKTHROUGH ARCHITECTURE
CREATING A FUTURE, ENHANCING LIFE
PURPOSE
Let’s Talk | Let’s do it | Hooked on results | Naturally today for tomorrow | We grow people | We do the right thing right | We all serve
VALUES
N$2 billion EBIT | 4 000 additional employment opportunities | Employer of choice | 20% reduction in carbon footprint
BREAKTHROUGH METRICS
Everyone purposefully
producing breakthrough
everywhere
Amazing experiences,
enduring impact
Sustainable execution
in everything
2019 STRATEGIC AREAS OF FOCUS
Everyone is deeply connected to
purpose, lives the values and is
proud of what they do
Everyone is successful, thriving
and making things happen in
breakthrough mode
Everyone is valued, recognised
and appreciated for the
difference they make
Consistent experiences, amazing
relationships, lasting impact
Purity inspired, reliable quality,
impacting the whole
Always there, simple and easy,
the natural choice
Excellence in everything,
executed with care
Sustaining growth, ever-expanding,
securing the future
Bringing sustainability everywhere,
impacting the world
Inspired by integrity, creating trust
and confidence
2019 VISION
TO BE THE MOST PROGRESSIVE
AND INSPIRING COMPANY
LET’S TALK
Open, honest, down-to-earth,
from-the-heart communication
LET’S DO IT Deliver on tasks with speed
and quality
HOOKED ON RESULTS Committed to delivering breakthrough
outcomes
NATURALLY TODAY FOR TOMORROW
Caring about the future,
caring about everyone
WE GROW PEOPLE Taking responsibility and providing
opportunities for growth
WE DO THE RIGHT THING RIGHT
Bringing thinking to everything
WE ALL SERVE Serving the purpose, owning
the whole, everyone matters
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BRANDTRIBE
Established in 2012, Brandtribe is a joint venture
between O&L and Techsys (CT). Brandtribe is a
multi-channel consumer optimisation platform
combining return on investment and the underlying
data to provide brands with a sustainable competitive
advantage in the digital age. Brandtribe has created
and manages two digital platforms: the Brandtribe
SMS gateway and the Brandtribe e-CRM platform.
Brandtribe tracks the digital effectiveness of brands
all in one place, from advertising effectiveness to
consumer interactions.
BROLL NAMIBIA
Broll and List Property Management (Namibia)
(Proprietary) Limited (Broll Namibia) is a strategic
partnership between O&L and the Broll Property
Group, SA. Established in 2003, it has been
managing O&L’s Commercial Portfolio which
includes Wernhil Park, Standard Bank Centre/Town
Square, Alexander Forbes House/Carl List Mall, the
Old Breweries Building and Pick n Pay Centre in
Walvis Bay. Broll Namibia also manages 3rd party
properties including The Grove Mall and B1 City
and has recently obtained the management
contract for the Dunes Mall in Walvis Bay.
DIMENSION DATA NAMIBIA
Dimension Data Namibia (Proprietary) Limited
was established in November 2006 as a business
partnership between the O&L Group and
Dimension Data Middle East and Africa. It has
grown considerably since then and is currently
one of Namibia’s most successful information
technology (IT) solution providers. It services
highly strategic Namibian clients, both within and
outside the O&L Group, and has a global footprint
with great penetration in Africa.
KRAATZ MARINE
Kraatz Marine (Proprietary) Limited was
established in 1947 and provides engineering
and related services to the oil and gas, mining,
and general industrial sectors. These services
include ship repair, rig repair, fabrication,
machining, welding and construction.
HANGANA SEAFOOD
Hangana Seafood (Proprietary) Limited, established
in 1997, is the operating company for the white
hake quota holders, Consortium Fisheries Limited
and Kuiseb Fish Products (Proprietary) Limited.
Hangana Seafood is recognised as a leader in
the Namibian fishing industry and has a wet-fish
fleet of eight vessels. The company’s land-frozen
products are mainly exported to Australia, France,
Germany, Italy, the Netherlands, Spain, the United
States, and the Southern African Development
Community (SADC) region.
GROUP PORTFOLIO
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NAMIBIA BREWERIES
Established in 1920, Namibia Breweries
Limited (NBL) is a frontrunner in the beverage
manufacturing sector in Namibia. The company
leads the domestic beer market and its brands
have a significant share of the premium beer
category in southern Africa. Brewed by choice
according to the Reinheitsgebot of 1516,
NBL beer enjoys a fine reputation for quality
and purity, for which its brands have earned
international recognition.
NAMIBIA DAIRIES
Namibia Dairies (Proprietary) Limited was created
in 1997, following the merger of Rietfontein
Dairies and Bonmilk. Since then it has grown into
Namibia’s primary dairy and juice manufacturing
company, with a total annual production in
excess of 37 million litres. The company is
the country’s market leader, with significant
market share in all its product categories. It also
operates one of the most modern dairy farms
in the world, the !Aimab Superfarm, which is
located in Mariental in southern Namibia.
O&L ENERGY
O&L Energy (Proprietary) Limited focuses on
renewable energy. It develops, designs, procures
and implements renewable energy projects,
especially medium- to large-scale solar power
and bioenergy systems. O&L Energy and its
international partners offer the highest German
engineering and efficiency standards, with the
best workmanship and reliability possible. These
result in maximum energy saving results, as well
as important contributions to the improvement
of our environment.
O&L LEISURE
The O&L Leisure Portfolio is made up of the
106-room Mokuti Etosha Lodge; the 46-room
Midgard Country Estate; the boutique, 16-room
Chobe Water Villas lodge; and the 125-room,
4-star Strand Hotel Swakopmund. Built on a
historic and iconic site, with unique and creative
entertainment areas like restaurants, bars, a deli,
lobby lounge, sea-facing terraces, and a beach
take-away – the Strand Hotel has become a
premier destination for residents of Swakopmund
as well as for visitors from around the world.
MODEL PICK N PAY
Leading retailer Model Pick n Pay is the direct
descendant of Model Supermarkets. In 1997 a new
franchise agreement was entered into with
Pick n Pay South Africa. The first Model Pick n Pay
supermarket was subsequently inaugurated in
1997. To build its brand, Model Pick n Pay has
embarked on a strategy to extend its network
of franchise stores throughout Namibia, with
22 stores countrywide to date. The franchisee
attributes their success to the delivery of quality,
variety, customer service and value for money.
WEATHERMEN & CO
A joint-venture between O&L and leading Cape
Town advertising agency, The Jupiter Drawing
Room, Weathermen & Co. started with a staff
complement of 5 in 2013. Today, 19 staff
strong, this through-the-line communication
agency is proving to be a bellwether for its
clients and the advertising industry as a whole
and continues to secure new additions to its
flourishing list of clients. Its employees stand
proud as the weathermen, and ambassadors of
inspiration in advertising in Namibia.
WINDHOEK SCHLACHTEREI
Windhoek Schlachterei (Proprietary) Limited,
acquired in the 1970s, is known for its processed
meat products crafted in the European
continental tradition. The company is the
second-largest processed meat producer in the
country, with a local market share volume of
16%. Windhoek Schlachterei was fully integrated
into Namibia Dairies in 2010 to consolidate and
optimise its manufacturing, sales and distribution,
marketing, and administrative functions on its
journey to becoming a sustainable operation.
O&L CENTRE
The Ohlthaver & List Centre (Proprietary)
Limited comprises two divisions. O&L Corporate
includes the Group Leadership Team, which
leads group strategy; the Centre of Excellence
renders specialist services ranging from payroll
and human capital support to SAP business
management software and IT services to all
operations in the O&L Group.
KRAATZ STEEL
Kraatz Steel, a division of WUM Properties
(Proprietary) Limited, operates from Walvis Bay
and Tsumeb and has been engaged in industrial
steel supplies in Namibia since 1995. The
company supplies steel, steel-related products,
and non-ferrous metals to marine engineering
and construction companies, the mining sector
(on land and offshore), fishing factories/vessels,
oil and petroleum plants, and the general
public.
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DIRECTORATE AND ADMINISTRATION
NON-EXECUTIVE DIRECTORS
UM STRITTER
Vice-chairman
Appointed to the Board on 24 March 1994
Elected vice-chairman on 17 April 2002
C-L LIST
Appointed to the Board on 27 February
1980
E ENDER (German)
Appointed to the Board on 23 June 2008
HH MÜSELER
Appointed to the Board on 20 March 2014
GOVERNOR LV MCLEOD-KATJIRUA
Appointed to the Board on 2 April 2012
REVEREND WS HANSE
Appointed to the Board on 2 April 2012
EXECUTIVE DIRECTORS
S THIEME
Executive Chairman
Appointed to the Board in 2001
Elected Chairman of the Board on 17 April
2002
P GRÜTTEMEYER
Chief Executive Officer
Appointed to the Board on 1 October 2003
G HANKE
Group Financial Director
Appointed to the Board on 16 November
2004
B MUKUAHIMA
Group Human Capital Director
Appointed to the Board on 1 May 2006
G SHILONGO
Group Corporate Affairs Director
Appointed to the Board on 9 July 2014
P HOEKSEMA
Alternate to S Thieme
Appointed to the Board on 1 October 2015
ADMINISTRATION
Company Registration Number 331
(Incorporated in Namibia)
SECRETARY
Ohlthaver & List Centre (Pty) Ltd
Postal address:
PO Box 16
Windhoek
BUSINESS ADDRESS AND REGISTERED OFFICE
7th floor – South Block
Alexander Forbes House
23-33 Fidel Castro Street
Windhoek
AUDITORS
Deloitte & Touche
Registered Accountants and Auditors
Chartered Accountants (Namibia)
PO Box 47
Windhoek
ATTORNEYS
Engling, Stritter & Partners
PO Box 43
Windhoek
BOARD COMMITEES
AUDIT COMMITTEE
HH Müseler, Chairman
P Grüttemeyer
REMUNERATION COMMITTEE
Dr C Swart-Opperman, Chairman (appointed 19 July 2016)
P Grüttemeyer
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2
1. SVEN THIEME Executive Chairman 2. PETER GRÜTTEMEYER Chief Executive Officer 3. BERTHOLD MUKUAHIMA Group Human Capital Director
4. PATRICIA HOEKSEMA Group Manager: Corporate Relations 5. GIDEON SHILONGO Group Corporate Affairs Director
6. GÜNTHER HANKE Group Financial Director 7. HERMAN THERON MD: Hangana Seafood 8. TERENCE MAKARI MD: O&L Leisure
9. HENDRIK VAN DER WESTHUIZEN MD: Namibia Breweries 10. NORBERT WURM MD: Model Pick n Pay
GROUP EXECUTIVE TEAM 1
3 4
5 6
7 8
9 10
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11. SONJA BARTSCH MD: Eros Air 12. LEON CROUS MD: Weathermen & Co 13. BERND WALBAUM MD: O&L Energy
14. GÜNTHER LING MD: Namibia Dairies & Windhoek Schlachterei 15. ROWAN KLEINTJES MD: Dimension Data 16. MIKE REILLY MD: Brandtribe
17. MARTIN THERON MD: O&L Centre 18. EIKE KRAFFT Director: Emerging Business 19. DIRK VAN NIEKERK MD: Kraatz Marine
20. MARCO WENK MD: Broll Namibia
11 12
13 14
15 16
17 18
19 20
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The Board acknowledges that there is no majority of Non-executive
Directors that are categorised as independent due to the O&L Group of
Companies being majority owned by two entities (Werner List Trust and
O&L Holdings).
Just as this Integrated Annual Report is prepared for a group of
companies, there are boards of directors at various subsidiaries. The
governance framework is determined by O&L and is then driven down to
each and every subsidiary.
CODE OF CONDUCT AND BUSINESS ETHICSPOLICY
A formal Code of Ethics and Business Conduct is in place to set out
standards of integrity in dealing with suppliers, customers, business
partners, stakeholders, government, and society generally. Every
employee is required to subscribe to this Code and strict adherence to
it is a condition of employment. Employees are also required to declare
other business interests, possible conflicts of interest, as well as any gifts
they receive that might leave them vulnerable to undue influence.
Compliance with the Code is monitored and employees are encouraged
to report any suspected contravention of the Code or other perceived
unethical behaviour.
The Group has implemented Tip-Offs Anonymous whereby employees,
suppliers and customers can report unethical activities without fear of
being identified. Tip-Offs Anonymous is operated by a company that is
wholly independent of O&L.
STAKEHOLDER ENGAGEMENTThe Group Purpose: ‘Creating a future, enhancing life’ is directed towards
stakeholders within and beyond the business operations. As the Group
realizes the impact its stakeholders have on the business, a proactive
stakeholder-inclusive approach to stakeholder engagement is embraced
by the Group leadership. O&L’s approach to stakeholder engagement
is determined by the principles of influence and dependency on the
Group, and this informs appropriate dialogue between the Group and its
stakeholders. O&L realizes that its stakeholders must be treated equitably
and therefore everyone strives to achieve an appropriate balance
between the interests of all the groups’ stakeholders in the best interest
of the Company.
Members of the Group’s Sustainability Steering Committee and O&L
Corporate conduct an annual stakeholder identification and impact
assessment with particular focus on the following Stakeholder groups:
A Employees
B Utilities Providers
C Government/Regulators
D Consumers/Customers
E Suppliers
F Financiers
G Industry Bodies
H Media
I Civil Society
J Trade Unions
K Equity Owners
As a critical stakeholder group, employees enjoy regular and constant
interaction through various employee engagement initiatives inclusive of
face-to-face communication, social media, e-mails, road shows, surveys,
intranet, social events, training sessions, performance reviews, leadership
conferences, staff meetings and internal publications.
STATEMENT OF COMPLIANCE The O&L Group is of the opinion that for the year under review, it is
substantially compliant in all material respects with the principles of the
Namibian Companies Act (2004) and the Corporate Governance Code of
Namibia (NamCode).
INTRODUCTIONThe O&L Group is committed to the highest standards of corporate
governance, including those promoted in the NamCode as well as the
King Report on Governance for South Africa, (King III), and has established
a process to review compliance with the recommendations they contain.
Particulars regarding O&L’s compliance with the NamCode are set out in
the Integrated Annual Report and where there has not been compliance,
explanations have been provided.
OUR OPERATING STRUCTUREDuring the period under review, the Board comprised six Executive
Directors and six Non-executive Directors. The names and appointment
dates of each of the Directors are set out on page 18.
The roles of the Executive Chairperson and the Chief Executive Officer are
kept separate in order to ensure a balance of power and authority, with
no one individual therefore having unrestricted decision-making powers.
The Board is responsible for the strategic direction of the Group: matters
reserved for the Board and its committees’ consideration are formally
defined to ensure that the Directors retain full and effective control
over the Group with specific regard to strategic, financial, organisational,
and compliance matters. All members of the Board have a fiduciary
responsibility to represent the best interests of the Group and all of its
stakeholders. All Directors have the appropriate breadth of expertise
to undertake their duties and have significant influence at meetings,
thereby ensuring a balance of authority and precluding unfettered
decision-making by any one Director. Procedures for appointment are
formal, transparent and for the full Board’s consideration − although
shareholders are ultimately responsible for the composition of the Board.
Appointment procedures involve evaluating the existing balance of skills
and experience within the Group and include a process of assessing the
Group’s needs.
A Director’s Induction Programme serves to familiarise incoming
Directors with the Group’s operations as well as its business environment,
strategies, Director’s duties, and the sustainability issues relevant to the
business.
A Board Evaluation Programme forms part of the Director’s Governance
Policy. It is implemented through the office of the Company Secretary
and the Audit Committee Chairman.
Generally, Directors have no fixed term of appointment but retire by
rotation. At each of the Group’s Annual General Meetings, at least one
third of the Directors retire (these being the Directors who have served
the longest since their last election). If they indicate that they are
available, they then are considered for reappointment. The Board of
Directors is chaired by the Executive Chairperson at the time; due to the
vast experience and in-depth knowledge he has of O&L businesses, the
incumbent has been retained in the position over this reporting period.
An evaluation of the independence of Non- executive Directors resulted
in the following assessment:
NON-EXECUTIVE DIRECTORS INDEPENDENCE
UM Stritter Shareholder representative
E Ender Independent
HH Müseler Independent
C-L List Shareholder representative
Reverend Hanse Shareholder representative
Governer McLeod-Katjirua Shareholder representative
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In order to remain competitive and adjust its product and service offerings
to meet the ever-changing needs of its customers and consumers, the
O&L Group actively engages these stakeholders through direct dialogue,
social media and marketing and advertising activities, as well as through
market research and perception surveys, to name but a few. This is done
on a daily, weekly and quarterly basis (as required) in order to nurture
the relationships that exist and to seek these stakeholders’ continuous
support in securing long-term business growth.
The Group’s commitment to sustainability is also evidenced in its
management of supplier (especially Utilities providers as utilities is a
material issue) relations through regular, direct engagement, by which
means the Group continuously strives to work together in fostering
healthy relations that are beneficial to all parties involved.
In addition to its proactive communication with all stakeholders through
various channels ranging from traditional media to digital platforms,
O&L also engages with its shareholders through the quarterly List
Trust, O&L Holdings and Olfitra board meetings, as well as its AGM (and
on other occasions when necessary). Namibia Breweries Limited also
has an AGM and various communication channels through which it
interacts with shareholders. The Group’s financial results are also available
on the O&L website and are shared widely through various stakeholder
engagements. In this way, The Group keeps shareholders informed on
its aggressive growth journey and seeks their approval for the major
investment decisions required.
MATERIALITY PROCESSOhlthaver & List must address an array of issues related to the operations
of our businesses and how they impact society over any reporting period.
To ensure that the most important issues are prioritised, a Materiality
Analysis was conducted by appropriate members of senior management
in the year under review. This examined the potential impact of specific
sustainability issues from both stakeholder and Company perspectives.
Level of concern
Effe
ct/I
mp
act
O&L MATERIALITY MATRIX
LOW HIGH
LOW
HIG
H
B
DG
A
C
E
F
A Water
B Energy
C Regional political and economic variables (interest rates/foreign
exchange/supplier security)
D Regulatory environment
E Cost of doing business (incl. taxes, levies, excise duties etc)
F Growth and expansion (potential limitations, including disposable income)
G Skills – shortage and retention
Employee engagement activities aim to align employees with the
Group’s Purpose, Vision and Breakthrough Architecture as well as to
achieve the group vision metric of remaining an employer of choice in
its fields of operation. In caring for its employees, the Group continues
to invest in training and development through talent programmes and
other leadership development initiatives (such as the O&L World, BMS
(Breakthrough Management Skills) and LFP (Leadership Foundation
Programme)). The results of the group’s employee engagement
initiatives − which are not just the prerogative of the human capital
departments but are owned by the leadership throughout the Group −
are evidenced by the fact that following the winning of four consecutive
years of the Deloitte Best Company To Work For accolade, the group has
further secured a Seal of Excellence for Namibia in the Great Place to
Work For Survey, Africa, which is testimony to the Groups continued high
performance as an employer of choice.
Employees have several channels available to them to raise their concerns
and make recommendations, or to obtain feedback from the leadership
teams ranging from workplace forums, to various departmental meetings
and engagement sessions. These sessions keep employees and unions
informed of issues relevant to the critical role that they play in relation
to business performance while also creating a platform for addressing
issues that may arise. Staff have the opportunity to discuss matters of
concern to them − thus ensuring the group continues to live up to its
‘Let’s Talk’ Value. The Tip-offs Anonymous hotline administrated by an
independent service provider, Deloitte (South Africa) also supports the
group’s “Let’s talk value” and its value of ‘We do the right things right’.
The Audit Committee is responsible for embedding a culture of high
ethical standards.
All Directors may seek independent advice at the Company’s expense under
appropriate circumstances in the discharge of their responsibilities. Directors
have access to the expertise of the Company Secretary at all times.
Engagement with its stakeholders beyond the organisation is also a
priority for the O&L Group. As such, the O&L Group actively and regularly
engages with government and regulatory bodies through face-to-face
meetings, telephone calls, and e-mails. Other forms of engagement
include the submission of compliance returns; dialogue to understand
and support the strategy of government {Vision 2030, Harambee
Prosperity Plan, Namibia Equitable Economic Empowerment Framework
(NEEEF) and Namibia Investment Promotion Act (NIPA)}; talks to remain
aligned with the regulations set by the various regulators; and adherence
to these regulations by maintaining open, honest and transparent
relationships. The Group’s sound relations with government are evident in
its commitment and support to the Growth at Home strategy through its
use of local suppliers and investment in job creation; payment of taxation
on time and as per legislation; and decreasing its carbon footprint by
continuously seeking more sustainable energy sources, to name but a
few examples.
As a caring corporate citizen, the Group is not only concerned with
managing its direct and indirect impacts on the spheres within which it
operates, but also in regularly engaging with its communities through
various means − be it the company’s commitment to continuously
adapting to meet the needs of its customers, or through its ongoing
corporate social responsibility and social investment initiatives − activities
that take place on a regular basis wherever the Group operates. In
delivering against its Strategic Area of Focus: ‘Amazing relationships,
enduring impact’, O&L prides itself in being a leader of positive change,
not only within its organisation, but beyond. This is evidenced through
the Group’s commitment to various organisations (such as Team Namibia
and the Namibia Chamber of Commerce and Industry) and industry
bodies (such as the Self-regulating Alcohol Industry Forum and the
Recycle Namibia Forum) in which it plays a significant role through its
leadership and active participation.
ABOUT OHLTHAVER & LIST
28
ABOUT OHLTHAVER & LIST
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F GROWTH AND EXPANSION: LIMITATIONS TO MARKETS (external and
internal to organisation):
Growth and expansion are of great importance in enhancing our
competitive advantages and benefiting the Group’s customers,
particularly in respect to our fishing, brewing, dairy, leisure, and retail
operations. The Group’s supply chain is also dependent on growth,
with limitations to expansion having a material impact. Quotas, distance
from the market, and market saturation in Europe all limit the growth
of our fisheries operations. The local market for breweries is limited
and dependent on national growth, thus requiring a focus on South
Africa and other export markets. Existing production capacities and
low-cost imported dairy products (which erode our local market share)
both limit our ability to achieve economies of scale in the dairy industry
and jeopardise continued local production. The extremely competitive,
limited, and saturated local market currently limits the growth of the
Group’s retail operations, making this sector dependent on national
growth. Social challenges − such as poverty, crime, and land-ownership
issues − also constrain industrial and commercial growth. Across the
Group this material issue is expected to drive increased focus on
innovation to ensure that our products, services and operations remain
relevant to all stakeholders.
G SKILLS - SHORTAGE AND RETENTION (internal to organisation):
Namibia experiences a tremendous shortage in particular skill sets and
these impact all our operations on a general level (i.e., in technical, IT,
risk management, and logistics areas) as well as affecting the availability
of industry-specific technical skills in the brewing, dairy, hospitality, and
fishing sectors.
THE GROUP SUBSCRIBES TO THE FOLLOWING EXTERNALLY DEVELOPED
ECONOMIC, ENVIRONMENTAL AND SOCIAL CHARTERS AND PRINCIPLES:
- The Companies Act (Act 28 of 2004) of Namibia
- The Corporate Governance Code of Namibia (NamCode)
MEMBERSHIPS AND ASSOCIATIONS - Self-Regulating Alcohol Industry Forum (SAIF) - NBL
- Hospitality Association of Namibia (HAN) – NBL & O&L Leisure
- Namibia Manufacturing Association (NMA) – O&L
- Namibia Environmental & Wildlife Society (NEWS) – O&L
- Recycle Namibia Forum (RNF) – O&L
- Namibia Employer Federation (NEF) – O&L
- Team Namibia (TN) – O&L
- Namibia Scientific Society (NSS) – O&L
- Namibia Chamber of Commerce and Industry (NCCI) – O&L
- Dairy Producers Association (DPA) – ND
- Namibia Hake Fishing Association – Hangana
AWARDS RECEIVEDNamibia Breweries was awarded the Gold Award as the Namibia
Manufacturers Association (NMA) Corporate Manufacturer of the Year
2016, and Overall Winner of the NMA Corporate Manufacturer of the Year
2016.
NBL’s Windhoek Lager brand also won its 11th consecutive gold medal
at the Deutsche Landwirtschafts Gesellschaft (DLG Awards). Windhoek
Draught and Urbock also won gold, while Windhoek Light and Tafel
Lager won silver awards at the DLG awards. The international DLG Quality
Evaluation rates beer brands brewed according to the Reinheitsgebot
(“Purity Law”) of 1516 against quality specifications for taste, analytical
and biological standards. NBL was awarded a Long Service Award for 10
years of successful participation in the DLG quality test.
The effectiveness of our management approach to material aspects is
reflected in risk management assessments and the Group is confident
that all material issues have been adequately mitigated.
KEY MATERIAL ASPECTS IDENTIFIED IN THE PROCESS
A WATER (external to organisation):
Drought and water scarcity together constitute a national issue that
impacts all our companies, but especially the beer, soft drink, and dairy
operations. Mitigation of the water risk has received significant attention
as water supply challenges have the potential to limit the Company’s
growth and expansion. Gratifying results were achieved not only in
ensuring business continuity through water-saving initiatives at all our
operations, but also through rigorous stakeholder engagement with
government and other key players. Although the situation has improved
somewhat after a recent good rainy season, the Group believes that the
crisis and related challenges should be viewed as continuous and long
term.
B ENERGY (internal and external to organisation):
Namibia remains a net importer of electricity and despite the recent
medium-term contracts that the national supplier has concluded with
its Southern African counterparts, long-term availability is not secured.
Electricity-supply infrastructure also remains a concern and the probability
of load shedding cannot be excluded. The cost of electricity remains
a concern too, especially in the retail sector where it is a significant
overhead cost. In this regard it should be noted that commercial and
industrial electricity tariffs in the Windhoek area have increased by 115%
over the last six years.
C REGIONAL POLITICAL AND ECONOMIC VARIABLES - interest rates/
foreign exchange/supplier security. (external to organisation):
The somewhat uncertain political situation across southern African, but
especially in South Africa, has rendered the Namibia dollar unstable over
the last two reporting periods and this has had mixed impacts on the
cost of imported raw and packaging materials from outside of the region
and the exports of fish products. In addition, the region is registering
lacklustre economic growth which, coupled with the government’s
recent payment record to its suppliers, has added to our concerns.
D REGULATORY ENVIRONMENT (external to organisation):
While Namibia enjoys political stability alongside a healthy regulatory
environment, certain of its policy frameworks do have impacts on
the Group’s operations, be these financial or from a compliance point
of view. In addition to complying with existing legislation, the Group
also actively participates in dialogue around planned legislation. The
draft of the proposed Namibia Equitable Economic Empowerment
Framework (NEEEF) is a case in point, whereby the Group continues
to make recommendations to policymakers to ensure that Namibia’s
transformation objectives are met in a responsible and sustainable
manner. Emerging legislation around investments, procurement, and
deed transfers have raised additional concerns to the Group, necessitating
further engagement with regulators.
E COST OF DOING BUSINESS (incl. taxes, levies, duties etc.) (external to
organisation):
The Group’s operations − as well as all role players in the supply chain
− are affected to a greater or lesser extent by various uncontrollable
costs, such as training levies, fishing industry levies, export duties, local
government rates and taxes, environmental levies, and the costs of
utilities (such as water, electricity, and effluent tariffs). Being reliant on
single suppliers (including parastatals) results in non-competitive pricing
when compared against imported products, influencing the costs of
doing business in Namibia.
ABOUT OHLTHAVER & LIST
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ABOUT OHLTHAVER & LIST
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SUPPLY CHAIN FRAMEWORKWithin the various operating companies (OpCos) of the O&L Group of
Companies, supply chain management (SCM) encompasses the planning
and management of all activities pertaining to sourcing and procurement,
conversion of raw materials into finished goods, and logistics. Critically,
it also includes coordination and collaboration with channel partners:
suppliers, intermediaries, third-party service providers, and customers.
In essence, SCM integrates supply and demand management within and
across our companies and their stakeholders. Within the Group, SCM is
seen as an integrating function whose primary responsibility is linking
the major business functions and business processes within the relevant
OpCos and across their relevant value chains. The management of the
supply chain includes all of the logistics-management activities noted
above as well as manufacturing operations; SCM drives coordination of
processes and activities with and across marketing, sales, product design,
finance, and information technology.
In line with O&L’s value system and strategic intent, the management
of the supply chain is conducted under the following framework:
- Critical information systems relevant to the management of the supply
chain are maintained by the O&L OpCos. These might include: enterprise
resource planning (ERP)/material requirements planning (MRP)
solutions; forecasting and planning tools such as Futurmaster and
Forecast Pro; warehouse management systems; and routing and
scheduling systems.
Should service providers be able to provide their own solutions, the
ownership of the data vests within the O&L OpCos to enable the
flexibility necessary to engage in regular request for quotation (RFQ)/
request for information (RFI) or tender processes.
- Use of service providers: in order to manage supply chains effectively
and efficiently, we encourage the use of specialised service providers
across our operations. The identification of potential service providers
lies at the discretion of the relevant OpCo but should be guided by the
following criteria:
- Cost efficiency;
- Innovation;
- Sustainability (focused on the sustainable use of natural, human, and
financial resources);
- ‘Local content’ and the empowerment of SMEs; and
- Reliability and anticipated service levels.
OpCos are obliged to manage service providers by means of signed
contracts and service level agreements, as well as through regular and
frequent service reviews.
Contractual engagements with service providers is limited to three years,
thereafter the provision of services is tendered/offered in the open
market.
The management of supply chain functions is conducted in line with the
ISO 9001:2008 quality standard.
Material impacts on the Group’s supply chain are covered under the
section ‘Materiality Process’.
VAST SPACES
HOMEGROWN BARLEY
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The year under review can be described as a highly volatile and challenging
period. On the global front, stagnant global trade, subdued investment,
and heightened policy uncertainty marked another difficult year for the
world economy. A subdued recovery is expected for 2018, with receding
obstacles to activity in commodity exporters and solid domestic demand
in commodity importers. Weak investment is weighing on medium-term
prospects across many emerging markets and developing economies
(EMDEs). Although fiscal stimulus in major economies, if implemented, may
boost global growth above expectations, risks to growth forecasts remain
tilted to the downside. (2017 World Bank Report on Global Economic Prospects)
On the local front, it is benign to state that the Namibian economy is
emerging from a perfect storm. The adverse impact of the commodity
price crash, a slowing global economy and low growth in large neighbouring
economies was exacerbated by the continuous drought and water crisis
impacting agricultural production and the construction industry, amongst
others - all contributing to an extremely tough and challenging financial
year. Economic growth has slowed in 2016 to an estimated 1.3 percent.
Despite these developments, and the slow economic recovery in Namibia’s
main trading partners, the weak growth in commodity prices and increasing
uncertainty in the global geopolitical environment, the medium-term
prospects for our economy have started to look better. Growth is projected
to be 2.5 percent in the coming financial year and average approximately 3.5
percent over the Medium-term Expenditure Framework (MTEF). (Republic of
Namibia - Ministry of Finance, 2017/18 Budget Statement)
Despite the challenging economic environment, we are optimistic that the
global activity is firming broadly as expected. Furthermore, in Namibia, we
are privileged to operate in an environment where Government and the
Private Sector openly discuss matters of strategic importance, seek solutions
to challenges, and work together to enhance the business climate so as to
shape a better future.
The O&L Group strategy - supported by a phenomenally strong, passionate
and breakthrough leadership team that drives its execution, has once
again contributed to a solid performance during the year under review
- testament to our breakthrough methodology. The Group’s operating
profit after fair value adjustments declined from N$948.9 million in 2016
to N$874.8 million in 2017. The Group has achieved consistent profitability
for the past decade, growing from an EBIT of N$266 million in 2007 to
N$723.8 million in 2017.
Our Purpose, “Creating a future, enhancing life” inspires our vision – to
become the most progressive and inspiring company - through reaching
a N$2 billion earnings before interest and tax (EBIT) target; reducing our
carbon footprint by 20%; remaining an Employer of Choice, and creating
4 000 additional job opportunities by 2019.
Our people – totaling 6 100 employees, our most important and powerful
asset to transform our business - remained relentlessly committed in
our pursuit of contributing to, and living, our purpose - which is the
backbone of our existence. In fact, had it not been for our hunger to
accomplish our dreams by taking responsibility for ourselves and each
other, we would not have come this far. The O&L Leadership Journey -
whereby all the leadership dimensions are nurtured and developed so
as to enhance breakthrough performance that delivers breakthrough
results - has inspired and enabled us to create an environment where
breakthrough results are supported by focusing on purposefulness,
a risk-free environment, and ownership. Our participation in the Gap
Organisational Alignment Diagnostic for the second year – with a 91%
response rate - has certainly step-changed our leadership resulting in the
individual being elevated from “my ownership” to “owning the whole”.
Our success not only depends on the expertise, talent and professional
development of our people. We recognize that to get the best out of
our people and help them thrive in their work environment, it is the work
experience and satisfaction of our employees that is essential.
JOINT MESSAGE FROM THE EXECUTIVE CHAIRMAN AND THE CEO
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On behalf of the O&L Board of Directors, we would like to express our
heartfelt appreciation for the leadership, dedication and integrity of
our employees – our people. We also extend our sincere gratitude to
our Board of Directors for their leadership, valuable advice, trust and
support. The Government of the Republic of Namibia, our shareholders
and investors, industry partners, associates, customers and consumers
– thank you for believing in us, our people, products, brands and
technologies.
Sven Thieme Peter Grüttemeyer
Executive Chairman Chief Executive Officer
Hence, the successful launch and rollout of the new employee trust
survey and being officially certified as a Great Place to Work in Africa, is
a step in the right direction as we become a more agile and empowered
organization, creating capable and breakthrough leaders.
Some of the proud moments during the year under review includes
Weathermen & Co. obtaining the MTC and FNB Namibia contracts in
an extremely competitive environment; NBL’s continued upward trend
with volumes to South Africa achieving 38% above plan; our investment
property portfolio, Broll’s completion of 77 on Independence mixed-
use development set; Kraatz’ appointment as Namibian agent for
Hitachi Construction - world-renowned for excellence in hydraulics,
manufacturing and repairs, within the mining and construction industries.
Furthermore, OLC Energy’s setting up of the first large solar energy
plant as an independent power producer in Arandis; supporting the
Intelligence Support Against Poaching (ISAP) through donating the Piper
Super Cub plane to strengthen the fight against poaching; developing
our own Sustainability Index to ensure each and every one contributes
to our Vision 2019 carbon footprint target; Hangana Seafood taking over
ownership of the Luderitz Abalone Farm, now known as Hangana Abalone
Farm; Pick n Pay Namibia continuing to roll out its expansion and revamp
programme despite the challenging economic climate, opening the new
B1 City Store and revamping the Katutura and Katima Mulilo stores to
enhance the shoppers experience; and Namibia Dairies setting up the
Farmers Development Programme aimed at diversifying the Namibian
farming community, to name but a few, has greatly impacted on not
only the Group, but the country as a whole. These are but just some of
the achievements that are great examples of how we can surpass the
challenges around us by working together and standing for the success
and future sustainability of our country.
We recognize that our biggest opportunity lies in leveraging off the
benefits of the digital explosion as an enabler in expanding the impact
of the O&L Person; ensuring that the contribution of our inspired people
who passionately live our purpose within and beyond the business,
creates a ripple effect; where people are inspired to achieve the
unimaginable; driving further value addition; prompting the delivery of
new innovations to enhance consumer experiences; and impacting the
whole. Further to that, ensuring that organization-wide breakthrough;
with people who think outside the box and work interdependently,
inspires and contributes to continuous breakthrough within and beyond
the organization.
We are proud, yet humbled, of our contributions to make a difference in
the lives of the communities within which we operate as they reflect the
passion, dedication and hard work of our people and stakeholders alike.
True to our purpose, the Group invested in excess of N$12.3 million in
community initiatives during the period under review, focusing primarily
on education and skills development as key enablers of community
upliftment. Further to that, we recognize the impact our activities have
on the environment, and how these activities can contribute to climate
change, and as such we are committed to be ambassadors for sustainability,
committed to reduce our carbon footprint with 20% by 2019.
Despite the challenging environment experienced during the year
under review, we remain relentless in our pursuit to passionately live our
Purpose, Vision and Values and staying focused on the journey to our 100
Year legacy that will be celebrated in 2019.
We recognize that to get the best out of our people and help them thrive in their work environment, it is the work
experience and satisfaction of our employees that is essential.
“
“
CARBON FOOTPRINTREDUCTION
SOLAR ENERGY PROVIDED
MEGAWATTHOURS
DRINKiQ
PEOPLE TRAINED
TAP STUDENTSSINCE 2008
MIL
CSI
SPENT
LOCAL PROCUREMENT SPENDING
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We reinforced our position in the craft-beer market by working with our
new partner craft breweries, Stellenbrau and Soweto Gold, on product
packaging renovations and format extensions that are better aligned
to consumer needs. Our own craft-beer brand, Camelthorn, was re-
launched in Namibia and South Africa in July 2017. The success of NBL’s
partnership with Heineken South Africa was also a major highlight for
2017.
We recognize the challenges facing Namibia and NBL continues to
leverage its scale and expertise to reduce its environmental impacts while
increasing its positive social outreach. In light of the severe drought that
has plagued Namibia in recent years, NBL’s investments in water security
and water-saving initiatives are a shining example of this commitment.
In addition to ongoing wastewater recycling in the brewing and
packaging plants, NBL drilled three additional boreholes on its premises
in September 2016, bringing our total to five on-site boreholes. These
reduce NBL’s dependency on public water sources since the boreholes
are not linked to the aquifer supplying the City of Windhoek.
We will continue to leverage our portfolio of premium beers; capitalize
on new opportunities in the growing craft-beer segment; and respond to
consumers’ ever-changing needs. We remain committed to the Group’s
Purpose and to taking our breakthrough culture to a new level. This will
ensure that NBL maintains its trajectory towards growth and prosperity
and achieving the Group’s Vision 2019.
FRESH PRODUCENAMIBIA DAIRIES (PROPRIETARY) LIMITED
The vision of Namibia Dairies is to be recognized as a vertically-integrated,
independent dairy, servicing the value chain from farm to fridge.
During the year under review, Namibia Dairies focused on four critical
success factors that contribute to achieving its business goals:
- Our people
- Sustainability;
- Service excellence; and
- Financial growth.
Together, Namibia Dairies and Windhoek Schlachterei delivered revenue
(after discounts and rebates) of N$583 million for the reporting year,
compared with N$570 million during the 2016 financial year. The year-
on-year increase in turnover of 2% is mainly due to an inflationary price
increase on the one side, while sales volumes decreased by 4% on the
other. Sales volumes of fresh milk and Oshikandela drinking yoghurt have
decreased significantly due to increasing import competition, while the
spending power of consumers has been dramatically reduced as a result
of the recession in Namibia.
Total operations generated an operating profit of N$13.9 million in the
2017 financial year compared to N$36.1 million in the 2016 financial year.
The continued focus on the QDVP4 (quality, distribution, visibility, price,
promotion, persuasion and partnerships) Sales Excellence Programme
ensured benefits such as high-quality sales execution, improved sales
performance, improved merchandising standards, and greater consumer
acceptance and recognition.
The !Aimab Superfarm now houses 1,300 cows in milk. The total herd
comprises just over 2,700 animals and produces about 60% of Namibia
Dairies’ raw milk requirements, which in turn meets about 50% of
Namibia’s fresh and UHT milk demand. The high cost of production,
driven by very high feeding costs, remains the biggest challenge to
the !Aimab Superfarm and is the main reason that it remains in a small-
operating-loss position for the year ended 30 June 2017.
BEER AND SOFT DRINKSNAMIBIA BREWERIES LIMITED
Namibia Breweries Limited (NBL) delivered another solid financial
performance in 2017, with operating profit of N$608 million and revenue
of N$2.7 billion, growth of 12.4% and 11.6% respectively. This was achieved
despite a particularly challenging year, which was characterised by severe
drought, unpredictable exchange rates, and rapidly shifting consumer
tastes. In addition, consumer spending contracted in the first quarter
of 2017, resulting in decreased demand for private-sector products and
services. Our performance therefore demonstrates NBL’s resilience and
ability to adapt to changes within our operating environment.
Additional risks to the domestic outlook over the period under review
included: water restrictions due to the drought, the increasing cost of
electricity and municipal services, a weakening exchange rate, rising
interest rates, and increased competition. Despite this, NBL delivered
strong financial results that defied expectations. To succeed in difficult
times, we continue to work hard to ensure that our people’s individual
purposes connect with what we want to achieve as a business. If our
people are strongly aligned with our business goals and have a strong
passion for what we do, we can more easily overcome obstacles and
generate breakthrough thinking that carries our Purpose − ‘Creating a
future, enhancing life’ − into our brands, people practices, and business
initiatives.
Globally, NBL differentiates its export markets as either focus or trading
markets. Focus markets include Tanzania, Mozambique, Zambia, and
Botswana − countries that demonstrate high growth potential and are
flagged for in-market presence and investment. Tanzania remains the
biggest export market, with volumes doubling year-on-year for the
fourth consecutive year. Mozambique remains a challenging market at
present so it will be exciting to see what the future can hold for this
market.
Trading markets include, among others, the United Kingdom, Germany,
and Australia. In these countries, demand for NBL’s products is driven
by expat communities and increasing tourism to Namibia. There is a
commitment to drive presence in these countries as part of our growth
strategy, including, for example, expanding NBL’s reach in the United
States in order to tap into the growing prominence of craft beers
globally. During the year under review, a decision was taken to exit China
as this is not a feasible market currently due to the fiercely competitive
environment.
In the current year, our brand strategy was reviewed in order to focus on
providing consumers with a greater choice of beverages. We launched
our Tafel Lite beer − with 27% less carbohydrate content than Tafel Lager
− as a health-conscious alternative, in line with worldwide consumer
trends.
Innovation in the non-alcoholic category is specifically aimed at supporting
the Group’s commitment to responsible beverage consumption and
diversification. To this end, our new soft drink, Code, offers an additional
non-alcoholic alternative to consumers who are loyal to the Group
product portfolio.
King Lager continues to play a key role in the portfolio. As this home-
grown beer has not yet met market expectations, however, we invested
in various marketing strategies during the year to grow volumes. This
strategy in turn supports the local barley industry, with the ultimate goal
of creating sustainable employment in this business in Namibia. King
Lager therefore remains a purpose-driven initiative for NBL and despite
challenges we are committed to its long-term success.
Globally, the ‘premiumisation’ trend continues, with premium and super
premium beer segments delivering growth ahead of mainstream beer
categories. This includes specialty and craft beers as drivers of choice.
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This, together with the new planned factory will allow Hangana to increase
employment as well as provide more stability through diversification.
Extracting the most value out of catches:
Hangana is currently in the process of planning a new factory, which
will give the company more flexibility in terms of producing a variety of
different products. The estimated cost of the new factory will be N$285
million and it will be owned and operated by a joint venture (JV) between
Hangana Seafood and the Merlus Group. Current indications are that the
JV could potentially include new rights-holder groups, which will then
effectively be part-owners of the JV and will help to consolidate volumes
delivered for processing at the factory.
Local distribution:
With the objective of ensuring that more Namibians enjoy the benefit of
our marine resources, Hangana has decided to invest in developing its
own fish shop to expand its reach and improve the availability of Hangana
products beyond their current distribution channels. This investment will
total N$3.2 million and provide 12 additional employment opportunities.
The fish shop will have two sections, one for retail clients and one for
the general public. Products sold will also include those from Namibia
Breweries, Namibia Dairies and Windhoek Schlachterei.
RETAILMODEL PICK N PAY (A DIVISION OF WUM PROPERTIES (PROPRIETARY)
LIMITED)
As the Group’s Retail Division, Pick n Pay Namibia has had a tumultuous
year as it battled the headwinds from a challenging economy and the
costs linked to its continued expansion and upgrade strategy − while
still meeting the needs of its customers, who are currently feeling the
pressure of the economic slowdown.
Despite these challenges, the division has nevertheless delivered a strong
trade performance, driven by our continued focus on delivering a world-
class shopping experience to our customers in all the towns and cities
where we have a presence. Putting our customers first − by offering the
best ranges, quality products, and great service while delivering value
through competitive pricing − has enabled Pick n Pay Namibia to remain
a leader in the local retail market.
This focus and determination has resulted in the division delivering very
strong sales growth at over 13% for the year to N$1.98 billion (compared
to 15% in FY16) in a very challenging market. Operating profits of N$8.8
million decreased by 48.8% from N$17.2 million recorded in F16.
Our ever-present focus on increasing efficiencies and reducing costs
has limited like-on-like expense growth to an inflation-busting 4%, while
our shrinkage figures are at an absolute world-class level of 0.46% of
turnover (down from 0.6% in the previous year) while total wastage also
stood at a respectable 0.74% (down slightly from 0.8% over the previous
reporting period). Furthermore, even in these difficult times, we have
been successful to some extent in reducing our overall stockholding
without a negative impact on sales, thereby releasing much-needed cash.
The combination of an aggressive competitive environment with sticky
national economic growth has subdued performance in a number
of our larger stores, including Oshakati, Walvis Bay, Swakopmund, and
most importantly Wernhil – all of which have seen reduced profitability
for the year under review. In addition, some of the younger stores have
not yet achieved their planned levels of profitability, including Outapi,
Grootfontein, B1 City and Oshikango, thereby putting further pressure
on the Group’s profit result.
Positive results from the technical quality audits confirm Namibia Dairies’
commitment to quality management and food-safety systems, while the
business continued to optimise systems and processes − thus enhancing
effectiveness and efficiency.
WINDHOEK SCHLACHTEREI (PROPRIETARY) LIMITED
In its seventh year as a component of Namibia Dairies, Windhoek
Schlachterei again showed solid growth and continues to contribute
positively to the operating profit of Namibia Dairies. Like-for-like sales
volumes in Namibia grew by 19% on the previous reporting period, driven
by a strong increase in volumes delivered by our King Polony brand, as
well as fresh cuts.
FISHINGHANGANA SEAFOOD (PROPRIETARY) LIMITED
At Hangana, we focus on delivering healthy value-added seafood offerings
to local and international markets in a sustainable manner and we had a
reasonably good year despite facing various challenges. Turnover increased
slightly to N$549.3 million (2016: N$546.9 million), while operating profit
unfortunately decreased by 25.6% to N$50.3 million (2016: N$67.6 million).
The increase in turnover was mainly a result of increased volumes sold
at better foreign currency prices, yet the increase was partially reduced
by the stronger local currency (when compared to the prior reporting
period). The staggered allocation of quotas throughout the year caused
significant difficulties in scheduling our operations so that the factory
continued to be supplied with raw material; therefore management
had to source expensive raw material to keep the factory running on
all shifts. This put pressure on our margins and resulted in the decrease
in profit compared to the previous year. Given the current economic
climate, however, the company performed well on three O&L vision
metrics, namely the ‘Great Place to Work®’ survey, creating additional
employment, and reducing its carbon footprint.
INVESTMENTS AND FUTURE STRATEGIES:
The company has identified the following five strategic initiatives as critical
to its current strategic planning cycle. Their contributions will benefit all
stakeholders, including government, shareholders, employees, and the
Namibian public:
Abalone farming:
Hangana officially acquired Lüderitz Abalone Farm on 31 March 2017
at a cost of N$13.9 million, rescuing the operation and securing the
livelihoods of 23 employees. The immediate target is to increase the
farm’s capacity from the current 24 tonnes of live animals on hand to 150
tonnes of live animals.
Developing the Consortium and Kuiseb properties into a service hub:
The new finger jetty for Consortium Fisheries Limited has been completed,
and is now in operation. The completion of the finger jetty for Kuiseb Fish
Products (Proprietary) Limited is planned for October 2017. The jetties
will amount to an investment of N$35 million and together with the
envisaged new factory will add tremendous value to Namibia’s fishing
industry as the service hub they comprise will provide much-needed
services to other industry players. The service hub will mainly provide
support to foreign flag vessels, including stevedoring, fuelling, berthing
and clearing, and forwarding and clearing services.
Expanding our trading business globally:
In focusing on the expansion of its global trading business, Hangana
has opened a trading office in South Africa to further cement
relationships with our customers there and to create additional
trading opportunities. Furthermore, over the past 24 months
Hangana has significantly increased its imports of raw material from
both South Africa and South America for value addition in Namibia.
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PROPERTIESBROLL & LIST PROPERTY MANAGEMENT (NAMIBIA) (PROPRIETARY)
LIMITED
CENTRAL PROPERTIES (PROPRIETARY) LIMITED
O&L PROPERTIES (A DIVISION OF WUM PROPERTIES (PROPRIETARY)
LIMITED
WERNHIL PARK (PROPRIETARY) LIMITED
Broll Namibia − the Property Management Company of the O&L
Investment Portfolio and a subsidiary of the O&L Group – has once again
seen a solid performance for the period under review, increasing its
EBIT by 173% to N$4.1 million and has grown its total portfolio under
management from N$3.6 billion to N$3.8 billion as at 30 June 2017.
The total portfolio generated revenue (excluding deferred rentals) of
N$157 million in the year under review (2016: N$150 million), with an
operational EBIT of N$ 125 million (2016: N$115 million). Total EBIT of N$
203 million (2016: N$ 347 million), which includes fair value gains of N$ 78
million (2016: N$232 million).
The period under review has been a challenging year for the Investment
Property Portfolio. The reduced growth in value is a clear reflection of
the overall tough economic conditions faced by most sectors in Namibia
since 2016. These conditions have severely impacted the disposable
income of our primary shopper base which has in turn contributed to
reduced retailer turnovers, lower trading densities and overall foot traffic.
In addition to the poor economic growth, the growth in competitive
retail destinations over the past 3 (three) years has resulted in substantial
alternative for shoppers and retailers within mostly the central region
of Namibia, but also to some extent at Namibia’s central coastal areas.
Together with the fact that the Angolan market is yet to recover, this
has impacted the portfolio’s operational profitability and with this, the
growth in fair value gains. Valuation gains for the financial period under
review were thus substantially lower than prior years, amounting to N$ 78
million (N$ 232 million: 2016). Although the overall financial performance
has seen a downward trend, which was to be expected given the current
economic challenges, the overall fundamentals of the portfolio remain
sound and are poised for growth once economic recovery has been
achieved.
The flagship of the Investment Property Portfolio remains Wernhil Park
Shopping Centre. Valued at over N$ 1.1 billion at the end of the financial
year, Wernhil Park is still a popular shopping destination within the
Windhoek retail landscape. At year-end, the vacancy rate at Wernhil Park
was at a mere 0.3% (0.8%: 2016), which is the lowest vacancy rate for any
regional mall currently trading in Namibia. Foot traffic, although lower
than in the previous year, remains above 1 million feet on average per
month while trading densities remain robust compared to other similar
malls both in Namibia as well as South Africa.
All critical requirements to ensure the commencement of Wernhil
Park Phase 4 were met by the end of the financial year with this highly
anticipated development to commence early in July 2017. The extension
will see the current centre grow from 36,600m2 to over 55,000m2 on
completion. The strong demand for the extension to Wernhil Park is
evident from the fact that over 70% was pre-let before the end of the
financial year, allowing for the securing of retailers for the remainder of
the rental space to take place on or before the completion date, being 1
May 2019. The extension has secured several prominent national brands,
including Checkers, Food Lovers Market, Dischem, the Foschini Group,
Hi-Fi Corporation and Mugg & Bean to name a few.
Alexander Forbes House, with its strategic location, has seen an
exceptional year-on-year value growth with close to 12% to prior year.
These have been offset, however, by the success of our recently opened
stores, including Ondangwa, Mega Centre, Tsumeb, and Okongo; the
refurbished Katima Mulilo store; and our flagship premium stores at Auas
Valley and Oshana − all of which have (to a greater or lesser extent) exceeded
their profit performance compared to the previous financial year.
During the year under review we have invested N$51 million in upgrading
our existing stores and increasing our footprint. This included the
refurbishment and expansion of our Katima Mulilo and Katutura stores,
the relocation of our Oshikango store to a better site, and the opening
of our new B1 City store in Windhoek. All of these developments are
performing according to plan and in line with expectations, apart from
that at Katutura − which is awaiting the completion of the mall upgrade
by the landlord.
In March 2017 we had to close our Otjiwarongo store due to the mall
construction activity planned by the landlord. We aim to open this store
again in the near future, as soon as construction is completed. This will
bring our national footprint to 23 separate sites.
As in prior years, the division pursues innovative activities to enhance the
offering to our customers, including the ongoing rollout of our new POS
system country-wide; the launch of the ticketing platform Webtickets at
all our stores; and introducing new ways of working and processes across
our stores nationally to focus on in-store execution. From a customer
perspective, exciting and innovative promotions were offered, including
our very successful Heroes Campaign, our Johnny-Dollar Campaign,
the ongoing ‘win-a-ride’ competition, late night shopping events, and
category-based themed promotions. Pick n Pay Namibia continues to
advertise aggressively to drive top-line sales growth.
Our focus on fresh offerings once more delivered positive results whereby
our service-area growth for the year consistently exceeded overall store
growth (albeit below plan). Margin control has been a challenge at times
during the year as our customers continue to face household income
challenges, putting pressure on our costings and on maintaining margins
effectively.
A strong increase in customer counts (7%) and an inflation adjusted
increase in basket sizes (6%) confirm our good overall sales performance
while also highlighting further opportunities for growth through
expansion and increased trading activity.
Our continued investment in our workforce through training,
development, and leadership growth has provided the backbone to
our positive performance: we have promoted 16 of our colleagues into
management positions, as well as one to a regional manager post, while
1,564 employee-training interventions were held during the year, of
which 217 consisted of various leadership training events. This once again
demonstrates both the need and the benefit of ongoing investment in
maximising the potential of our employees and shows our continued
ability to develop leadership talent internally.
We continue to enjoy the support of the communities we operate in
through our corporate social investment (CSI) initiatives, including our
soup kitchens and school-support programmes to name but two, while
our ambition to increase purchases from Namibian manufacturers and
suppliers supports and adds value to our local economy.
As economic and market challenges continue, delivering the best
value and shopping experience to our customers and driving further
efficiencies in a sustainable manner throughout the business will remain
our priorities for the foreseeable future.
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O&L Energy has established a network of international and local business
partners at the same time as it is intensifying its marketing activities
in Namibia and South Africa. Cronimet Mining Power Solutions GmbH,
a German engineering company, was brought on board as a strategic
partner for large-scale solar power plants. O&L Energy has also secured
a partnership with a Global leading manufacturer of inverters, with
agencies for technical services and distribution in Namibia.
Together with Namibia Dairies and an external engineering partner, O&L
Energy is also developing the first biogas plant in Namibia at the !Aimab
Superfarm in Mariental. This plant will be fully operational during the
second half of 2017.
Organic Energy Solutions − a subsidiary of O&L Energy − has established
a bush-to-energy business with the aim of harvesting invader bush
species in Namibia for the generation of sustainable energy for industrial
purposes. Organic Energy Solutions is a pioneer in bush-harvesting and
processing methods and during the year under review it commenced
the large-scale supply of woodchips to Namibia Breweries Limited for
its newly installed (first of its kind in Namibia) biomass boiler, with this
development being the single biggest contributor to O&L’s carbon
footprint-reduction achievements to date. One challenge has been
customer demand for a cleaner fuel product; for this reason we have
invested in mobile screening machinery that enables us to remove a
significant portion of the fine dust and sand previously collect along with
the Namibian encroacher bush material.
In FY18, the focus will be on volume growth by developing further
customers and/or applications for our encroacher bush product.
LEISUREO&L LEISURE (PROPRIETARY) LIMITED
The year under review was the first year in which all four properties making
up this portfolio were operational, with a combined total of 293 rooms
and the successful opening of the Chobe Water Villas being the highlight.
Trading during the first half of the financial year was exhilarating in most
of our customer segments, whilst trading in the second half of the year
was very subdued, with the domestic and regional segments performing
well below expectations as a result of the regional economic slowdown.
The Central European source market’s contribution also slowed down
during the second half of the financial year. This once again reveals the
impact of too much reliance on the seasonal Central European market
and demonstrates the need for ‘Destination Namibia’ to diversify its
source markets.
The boutique 16-room Chobe Water Villas is located at the eastern
tip of the famous Caprivi Strip, in the Zambezi Region of northeast
Namibia. This exclusive and intimate wildlife lodge opened for business
at the beginning of July 2016. The lodge is situated within the 150
km² Kasika Conservancy, in a secluded position directly on the banks
of the Chobe River and near to the town of Kasane in Botswana.
This siting affords visitors unobstructed views toward the world-
renowned Chobe National Park and the lodge also overlooks Kasikili
(Sedudu) Island, which boasts a phenomenal density of wildlife species:
elephant, lion, buffalo, hippo, crocodile, eight species of antelope and
over 460 species of birds.
The year under review also saw the following achievements:
- Total revenues have grown by 33.1% to N$187.4 million.
- Mokuti Etosha Lodge increased its occupancy from 59.5% in the
previous year to 63.4%, while also increasing its average room rate
from N$924 in FY16 to N$1 006.
This was brought about due to not only substantial demand for the
property, but also because of strategic anchor tenants expressing their
interest to extend for a further long-term period, as well as some vital
developments being planned for FY18. These developments will include
the expansion of the parkade as well as important changes to the retail
area making same more attractive and accessible.
Standard Bank Centre, which was unfortunately impacted by the decision
of Standard Bank Namibia to build their own head office and to exit the
Standard Bank Centre in 2019, had caused a negative year-on-year value
growth although a further extension of the Standard Bank Namibia lease
agreement was secured up to the end of 2019. Substantial changes are in
the planning stages for the upper retail area of Town Square, which over
the past years has seen significant challenges when it comes to retaining
retailers and ensuring strong foot traffic.
The completion of the 77 on Independence development during
November 2016 was a major milestone. With 164 residential units and
approximately 1,300 sqm of retail area, this development will contribute
significantly to the revitalization of the Windhoek CBD area. Transfer of
over 85% of the residential units was achieved by the end of the financial
year, while several high quality and value adding retail tenants have been
secured for the retail area. In addition to this, the critical link between
Independence Ave. and the Old Breweries complex was restored allowing
feet to pass through from either side in future. Although the residential
units will be sold by way of sectional title, the retail area will be retained.
WUM Properties (Pty) Ltd is currently a 60% owner of the retail area.
Year-on-year value growth for O&L’s core Investment Property Portfolio −
which includes Wernhil Park, Alexander Forbes House, and the Standard
Bank Centre – was just under 5% (2016: 14.6%), with operational earnings
before interest and tax (EBIT) increasing by 8% year-on-year.
ENERGYO&L ENERGY (PROPRIETARY) LIMITED
The strategic focus for O&L Energy continues to lie in project development,
project management, engineering, procurement, and construction.
Further core activities involve the operation and maintenance of:
- Medium- to large-scale solar power systems;
- Large-scale solar heating systems; and
- Bioenergy plants.
During the year under review, O&L Energy, together with its partner
Cronimet Mining Power Solutions, secured its first three solar power
projects on a ‘build-own-operate’ basis. The first contract was awarded by
the regional electricity distributer Erongo RED for a 3MW plant at Arandis,
which was constructed successfully and completed on schedule in June
2017. The second solar power plant is being developed in partnership
with the Okakarara Town Council, making this the first public-private
partnership in Namibia’s energy sector. O&L Energy was also awarded a
tender from the regional electricity distributer Cenored for a 5MW solar
power plant in Tsumeb. With these three projects − and several more
planned developments − O&L Energy has established itself as a leading
independent power producer in Namibia.
Within the O&L Group, in addition to the solar plant for NBL that has
been running successfully since 2013, O&L Energy will also implement
solar power plants for the Mokuti Etosha and Midgard Country Estate
lodges in the coming financial year. O&L Energy has also continued to
implement energy-saving solutions and energy-auditing activities across
O&L companies while expanding these services to customers outside the
O&L Group. We also continued with our Energy-Saving Lights Programme
for various clients.
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- Supporting and sustaining the current client base and recruiting new
clients;
- Maintaining and building a diversified Namibian supplier base; and
- Developing an inspirational working environment in which employees
can flourish and live their passion.
We are excited to embrace the future with innovative talent and a
passionate team that can attract new clients and create new opportunities
for us in developing fresh, strategic creative work that leaves lasting
impressions in the Namibian market.
ENGINEERINGKRAATZ MARINE (PROPRIETARY) LIMITED
The economic slowdown and tough market conditions have had a severe
impact on Kraatz Marine’s revenue and margin lines. Furthermore, low oil
and uranium prices affected 80% of our revenue stream. Revenue for the
financial period under review decreased from N$86.1 million in 2016 to
N$77.1 million in 2017. All indications are that steel supply into Namibia
has seen a reduction of about 40%; as a result, a strategic decision was
made to close Kraatz Steel in FY17 due to consistently low revenue
numbers over the past three years.
Reduction of costs and a relentless focus on sales and business
development, coupled with further diversification, are thus key to our
future growth prospects as well as to ensuring that Kraatz Marine gains
access to a floating dock.
Despite the challenging environment, our people, brand and long-lasting
client relationships have contributed to the further diversification of our
business into the heavy-mining equipment sector with the signing of our
important agreement with Hitachi Construction, through which Kraatz
became their Namibian agent. In addition to that, we have completed
another Syncrolift rehabilitation project and have experienced good
growth from the new uranium mine, Husab, while we also contributed to
the completion of the Group’s first large solar plant installation, at Arandis.
A challenge in our industry continues to be its dearth of skilled personnel.
To address this skills shortage, Kraatz is committed to developing young
talent through its apprenticeship programme with the Namibian Institute
of Mining and Technology (NIMT) and its engineering programme, through
the Namibia University of Science and Technology (NUST). Students from
both these institutions are hosted as interns at Kraatz, where they are
exposed to industry best practice. These endeavours are complemented
by the ‘Learn to Weld’ programme now offered by Kraatz.
Trading conditions in 2018 will no doubt remain tough but the business is
well positioned and confident that it is poised to capitalise on a number
of significant opportunities in times to come.
CENTRALIZED SERVICES O&L CENTRE
The O&L Centre comprises two divisions: O&L Corporate, which includes
the Group Leadership Team that leads group strategy, and the Centre of
Excellence, which renders specialist services to all operations in the O&L
Group.
These directly address the Group’s Vision Metrics and support the Group
Sustainability Agenda through:
- People strategy;
- CO2 savings;
- Corporate social investment (CSI) initiatives and spend; and
- Capital spend
Given the difficult economic climate, the O&L Centre managed to save on
budget and was in a position to hand a credit of N$10.5 million back to
the O&L operating companies.
The following are some of the highlights of the year under review:
- Centralising the Group employee relations function;
- Midgard Country Estate experienced a slight decrease in occupancy,
mainly due to reduced bookings from its primary conferencing
segment as a result of a decline in government and corporate activities
of this nature there: occupancies declined from 46.2% in the previous
year to 45.7%. This also resulted in a slight decrease in the average
room rate achieved, from N$782 to N$779.
- The Strand Hotel Swakopmund had its first full trading year in this
reporting period and had a steady occupancy rate compared against
the previous year (2016: 64.2%), while the average room rate increased
from N$1 439 in 2016 to N$1 546.
- Chobe Water Villas had a difficult first trading year, struggling to
penetrate the competitive high-end market in the Chobe destination
area, with occupancies well below those anticipated. Revenue for the
year was N$7.4 million and occupancy was at 23.7%.
- A highlight for the year in review in relation to our 2019 Strategic Focus
Areas: ‘Everyone purposefully producing breakthrough everywhere’
is the development of our pool of future leaders. This commitment
has been enhanced with the Talent Attraction Programme intakes, the
launch of the understudies’ development initiatives, and the signing of
memoranda of understanding for our internship programmes with the
University of Namibia (UNAM) and the Namibia University of Science
and Technology (NUST).
- In relation to our ‘Amazing experiences, enduring impact’ 2019 Strategic
Area of Focus, our hotel, lodges, and restaurants excelled in providing
our guests/customers with consistently high-quality experiences,
fostering amazing relationships and leaving a lasting impact to support
our vision of becoming Namibia’s ‘Most Loved Hotels and Lodges’.
- ‘Sustainable execution in everything’ (another 2019 Strategic Focus
Area) remains an integral part of our operational strategy, with
our aim to reduce our carbon footprint and enhance our operational
efficiency with the implementation of green initiatives. To this end, we
have concluded MoUs with O&L Energy to install solar power plants at
both Mokuti Etosha Lodge and Midgard Country Estate.
These achievements for the year ending 30 June 2017 and the positive
outlook on tourism in the country provide the foundation for O&L
Leisure’s journey towards FY19.
We are very confident that Namibia is set to become a better value-for-
money, safer, and more welcoming destination to international travellers
in the future and the outlook for the next trading year is very optimistic,
especially given the new direct airline routes coming into Namibia.
ADVERTISINGWEATHERMEN & CO (PROPRIETARY) LIMITED
With a foundation of solid and strategic creative work, and celebrating
four years in the business, Weathermen & Co has grown its portfolio
of established and new clients by winning a five-way pitch for the
premium advertising contract with the country’s leading mobile
telecommunications service provider, Mobile Telecommunications
Limited (MTC), as well as the account for First National Bank (FNB) and
other brands in the Rand Merchant Bank (RMB) stable. Although these
new wins did not translate into financial gains in FY17, they are anticipated
to have a significant financial impact on the business in FY18.
The overall economic climate has had a direct impact on our revenue
and profitability as clients cut down on general budget spent and in
particular reduce their spending on the marketing segment, which plays
a crucial role in any business. Despite these challenges, our talented and
passionate team − supported by a strong imaginative culture as well as
a pool of great clients and shareholders − contributed to the cementing
of Weathermen & Co’s solid reputation nationally. We remain committed
to making a significant contribution to, and impact on, the following
strategic focus areas:
- Elevating the creative product and improving client services by
attracting talented staff;
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- Initiating a Group-wide waste management programme;
- Entrenching the Sustainability Index
- 20% carbon-footprint saving initiatives on track;
- Conceptualising and implementing the Facial Recognition Campaign
for O&L Leisure at the Namibia Tourism Expo;
- Cyber-security: launching our first ever Social Engineering Assessment
and Awareness campaign
- Significantly improving email security.
We are confident that the O&L Centre will continue to deliver value
throughout the Group by further centralising critical support functions
and delivering on FY18 breakthrough initiatives, as well as playing a
significant role in ensuring that O&L becomes ‘The most progressive and
inspiring company’ by 2019.
AVIATIONEROS AIR (PROPRIETARY) LIMITED
Eros Air (Proprietary) Limited was founded in 1978 and provided express
corporate transport and charter flights for medical and private purposes
until a tragic accident on the 29th of January 2016 that claimed the lives
of 3 pilots. Namibia Breweries Limited (NBL) – a subsidiary of the O&L
Group – has since purchased Eros Air’s second aircraft and donated it to
the Intelligence Support Against Poaching (ISAP) in support of the fight
against rhino poaching. Although the Eros Air hangar is currently leased
out, the operation itself is dormant.
ASSOCIATE & JOINT VENTUREBRANDTRIBE (PROPRIETARY) LIMITED
The Brandtribe joint venture had a difficult year, with revenues declining
by N$1.3 million against 2016 levels. This was driven by the decline in
SMS gateway revenue in Namibia. During the year under review there
was significant focus on the future of the Brandtribe platform and we
invested N$600 K in 2017 to create a new ‘Insights’ platform, which will
form part of the overall Brandtribe platform offering in FY18.
When we completed development of the Insights platform, we tested
its viability as a standalone offering in the marketplace. The test market
was reasonably successful; however, we did not achieve the results that
would justify full commercialisation just yet. Despite this we learned
two valuable lessons about the creation of an e-commerce site that can
accept payments from anywhere in the world: using large test markets
like Nigeria and Egypt can provide quick and robust feedback, and small
changes to the user experience can dramatically increase adoption rates.
In South Africa, the date for the Protection of Personal Information Act,
No 4 of 2013 (POPI Act) to come into force is likely to be December 2017,
which means that organisations will have to be compliant by late 2018.
This legal development will play to the strengths of Brandtribe’s products
as they were designed to comply with the equivalent European laws
from their inception. During the year ahead we will focus on improving
the Brandtribe joint venture; integrating the Insights platform into
Brandtribe’s operations; and further developing Insight’s capabilities.
DIMENSION DATA NAMIBIA (PROPRIETARY) LIMITED
In the past year, Dimension Data Namibia contributed to the group with a
profit of N$5.3 million - phenomenal growth from the prior financial year.
Some of our achievements include:
- Celebrating our 10th year;
- International recognition by being awarded with the PMR Arrow award,
for our contribution to the Namibian economy.
- Our staff selected to serve on the executive board of Internet Exchange
Point (IXP) in Namibia.
- We continued to make inroads by restructuring our operations to
ensure a higher level of service delivery.
With tougher trading conditions we maintained our commitment to
enroll 6 students in the XT program and delivered exceptional financial
results to ensure meeting our shareholder expectations.
UNCHARTERED OCEANS
NOURISHING POTENTIAL
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Alternate Trustee of Namibia Business School; and Trustee of the O&L
Pension Fund.
Gideon ML Shilongo, Namibian (1964).
Group Corporate Affairs Director (since 9 July 2014).
Qualifications: Advanced Diploma in Business Administration Professional
Membership: MABE, MCIM, FSBP, ACIBM.
Director of various O&L companies within the Group; Director of Offshore
Development Company (Pty) Ltd; Director of Wilderness Safaris Namibia
(Pty) Ltd; and a board member of the Namibia Competition Commission,
Team Namibia, and the Namibia Trade Forum.
Patricia Hoeksema, Namibian (1974).
Executive Director (Alt. to S Thieme) (since 1 October 2015).
Joined the O&L Group in October 2004 as Corporate Social Investment
Manager at Namibia Breweries Limited. Moved to the O&L Centre in July
2013 as Group Corporate Relations Manager.
Qualifications: Bachelor of Economics Degree from the University of
Namibia (majored in Economics and Management Science).
Fields of work experience include: research and marketing (1997 - 1998);
economics and planning (1999 - 2004); and corporate social investment
and public relations (2004 to date). Member of the Welwitschia School
Trust.
NON-EXECUTIVE DIRECTORS
Hans-Harald Müseler, Namibian (1949).
Appointed 2009 as an Alternate Director and then as a full Director as of
20 March 2014.
Qualifications: Chartered Accountant (Namibia), MBA (Stellenbosch), Post-
Graduate Diploma: Compliance and Board Governance (University of
Johannesburg).
Chairperson of the O&L Audit Committee; member of the audit
committees of Bidvest Namibia, Sanlam Namibia, and Capricorn Unit
Trust Management. He is a Trustee of the Benchmark Retirement Fund
(Chairperson) and an advisor to the Meat Board Audit Committee.
Ernst Ender, German (1945).
Appointed: 23 June 2008.
Joined the O&L Group in 1975 as Marketing Manager at Namibia Breweries
Limited, appointed to the Namibia Breweries Limited Board in 1983.
Qualifications: 2-year post-graduate commercial traineeship with AC
Toepfer International.
Director of various O&L companies within the Group and has over three
decades’ experience relating to marketing, sales and export.
Laura McLeod-Katjirua, Namibian (1959).
Appointed: 2 April 2012.
Qualifications: Diploma in Development Studies and Management
(Tanzania Uyole Agricultural College), Diploma in Basic Education (Zambia
University).
Regional Governor of Khomas Region; member of the National Heritage
Council of Namibia (NHCN); and a Director of SeaFlower (Fishcor).
Carl-Ludwig List, Namibian (1948).
Appointed: 27 February 1980.
Joined the O&L Group in 1972 in various positions including the Managing
Director (MD) of the then Corporate Headquarters of O&L.
Qualifications: Banking (1971 Germany).
Whilst the MD at the (then) O&L Group Corporate Headquarters he
implemented and monitored the strategic, HR, and information
management strategies for the Group; director of various O&L companies
within the Group.
PRINCIPLES OF CORPORATE GOVERNANCE The Directors of the O&L Group of Companies remain firm in their
commitment to maintaining the highest standards of corporate
governance, an obligation that they view as fundamental to discharging
their stewardship responsibilities satisfactorily. All the Group’s businesses
share in this commitment; the adoption of, and adherence to, sound
corporate governance policies represent a business imperative for the
Group.
Our Board strives to provide the right leadership, as well as the strategic
oversight and control environment to produce and sustain value delivery
to all its stakeholders. The Board continues to reflect a culture of
openness, accountability and integrity − reflected in its commitment to
best practices. The Group is proud of its ethical and transparent business
management, not only in following accepted corporate practices for
risk management but also in providing strong assurance to its own
shareholders, and other stakeholders, by living the Group’s ethics.
GOVERNANCE AND COMPLIANCE OVERVIEW The Board has continued to strive towards the highest standards of
best corporate governance and to further align the Company with the
principles and practices contained in the NamCode during the year under
review.
THE O&L BOARD OF DIRECTORS EXECUTIVE DIRECTORS
Sven Thieme, Namibian (1968).
Group Executive Chairman (since 17 April 2002).
Joined the O&L Group in 1998, elected as Chairman in 2002.
Qualifications: Chartered Accountant (Namibia).
Director of various O&L companies within the Group, Chairman of the
Werner List Trust, President of the NCCI (Namibia Chamber of Commerce
and Industry), Chairman of the WCC (Windhoek Country Club), Chairman
of NBC (Namibia Broadcasting Corporation), Member of the National
Planning Commission.
Peter Grüttemeyer, Namibian (1953).
Chief Executive Officer (since 1 October 2003).
Joined the O&L Group in 2003.
Qualifications: Chartered Accountant (Namibia).
Previously the Partner-in-Charge of Deloitte Namibia, Director of various
O&L companies within the Group, Chairman of NASRIA (National Specific
Risks Insurance Association) Trustee of the Goreangab Trust, Lloyd’s
representative in Namibia.
Günther Hanke, Namibian (1956).
Group Financial Director (since 16 November 2004).
Joined the O&L Group in 1989.
Served as the Financial Director at Namibia Breweries
Limited (until 1996), and then rejoined the O&L Group on
16 November 2004.
Qualifications: BCom (Accounting) (University of Pretoria) and a registered
professional accountant (SA) with SAIPA.
He has held various senior executive positions over the past three
decades in the manufacturing, telecommunication and mining sector. He
has been a director of various O&L companies within the Group, and is
Chairman of Dimension Data Namibia.
Berthold Mukuahima, Namibian (1959).
Group Human Capital Director (since 1 May 2006).
Joined the O&L Group in 2006.
Qualifications: BA (University of Fort Hare); Certificate in Industrial
Relations; MBA (Ohio University).
He has accumulated over three decades’ experience in strategic HR
management in the higher education, telecommunications, and private
sectors and is Trustee Chairman of HealthWorks (formerly, NABCOA);
CORPORATE GOVERNANCE
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Apart from the review of the Governance content, which was also
performed in the previous period, the Board has assessed the Corporate
Governance section within the context of the NamCode.
The way that the Board communicates with all stakeholders embodies
the principles of balanced reporting, comprehensibility, openness, and
valuing substance over form. The Board is aware of the importance
of communicating the Group’s activities to stakeholders in a balanced
and comprehensible manner and strives to present clearly any matters
material to a proper appreciation of the Group’s position.
The interests and concerns of the Group’s stakeholders are addressed by
communicating information as it becomes known.
BOARD MEETINGS AND ATTENDANCE Meetings held by the Board during the financial year under review, and
the concomitant attendance by members was as follows:
MEMBERS 19/7/2016 22/9/2016 4/4/2017
E Ender # A A
P Grüttemeyer A A A
G Hanke A A #
Rev. WS Hanse A A A
C-L List A A A
G Shilongo A A A
Gov. LV McLeod Katjirua A A A
B Mukuahima A A A
HH Müseler A A A
UM Stritter A A A
S Thieme A A A
P Hoeksema (Alt. to S Thieme) A A A
A - Attended # - Apologies
BUSINESS PERFORMANCE, ACCOUNTING AND AUDITING
GOVERNANCE STRUCTURE
Udo Manfred Stritter, Namibian (1939) (Vice-Chairman)
Appointed: 24 March 1994
Joined the O&L Group in 1971 as legal advisor and assistant to the late
Chairman, Werner List; has been a Director since 1994
Qualifications: Attorneys admission (University of South Africa)
A practicing attorney since 1969 and senior partner and sole owner
from 1970 to 1976 of Engling Stritter & Partners, focusing mainly on
commercial law; director of various O&L companies within the Group;
Executive Chairman and CEO of Namibia Estate Enterprises (Pty) Ltd and
Japonica Investments Nineteen (Pty) Ltd
Reverend Willem Hanse, Namibian (1965).
Appointed 2 April 2012.
Qualifications: Undergraduate from Academy (UNAM), Windhoek, 1988
(majored in History and Psychology) and Pastoral Training from R. R.
Wright Seminary, Johannesburg, 1995.
He has experience in: compliance, marketing and public relations
(1990 - 2003); was Special Assistant to the Prime Minister and Speaker
(2003 - 2010); he has also been presiding elder at various AME churches
since 2010; Director of O&L Holdings (Pty) Limited and Director of EPIA
Investment Holdings (Pty) Limited.
RESPONSIBILITIES OF THE BOARD
The overarching responsibility of the Board is to exercise stewardship
of the Group within a framework of prudent and effective controls that
enable risks to be assessed and managed. The Board is tasked with setting
the Group’s strategic aims; it reviews whether the necessary financial and
human resources are in place for it to meet its objectives; and it monitors
management performance. Regular business performance reports keep
the Board informed about major developments affecting the Group.
In terms of the Board Charter − reviewed on an annual basis − the Board
has the overall authority for the conduct of the Group’s business. There
are also a number of matters that have been specifically reserved for the
Board’s consideration, which include the following:
- Approval of financial reporting and controls − such as interim and
annual results, the payment of dividends, and accounting policies;
- Monitoring the cash and capital resources of the Group, as well as its
overall liquidity, and authorising any significant acquisitions, disposals
of core businesses, investments, capital expenditure, or other material
projects or transactions;
- Monitoring and managing the relationships between the Group and its
regulators;
- Reviewing and implementing effective systems of delegation and
internal control, and carrying out an annual review of the effectiveness
of such systems;
- Identifying and continually reviewing key risks, as well as their mitigation
by management, against a background of economic, environmental
and social issues;
- Reviewing and approving the Group Strategy and the setting of long-
term objectives and/or changes in strategic direction;
- Monitoring the overall performance of the Group in relation to its
objectives, plans, and targets, as well as monitoring the implementation
of projects and decisions;
- Ensuring that the Company has an effective and independent Audit
Committee;
- Assuming responsibility for information technology (IT) governance;
- Confirming that the risk-based internal audit function is effective;
- Monitoring how stakeholders’ perceptions affect the Group’s
reputation; and
- Verifying the integrity of the Group’s Integrated Annual Report.
The Board is aware that in the period under review, independent
assurance was obtained on this Integrated Annual Report.
BOARD GOVERNANCE STRUCTURE Board Committees
AuditCommittee
RiskCommittee
Remuneration Committee
Board of Directors
Shareholders
Secretary
MANAGEMENTGOVERNANCE STRUCTURE
Group Leadership Team (GLT) - meeting at least monthlyComprising of all Executive Directors of the holding company
and key senior management
Group Executive (GE) - meeting 10-12 times a yearComprising of all Managing Directors of the
operating companies and GLT
Top Leadership Team (TLT) - meeting 2-3 times a yearComprising of GE and Senior Managers
OPERATIONAL MANAGEMENT GOVERNANCE STRUCTURE
AT EACH OPERATING COMPANY
Business Performance review meetingsFull, in-depth business performance review meetings are held quarterly, with shorter
performance update meetings being held in the other months. (GLT with SLT)
Senior Leadership Team (SLT) - meeting weekly or monthly as the need may be
(Comprising of Head of Departments)
Middle Leadership Team (MLT) - meeting weekly or monthly as the need may be(Comprising of senior management within
the various departments)
Group Operational
Meetings
(Held twice a year)
(Full review of operations)
(Attended by GLT & SLT)
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internal audit is an independent appraisal and assurance function that
is central to the Group’s governance structures. Its primary purpose is
to examine and evaluate the appropriateness and effectiveness of the
internal control systems applicable to the operational activities of the
business units within the Group. The Group utilises the independent
professional services firm EY to provide outsourced internal audit
functionality, which is currently focussed on NBL.
The Audit Committee is responsible for overseeing the internal audit
function and approving the Internal Audit Plan. The Audit Committee
ensures that the Company’s internal audit function is independent and
has the necessary resources, budget, standing and authority within the
Company to enable it to discharge its functions.
An Internal Audit Charter is formally defined and approved by the
Board. The Head of Risk has direct access to the Chairman of the Audit
Committee.
The internal audit function’s key responsibilities include: evaluating
the Company’s governance processes (including ethics); undertaking
an objective assessment of the effectiveness of risk management and
the internal control framework; systematically analysing and evaluating
business processes and associated controls; and providing sources of
information, as appropriate, regarding instances of fraud, corruption,
unethical behaviour and irregularities.
The internal audit function reports to the Audit Committee at every
meeting and has the cooperation and support of both Board and
management.
Nothing has come to the attention of the Directors to indicate any
material breakdown in the functioning of these controls, procedures and
systems during the year under review.
BOARD COMMITTEES While the Board remains accountable to the Group and is responsible for
the Group’s performance and affairs, it delegates to management and
Board committees certain functions to assist it with properly discharging
these duties. Appropriate structures for such delegations are in place and
are accompanied by monitoring and reporting systems.
Each Board committee acts within agreed written terms of reference. The
chairperson of each Board committee is asked with delivering a report
at each scheduled Board meeting and minutes of Board committee
meetings are provided to the Board.
All Directors, as well as the chairperson of each Board committee, are
requested to attend AGMs to answer questions raised by shareholders.
The various Board subcommittees currently operating are set out
below. The current CEO is a member of the Audit and the Remuneration
subcommittees, as a consequence of the specific knowledge and
experience he possesses. Over time, however, these subcommittees will
be structured to exclude the CEO and to have majority Non-executive
Directors.
AUDIT COMMITTEE
During the financial year under review, the Audit Committee comprised
two Directors: one of them was an independent Non-executive Director
− Mr HH Müseler (Chairman) − while the other was an Executive Director,
being Mr P Grüttemeyer. The Group is currently working to recruit a
suitably qualified candidate for a vacant non-executive position on this
committee.
BUSINESS PERFORMANCE REVIEW MEETINGS
Monthly business performance review meetings are held with each
individual operation within the Group. Full, in-depth business performance
review meetings are held quarterly, with shorter performance update
meetings being held in the other months.
The purpose of the full business performance review meetings is to
conduct an in-depth review of a specific operation’s performance and
progress in disciplines such as finance, marketing, human capital, risk
management, corporate citizenship and responsibility, and IT. These
meetings are attended by the Group Leadership Team and the senior
leadership team of the operation in question. The purpose of the
performance update meetings is to focus on and discuss key issues
affecting the individual operation, as well as its financial results and
forecasts. These meetings are attended by the chairperson, the managing
director and the financial director/manager of each individual operation.
GROUP OPERATIONAL MEETINGS
The purpose of these meetings is to review and evaluate the Group’s
centralised functions’ performance and progress in disciplines such
as finance, marketing, human capital, risk management, corporate
citizenship responsibility, and IT. The meetings provide a platform
for identifying opportunities and synergies within the Group and for
discussing issues requiring the Group’s attention. These meetings, which
are held twice a year, are attended by the Group Leadership Team, senior
managers of the centralised functions, and the managing directors and
financial directors/ managers of the OpCos.
AUDIT AND RISK COMMITTEES ACCOUNTING, AUDITING AND REPORTING
This 2017 Integrated Annual Report focuses on material developments
and issues and provides pertinent, related performance indicators. We
define a material development or issue as one that affects our ability to
remain commercially viable and socially relevant to the communities in
which we operate.
The Board places strong emphasis on achieving the highest standards of
financial management, accounting, and reporting to our stakeholders. The
Directors are responsible for preparing the Annual Financial Statements
(and other information presented as part of these statements) in a
manner that fairly presents the state of affairs, the results of operations,
and the cash flows of the Group in the year under review.
The external auditors are responsible for carrying out an independent
examination of the Annual Financial Statements in accordance with
the International Standards on Auditing (IASs). The external auditors
also declare whether or not the Annual Financial Statements are fairly
presented and whether or not they comply with International Financial
Reporting Standards (IFRSs). Our lead audit partner from Deloitte changed
during 2017, thus ensuring continued independence.
The Group’s own Audit Committee evaluates the independence and
effectiveness of the external auditors and considers whether any non-
audit services rendered by such auditors substantially impair their
independence. If this is found to be the case, appropriate corrective
action is taken with regard to those services.
INTERNAL AUDIT AND CONTROL
The Group’s internal controls are designed and operated to support the
identification, evaluation, and management of risks affecting the Group,
as well as the business environment in which it operates.
Internal control systems provide management and the Board with
reasonable assurance as to the integrity and reliability of financial
statements. Responsibility for the adequacy and operation of the
systems is delegated to the Executive Directors. The records and systems
are designed to safeguard assets and to prevent and detect fraud. The
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In appointing members to the Risk Committee, a potential candidate’s
education and/or business experience within the committee’s scope of
activities are taken into account. The Risk Committee is a subcommittee of
the Audit Committee and gives feedback at Audit Committee meetings.
Whilst the membership of the Risk Committee would normally comprise
Non-executive Directors, in its current form the membership is made
up of the persons listed above. The Audit Committee achieves oversight
of the Risk Committee by means of the Chairmanship being fulfilled by
the CEO (who is also a member of the Audit Committee) as well as the
(optional) attendance of H Müseler, the Chairman of the Audit Committee,
who is an independent Non-executive Director and that of the internal
auditors, EY. The Risk Committee met twice in the last financial year.
REMUNERATION COMMITTEE
The Remuneration Committee consists of two members: C Swart-
Opperman (Dr) (Chair, (appointed 19 July 2016)) and Mr P Grüttemeyer
(CEO) and its responsibility is to review the remuneration of the Group’s
executive leadership, as well as performance bonuses and Directors’ fees.
The remuneration of senior executives is based on their performance
within their area of responsibility and is calculated using key indicators
of operational and financial performance, among other factors. The
Board’s remuneration philosophy dictates that rewards to executives
are balanced against the interests of the Group and its shareholders.
The Remuneration Committee is also empowered by the Board to set
the short- and long-term remuneration of Executive Directors. More
generally, the committee is responsible for the assessment and approval
of a broad remuneration strategy for the Group, which is documented
in the Remuneration Policy and the committee is at liberty to solicit the
assistance of outside consultants with specialised skills and expertise
to formulate and maintain an equitable compensation structure.
The committee’s Terms of Reference are set out in a Remuneration
Committee Charter.
There was one Remuneration Committee meeting held during the period
under review:
MEMBERS 14/3/2017
C Swart-Opperman (Dr) A
P Grüttemeyer A
A - Attended
The Board appoints the members of the Remuneration Committee
by taking into consideration potential candidates’ education and/or
business experience within the committee’s scope of activities. Members
are appointed for a 3-year term, with the initial term for at least one
member being two years and for at least one other member being one
year.
The Remuneration Committee does not recommend disclosure of
individual Director’s fees. These fees of the executive Directors’ are paid
by subsidiaries and not by the holding company. For subsidiaries whose
shares are listed, the full Director’s remuneration was disclosed in the
respective integrated annual report of that listed subsidiary.
PROFESSIONAL ADVICE
All Directors have access to the advice and services of the Company
Secretary, who is responsible to the Board for ensuring compliance with
procedures, as well to applicable statutes and regulations. All Directors
also have full and timely access to all information that may be relevant to
the proper discharge of their duties and obligations, thus enabling the
Board to function effectively.
The Company Secretary ensures that Board charter and various terms
of reference are regularly reviewed and complied with and ensures that
all minutes are circulated to the relevant Directors. A Board evaluation
process has been adopted and implemented through the Directors’
Governance Policy.
The Audit Committee’s Terms of Reference are set out in the Audit
Committee Charter. The Audit Committee is mandated by the Board
to review the financial statements, the appropriateness of the Group’s
accounting and disclosure policies, its compliance with IFRSs, and the
effectiveness of internal controls. In keeping with this mandate, Deloitte
(Namibia) was re-appointed as the Group’s external auditors, while EY
fulfilled the role of internal auditor, as stated previously.
Both the external and internal auditors have unrestricted access to the
Audit Committee and attend all meetings to report on their findings and
to discuss matters relating to accounting; auditing; risk identification,
measurement and mitigation; internal controls; and financial reporting.
The Audit Committee ensures that a combined assurance model is
applied to provide a coordinated approach to all assurance activities.
The Audit Committee is tasked with satisfying itself as to the
appropriateness, expertise, and adequacy of resources of the finance
function and the experience of the senior members of management
responsible for the financial function. This is an evaluation that is
performed annually.
The Audit Committee is also responsible for overseeing the content
and disclosure of the Integrated Annual Report and has been tasked by
the Board to assist in overseeing the integrity of the Integrated Annual
Report. The Audit Committee has complied with its legal, regulatory or
other responsibilities and has recommended the 2017 Integrated Annual
Report to the Board for approval.
The Audit Committee meets at least twice a year − preferably before the
Board’s approval of the interim results and then again after the annual
external audit has been completed but prior to the Board’s approval of
the Annual Financial Statements.
Meetings held during the financial year under review and attendance by
Audit Committee members were as follows:
MEMBERS 21/9/2016 29/4/2017
P Grüttemeyer A A
HH Müseler A A
A - Attended
Appointments to the Audit Committee are made by the Board and
take into account a potential candidate’s education and/or business
experience within the Audit Committee’s scope of activities. Members
are appointed for a 3-year term, with the initial term for at least one
member being two years and for at least one other member being one
year.
RISK COMMITTEE (A COMMITTEE OF THE AUDIT COMMITTEE)
The purpose of the Risk Committee is to assist the Board of Directors
in fulfilling its oversight responsibilities with regard to the risks inherent
in the Group’s business, as well as the control processes with respect to
such risks; the assessment and review of credit, market, fiduciary, liquidity,
reputational, operational, fraud, strategic, technology, data-security and
business-continuity risks; and the monitoring of the Group’s overall risk
profile, including significant risks faced by individual companies within
the Group as well as by the Group as a whole.
Membership comprises people in the following roles:
- Executive Chairperson;
- Chief Executive Officer (Chairperson of the Risk Committee);
- Group Financial Director;
- Group Human Capital Director;
- Head: Group Risk Management;
- Chairpersons of OpCos’ risk committees; and
- Company Secretary.
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Board nominations are considered through the Remuneration
Committee and recommendations on appointments are made to the
Board for adoption.
CONFLICTS OF INTEREST
At every Board, Board committee, and management meeting of the O&L
group, the chairperson of that specific meeting asks all members and
attendees to disclose any possible conflict(s) of interest in respect to
any of the business to be discussed. Furthermore, this requirement is a
standing agenda item at every meeting.
Once a year, the Company Secretary forwards a Conflict of Interest
Declaration Form to all the Directors for completion, as required in terms
of sections 237 to 248 of the Namibian Companies Act 28 of 2004. The
completed forms are then filed. The Directors are aware that should
there be any change or addition to any information detailed in their
declarations of private interest, they are required to notify the Company
Secretary within 30 days of such change or addition occurring.
COMPLIANCE WITH LAWS, RULES, CODES AND STANDARDS
The Board acknowledges its responsibility in ensuring that the Group is
compliant with all relevant laws, rules, codes and standards. The Board has
ensured that an effective Compliance Framework has been established
and implemented. This Compliance Framework is designed in such a
way that the relevant laws, rules, codes and standards are identified;
compliance monitored; and any instances of non-compliance rectified.
The compliance function has been delegated to each OpCo, while
the Audit Committee − through the Group’s Risk Committee − has an
assurance programme in place to confirm that compliance to relevant
laws, rules, codes and standards is applied within each individual business.
During the reporting period, no fines or sanctions, which are deemed
material by the Board, for non-compliance with laws and regulations
were initiated against the Group and no legal action for anti-competitive
behaviour was instigated.
RISK MANAGEMENT PRACTICES
The Board is ultimately responsible for managing the Group’s risk and
setting its risk appetite. The Risk Management System is designed to
manage (rather than eliminate) the risk of failure in order to achieve
business objectives. The system includes having ongoing processes in
place to identify, assess, manage, monitor, and report on the significant
risks faced by individual companies within the Group as well as by the
Group as a whole.
A Risk and Opportunity Assessment is conducted on an annual basis at
the OpCos to ensure that management remains aware of these issues
throughout the Group. The assessment process identifies the critical
business, operational, financial and compliance exposures facing the
individual operation, as well as the adequacy and effectiveness of control
factors at all levels.
Materiality levels are set for each business-unit level and vary according
to the nature, scope and size of the business concerned. In setting these
levels, due consideration is given not only to financial impact(s) but also
to the potential threat to the integrity of the business as a going concern,
its reputation, and the wellbeing of employees and other stakeholders.
Each OpCo in the Group has its own risk committee that identifies major
risks from the risk assessments outlined above and ranks these on a
risk matrix. The Group has a formal risk management process, which is
documented in the Group’s Risk Management Policy. The Group’s risk
matrix is collated from the risk matrices of the individual OpCos.
The Group risk matrix is used as a tool to assist management in recognising
all material risks to which the Group is exposed and ensuring that the
required risk management culture, practices, policies, resources and
systems are progressively implemented and function effectively. The risk
committees of the various OpCos report to the Group’s Risk Committee.
The systematic risk assessment process ensures that risks, opportunities,
and risk controls are not only adequately identified, evaluated, and
managed at the appropriate level in each OpCo but also that their impact
on the Group as a whole is taken into consideration. In the period under
review the Group did not expose itself to any undue, unexpected, or
unusual risks that caused it to suffer material losses.
The Board of Directors is of the opinion that the risk matrix is an
appropriate tool for risk identification and assessment. The matrix is
very detailed and specific; it is therefore not disclosed in this Integrated
Annual Report in order to ensure that no confidential information − and
thus undue advantage − is provided to our competitors.
During the reporting period, the Group continued to utilise the BarnOwl
risk management software throughout the Group, thus ensuring that a
unified and structured risk-management approach is applied across the
Group, as well as entrenching the risk management framework.
The Group recognizes the current poor trading conditions both
within Namibia and across the SADC region and the situation is being
monitored on a continuous basis to ensure that all potential risks and
opportunities that present themselves are adequately evaluated and that
the appropriate corrective management measures are taken. The Group
also remains aware of the long-term water-security challenges faced
by Namibia (and the central highlands in particular) and has identified
adequate mitigation responses to address associated risks.
The Group has entrenched its anti-corruption policies and procedures
during the reporting period through its Annual Declaration Programme,
communication of its Code of Ethics, and the implementation of a
commercial crime audit at all of its OpCos.
The Group has adopted a zero-tolerance stance on fraud and regrets
to report that one incident of fraud has been investigated at one of its
subsidiaries during the reporting period. The loss caused by this incident
was not, however, material. This incident has been reported to the
relevant authorities for further investigation.
SUCCESSION PLANNING
The Group benefits from having an extensive pool of people with diverse
experience and high levels of competence at senior management level
and as a result the Board is confident that it is able to identify suitable
short- and long-term replacements from within the Group when the
need arises.
The Group has an established Talent on the Move Programme, through
which information regarding forthcoming Company vacancies in key
positions is widely disseminated internally − thus taking succession
planning to the next level. Employees are encouraged to submit their
names for consideration through the programme so that their capacities
can be developed to fill these positions once they become available. Two
objectives are aimed at here: employees take charge of their own career
development, and the Company has a database of talented individuals
who are ready to move into higher positions when the opportunity arises.
GOVERNANCE OF INFORMATION TECHNOLOGY
The Board, assisted by the Risk and Audit committees, is responsible for
the governance of information technology (IT) across the entire Group.
The Board recognises that IT is essential to managing the transactions,
information, and knowledge necessary to initiate and sustain the Company.
The Board has adopted and implemented an IT Control Framework. The
external auditors provide assurance on the IT Control Framework when
conducting their annual audit. During 2016 and 2017, this external review
did not result in any significant or material findings.
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The Board is aware that the Group’s IT strategy must be integrated within
the Company’s strategic and business processes as a matter of priority.
Although the Board is ultimately responsible for the IT governance
framework, it delegates the responsibility for implementation to
management. There is an appointed Manager: Group Information
Systems who is responsible for the management of IT; the Board is
confident that the Manager: Group Information Systems is a suitably
qualified and experienced person who has been primarily appointed to
act as a bridge between IT and the business. The Group’s IT Strategy Plan
is reviewed and signed by the Ohlthaver & List CEO, Mr Peter Gruttemeyer.
The IT Strategy Plan is maintained on the O&L Process Model.
The Board is further responsible for the monitoring and evaluation of
the investment and expenditures incurred for IT by the Group, so that
it can ensure that the Company acquires and uses the appropriate
technology, processes and people to support its business and governance
requirements in a timely and relevant manner. At this stage, the bi-
annual Group Operational Meetings (GOM) (and to a lesser extend the
monthly Business Performance Review’s (BPR’s)) are used as forum for
the IT Steering committee. All significant IT initiatives are presented and
reviewed at the GOM and/or Centre of Excellence BPR’s, or, if needed due
to the investment involved, at Board level.
Information technology risks fall under the Group’s risk management
activities and considerations. The Board recognises that IT legal risk
arises not simply from the possession, ownership, and operational use
of technology but also from the possibility that there may be misuse
(inappropriate or negligent use) of the technology − which might directly
lead to the Company becoming a party to legal proceedings. Furthermore,
the Group is aware of the need for compliance with applicable laws, rules,
codes and standards that are affected by IT and the Board therefore
ensures that these IT-related laws, rules, codes and standards are identified,
with the objective of ensuring adherence to them.
The Board, through various processes, ensures that the information
generated and stored by its IT system is kept secure, private, and
confidential and that it is also available to permitted users in a timely
manner and in a suitable format.
These processes are implemented, documented and maintained on the
Process Model. The Process Model includes the following:
- Business continuity;
- Change control;
- Acceptable IT policies and procedures;
- Security policies and procedures; and
- IT security standards.
Moreover, various other measures have been put in place to safeguard
the Group’s IT environment, including the following:
- Cyber-security assessments and awareness campaigns; and
- Annual IT controls audits by external auditors.
Information records are the most important information assets as they
are evidence of business activities. Information management and privacy
& security are of crucial importance, and the Group is thus evaluating the
implementation of a “Data Loss Prevention Solution” as presented at a
recent Group Risk Meeting
DISPUTE RESOLUTION
The Board recognises the importance of resolving disputes with all
stakeholders as effectively, efficiently and expeditiously as possible and
to this end it has implemented a Dispute Resolution Methodology. This
methodology stipulates that conflict and dispute resolution are dealt
with through constructive dialogue with the relevant parties in the first
instance. Where this preferred method does not result in adequate
resolution of the matter, external legal advisers, mediators and/or
arbitrators are engaged to expedite resolution. For labour disputes
specifically, the Directors make use of the Labour Act No. 11, of 2007
− which has a provision for alternative dispute resolution that is distinct
from the Compulsory Dispute Resolution Mechanism channelled through
the office of the Labour Commissioner.
SWELTERING SUNLIGHT
LIM
ITLE
SS
ENER
GY
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SOCIAL SUSTAINABILITYHUMAN CAPITAL
Employment Equity
The O&L Group of Companies subscribes to the principle of equal
opportunities for all; thus it gives preference to Namibian citizens when
filling vacant positions across the Group. Furthermore, the Group strongly
supports the Affirmative Action (Employment) Act, 1998 (No. 29 of 1998),
and duly files the required Affirmative Action Report with the Office of the
Employment Equity Commission on an annual basis.
The above table indicates that as at 30 June 2017, 86 % of senior
management and Executive Directors are Namibian citizens who have
been hired from within the country.
The number of non-Namibians employed increased from 62 to 65 during
the reporting period, mostly as a result of recruitment within the leisure
division, where the Company relies to an extent on expatriates with skills
in hotel management. Employment of those who are classified as disabled
increased from 7 (2016) to 11. There was no significant change in the
total employee complement for the period under review compared to the
previous period.
JOB CATEGORY RACIALLY RACIALLY PERSONS WITH NON-NAMIBIANS TOTAL
DISADVANTAGED ADVANTAGED DIABILITIES
Men Women Men Women Men Women Men Women Men Women
Executive Directors 5 0 13 1 0 0 1 0 19 1
Senior Management 22 7 38 16 0 0 13 3 73 26
Middle Management 193 134 96 50 0 0 27 8 316 192
Specialised/skilled/senior supervisory 306 338 27 18 3 0 5 4 341 360
Skilled 632 299 5 8 2 1 0 1 639 309
Semi-skilled 1089 1176 0 0 2 1 0 0 1091 1177
Unskilled 302 495 0 0 1 0 0 0 303 495
Total permanent 2549 2449 179 93 8 2 46 16 2782 2560
Fix terms/Temporary 435 300 8 2 0 1 3 0 446 303
Total 2984 2749 187 95 8 3 49 16 3228 2863
WORKFORCE PROFILE AS AT 30 JUNE 2017
RISKS FROM CLIMATE CHANGEOhlthaver & List continues to note with concern the accruing evidence of
the escalating threat that climate change poses to our operations in our
highly arid country, as well as to the rest of the world.
The nationwide drought that has blighted the past two years is of
particular concern and the Group believes that such extreme climate
events will continue into the future. As water is one of our Group’s most
material issues, the rising costs of this scarce resource are set to pose an
ongoing financial challenge to operations − especially in view of the water
shortage in especially Windhoek that continued with supplies at critical
levels during the reporting period. The local authority announced a 20%
increase in water tariffs for the Windhoek area for the new financial year.
Due to Namibia’s arid landscape and its legislation against the use of
genetically-modified crops (GMOs) as animal feed, the Group continuously
has concerns relating to the future cost of feed for our dairy cows and
the price of barley as a raw material for some of our processes in coming
years. Importing these raw materials from overseas markets is a costly
endeavour. As a material issue for the Group, the cost of doing business
is therefore a risk that could increase greatly with climate change.
The Group is attempting to manage this through long-term purchase
agreements with fixed pricing and by ongoing supplier performance
evaluation, as well as by growing our own animal feed and constantly
monitoring the prices and costings to our dairies.
LOCAL HIRING AND PROCUREMENTThe O&L Group is committed to contributing to communities by,
among other things, hiring and procuring locally wherever possible. We
therefore continue to give preference to Namibian businesses and small-
and medium-scale enterprises whenever it is possible for us to do so.
During the year under review, local procurement (“procure to pay
process”) spending constituted almost 53% of all our spending on
goods and services, compared to 48% and 50% during the previous two
reporting periods (2015 and 2016, respectively). The majority of imported
commodities comprised barley malt and hops for the brewing industry,
as well as packaging material that cannot be purchased locally for the
brewing and dairy industries.
The uncertain political − and consequently economic − environment in
South Africa, where the majority of packaging materials are procured,
remains a material issue. The risk of industrial action in the packaging
material and transport and allied sectors has eased over the last year,
however, and the depressed regional economy has allowed for more
favourable packaging-material prices.
ECONOMIC, SOCIAL AND ENVIRONMENTAL SUSTAINABILITY
LOCAL PROCUREMENT SPENDING AS % OF TOTAL SPEND
2013/ 2014/ 2015/ 2016/ 2014 2015 2016 2017
Namibia Breweries Ltd 33.5 35.3 38.9 40.6
O&L Centre 59.9 46.7 49.8 53.8
Weathermen & Co 85.0 88.6 88.2 93.2
O&L Organic 75.1
O&L Energy 94.6 100.0 61.7 97.9
O&L Leisure − − − 95.0
Namibia Dairies 52.5 54.4 54.3 58.5
Hangana Seafood 88.8 87.8 83.1 86.5
Model Pick n Pay 80.2 80.1 83.6 83.6
Kraatz Marine 91.0 94.3 94.4 96.7
Total 44.9 47.6 49.7 52.9
SUSTAINABILITY
70
SUSTAINABILITY
71
The Talent on the Move Programme that was launched by the Group
aims to address succession management for key positions in order to
accelerate the development of employees who exhibit potential in their
specific lines of work and who are willing to put themselves forward for
capacity-building and other training.
The Group recognizes that for some specialised roles, competent
incumbents from designated groups may only be available in the long
term, but we nonetheless undertake to ensure that there will be a learning
path to achieving this goal.
In accordance with the Affirmative Action (Employment) Act, the Group will
facilitate the mentoring and development of every Namibian employed as
an understudy to a non-Namibian, should it be necessary to do so. The
understudy employees are also part of the Talent on the Move Programme.
Remuneration
The Group’s Remuneration Policy makes provision for the following
benefits:
- Pension (employee 7% and employer 11% contributions): all grades,
- Medical Aid (50% Company contribution): all grades voluntarily,
- Transport Allowance: grades 1 - 7A,
- Funeral Scheme: all grades,
- Acting Allowance: grades 1 - 7B,
- Car Allowance, Housing Allowance: employees remunerated on a cost-
to-company (CTC) basis
- Incentive Bonus: grades 6A - 9,
- Annual Bonus (13th cheque): grades 1 – 5,
- Annual bonus based on performance: grades 6 - 9,
- Purchases Discount: all grades.
Temporary employees qualify for the subsidised Transport Allowance, 13th
cheque, Productivity Bonus (where applicable), Funeral Scheme, Vitality
HIV/AIDS cover, and Purchases Discount at our retail subsidiaries.
The Group operates across a very wide range of sectors; in the absence of a
Namibian minimum wage it is difficult to make meaningful comparisons of
wages against national pay scales since workers to whom minimum wages
currently apply are limited. At sector level, however, the O&L remuneration
philosophy is to position wages at market midpoint (50th percentile) and
the Group is confident that its average minimum remuneration remains
on par with sector benchmarks.
Employee relations
In the year under review, 61.1% of employees below supervisory and
management grades were covered by collective bargaining agreements
concluded at OpCo level.
Retrenchments, transfers, and organisational changes are all done in
accordance with contracts of employment and no employee is given less
than one month’s notice of any such change relating to their working
conditions.
All employees are subject to the Health and Safety Policy of the Company
- this is a legal requirement and therefore non- negotiable.
There have been no incidents of discrimination, no infringements in terms
of freedom of association or collective bargaining, and no instances of
child or forced labour during the reporting period. No operations were
subject to human rights reviews or impact assessments.
No collective grievances were filed by employees for the period under
review.
Employment Equity Comparison
The table below is a comparison of Racially Disadvantaged employees for
the periods 2017 vs 2016.
LEVEL IN EMPLOYEE HIERARCHY AND GRADE RACIALLY DISADVANTAGED
2016 Variance 2017
Job Category Men Women Men Women Men Women
Executive Directors (Grade 9) 5 0 0 0 5 0
Senior management (grades 8A - 8C) 24 12 -2 -5 22 7
Middle management (grades 7A - 7C) 209 151 -16 -17 193 134
Specialised/skilled/senior supervisory (grades 6A - 6B) 370 350 -64 -12 306 338
Skilled (Grade 5) 431 229 201 70 632 299
Semi-skilled (grades 2 - 4) 1187 1161 -98 15 1089 1176
Unskilled (Grade 1) 246 459 56 36 302 495
Total permanent 2472 2362 77 87 2549 2449
Fix terms/temporary 556 346 -121 -46 435 300
Total 3028 2708 -44 41 2984 2749
The Group recorded a net decrease of 116 previously disadvantaged men
and women in employment in total across the categories of specialised/
skilled/senior supervisory, middle management, and senior management
positions. The reduction at these levels will be addressed during the
next financial year with targeted interventions to ensure that the Group
meets its objective of being an employer of choice by 2019 in terms of
employment equity.
The O&L Group aims to create a feasible and flexible strategy that addresses
work-related employment barriers and the expectations of employees
in designated groups, namely the racially disadvantaged, women, and
persons with disabilities.
At the same time, the Group recognizes the shortage of skills in Namibia
as well as the ambitions and aspirations of current and future non-
designated employees. Therefore in implementing its Affirmative Action
Plan, the Group will not unfairly discriminate against any employee who
does not belong to a designated group as defined in the Affirmative
Action (Employment) Act (Act 29 of 1998). The Group’s Affirmative Action
Plan ensures that equity is achieved within the organisation in line with this
plan’s objectives.
SUSTAINABILITY
72
SUSTAINABILITY
73
Employee Turnover
O&L measures and monitors employee turnover on a quarterly basis;
the Group also conducts exit interviews with all employees who leave
the Group. The objective of exit interviews is to understand employees’
motivations for leaving and, if possible, implement remedial measures
where necessary to reduce further loss of personnel. This process gives
the Company an opportunity to make meaningful evaluations in terms
of a particular job or work position, the personnel, and its OpCos. It also
enables the Group to understand how best to ensure job satisfaction in
the future and retain employees. A total of 842 employees (compared to
1,016 employees in the previous year) exited the Group. The graph below
indicates the various employee turnover categories.
The total employee turnover rate for the Group in FY17 amounts to
13.6% (compared to 15.9% and 16.3% for the 2015 and 2016 reporting
periods respectively). This rate is based on the permanent employees on
the Group’s payroll at the end of the financial year. The Group regards this
as a reasonable turnover rate given the fact that it covers all categories
of job terminations.
Turnover figures for the reporting period are dominated by resignations
(at 52%) and dismissals (at 34%), with the highest turnover being
experienced in the retail and information technology sectors. Reasons
given for resignation were mostly related to employees taking up
better job offers or leaving to further their career or studies. There
were 48 voluntary redundancies during the period under review. These
redundancies arose primarily from the closure for refurbishment of the
Otjiwarongo Model Pick n Pay store. Once this store reopens, preference
will be given to these employees for re-employment.
TALENT, LEARNING AND DEVELOPMENT
Leadership and Employee Development
O&L World
O&L World is a 3-day leadership development programme hosted every
month for all employees of the Company, as well as external participants.
At this event the O&L culture, Purpose, Vision, Values and breakthrough
thinking are embedded by the Chairman and the Human Capital Director.
The plan is to cover all 6,000+ employees by the end of 2019.
Breakthrough Management Skills and the Leadership Foundation
Programme
Breakthrough Management Skills and the Leadership Foundation
Programme are two leadership initiatives aimed at building a breakthrough
culture and equipping attendees with the management and leadership
skills that they require to operate to their full potential within the Group.
Fifty-one leaders attended Breakthrough Management Skills training
during the year under review. Ninety-two employees received their
completion certificates from the Leadership Foundation Programme.
Talent Attraction Programme
The Talent Attraction Programme focuses on attracting and retaining
dynamic Namibian graduates from local and international universities and
technicons who display the passion and potential to be developed into the
future leaders of the O&L Group of Companies.
This year the programme celebrated its 10th anniversary and over the past
decade it has emerged as one of the O&L Group’s great success stories,
with this reporting year seeing its highest intake (13 graduates in various
fields) since it began. The Talent Attraction Programme has had a retention
rate of 61% since its inception in 2008, with various graduates from this
programme currently in senior leadership positions across the O&L Group
of Companies.
Hangana Seafood
Hangana ensures improved performance and world-class quality in
the fishing Industry through regular quality-assurance and food-safety
training events. The company focused on generic training, quality
assurance training, production management programmes, and statutory
training in the year under review. Total Production Management Training
is a key focus area and aims to eliminate waste and improve efficiencies
and productivity.
Hangana also hosted internships and job attachments for students
studying in various fields during the year under review.
Dimension Data
Dimension Data continues to gain momentum in developing young
talent in the Information Technology Industry for Namibia. A total of 25
employees participated in different upskilling training throughout the
reporting period, in fields of IT and Administration.
Dimension Data Namibia has taken in 6 new students from the racially
disadvantaged group. The students are enrolled into the fulltime
program for which Dimension Data Namibia carries the cost. Dimension
Data Namibia also took in 5 external interns who are in the process of
completing their certification in IT at the Namibian University of Science &
Technology (NUST).
The company increased its efforts in training and development, as to
ensure that all employees can be integrated as qualified professionals into
the Namibian IT sector, however a strong effort has been made to upskill
potential candidates from outside the company, which will benefit the
Namibian IT sector in the long term.
REDUNDANCIES 48
RETIRED 34
RESIGNED 439
DISMISSAL 291
OTHER (Contract Ended/Deceased/Disabled/Retired) 30
EMPLOYEE TURNOVER 2016/17
SUSTAINABILITY
74
SUSTAINABILITY
75
The Group spent N$ 12.65 million on training interventions during the
reporting period, which is 1.29% of total payroll compared with 1.14% in
the previous period (with the benchmark set at 1%).
EMPLOYEE ENGAGEMENT
At the time of the launch of the Mwenyopaleka Programme in 2004, the
unique ‘company culture’ of the O&L Group of companies was born, with
the main objective of the programme being to instil the Group’s Purpose,
Values and Vision (as well as the associated behaviours) in the hearts and
minds of all employees within the Group. The Mwenyopaleka Programme
has therefore allowed the Group to promote and communicate these
objectives to a large number of its employees over the 13 years since it
was launched.
More recently, in 2013 the employee engagement function was established
as part of our Vision 2019 communication strategy − which continues to
empower our people by developing their personal connection to our
Purpose, Values and Vision; leveraging the corporate brand by building
a sense of belonging and ambassadorship in employees; and creating a
breakthrough environment for all those who work for the Group.
The Employee Engagement Initiative is a principal means by which we
can facilitate our connection with employees. Its activities currently
include: communication and leadership development; utilising electronic
newsletters; the Touch 6000 employee connection campaign; O&L value-
based posters; regular engagement sessions with all employees; road
shows; the Value Star Recognition Programme; specialised engagement
facilitation; SMS communication; and internal publications that go out
to all employees to acknowledge the role that their achievements and
contributions play towards the Group becoming ‘The most progressive
and inspiring company’ by 2019.
The biggest employee event is the annual series of Mwenyopaleka road
shows and in 2017 these road shows were hosted for the 13th time in
seven towns countrywide. Approximately 4,894 employees attended
under the theme ‘Connect to 2019’, which gave our employees more
insight into topics such as the O&L Legacy, ‘leading the Values’, ‘What is
breakthrough?’, the O&L Ambassadors, and our 2019 Vision metrics.
In October 2016, the O&L Group decided to participate in the Great Place
to Work® (GPTW) assessment as part of its commitment to continuing to
create ‘the most progressive and inspiring company’. The Group chose the
Great Place to Work® Institute as our strategic partner in this enterprise as it
has 25 years of experience worldwide in analysing workplaces. The Institute
conducts research and recognizes leading workplaces in more than 50
countries on six continents, representing about 10 million employees in
around 6,000 organisations of varying size, maturity, and structure across
a wide range of industries. From these results, great workplaces are ranked
on various lists such as the Fortune’s 100 Best Companies to Work and the
Forbes Africa’s 100 Best Companies To Work For.
This evaluation is an important way to measure how we are progressing
in achieving our breakthrough Vision 2019 metric ‘Employer of choice’
and also how successfully we are bringing our Purpose, ‘Creating a future,
enhancing life’, to fruition. Furthermore, we are able to benchmark
ourselves against the best workplaces across the world through the GPTW
assessment process in order to improve on our current practices, ensuring
they support a breakthrough performance culture whereby employees
are able to purposefully produce breakthrough everywhere.
As a Group, O&L achieved an GPTW Employee Trust Index score of 68%
compared to 88% in the Top 100 Global Companies of similar size (between
2 501 to 5 000 employees) and 87% in the Top 100 Global Companies
(irrespective of size).
Kraatz Marine
Over the reporting period, 19 students from the Namibia Institute of
Mining and Technology (NIMT) joined Kraatz Marine as apprentices. These
students were given the unique opportunity to be mentored and coached
by master craftsmen who have worked in the engineering sector for many
years and who possess a wealth of experience locally and internationally in
fields such as boiler making, welding, and fitting and turning.
Kraatz Marine employees attended various other training interventions,
such as Helicopter Underwater Escape Training, Safety, Health and
Environmental Representative training, First Aid qualifications, Fire watch,
Rigging, and Relationship Systems Coaching.
Namibia Dairies
This year, Namibia Dairies provided both formal and informal training to
employees and once again financially supported some of them in their
professional development studies in various fields. Other employees
participated in the Namibia Training Authority (NTA) National Certificate in
Wholesale and Distribution. Namibia Dairies also provided NIMT apprentices
with the opportunity to gain hands-on technical skills in a practical work
environment.
Namibia Breweries
Namibia Breweries employees participated in various development
programmes and vocational education and training courses over the
reporting period and some also followed degree studies. In addition,
the company financially supported employees through study loans and
internal bursaries. The Apprentice Brewer Programme remains one of
our most notable initiatives for growth with apprentice brewers taking up
permanent roles with the company. Some employees were also enrolled
in the National Certificate in Wholesale and Distribution (Level 2).
Namibia Breweries continues to support students through bursaries
offered to those attending class at the Namibia Institute of Mining
and Technology (NIMT). Namibia Breweries also granted additional job
attachments to students in various technical fields.
O&L Leisure
O&L Leisure hosts its own in-house development programmes, with the
purpose of taking training and development opportunities to its people
at the individual properties, thus giving them an opportunity to engage in
learning while working so that they can identify the practical applications
of their training directly in the workplace setting.
We recently signed MoUs (Memorandum of Understanding) with the
Namibia University of Science and Technology (NUST) and the University
of Namibia (UNAM) that will allow outstanding students at the NUST Hotel
School to join the company as interns.
Broll and List Property Management Namibia (BROLL)
Broll employees attended various Group development initiatives
throughout the year. External SAMTRAC training (Occupational Health and
Safety) added value to the current service offerings within the Facilities
Department.
Model PnP Namibia
Model PnP Namibia offers several development and growth opportunities
to its employees, such as leadership training, health and safety courses,
customer service courses, and operational training. Another of these
opportunities is the Retail Trainee Manager Programme, which PnP offers
to internal employees and certain graduates in order to develop their
aptitudes for future leadership positions within retail. After graduating
from this programme, the employee/graduate will have gained the
knowledge and skills to apply for an Assistant Store Manager position
within PnP.
SUSTAINABILITY
76
SUSTAINABILITY
77
EMPLOYEE WELLNESS PROGRAMME
The Ohlthaver & List Group Wellness Programme is committed to the
overall wellbeing of all employees through the excellent wellness and
support services it provides. The Group’s Mission in this regard is to
enhance and sustain its employees’ wellbeing.
The Group is dedicated to providing employees with reliable and
professional wellness services in order to promote physical, emotional,
and social wellbeing. The programme thus promotes the employees’
health and wellbeing, improves staff morale, and creates a supportive
environment for those wishing to make personal lifestyle changes.
The Wellness Programme is also a resource for managers and supervisors,
benefiting the Group by improving productivity, reducing injuries and
illnesses, reducing absenteeism and lost work time, and creating a culture
of health.
The Wellness Programme is guided by seven core principles that aim to
create a great place to work and a culture of employees who are healthy,
happy and motivated:
Wellness Programme initiatives undertaken over the reporting period
include:
- HIV Management Programme
- Absenteeism Management Programme
- Psycho-social support services, i.e., counselling services, crisis
intervention, and trauma-defusing services
- Regular wellness site visits
- Wellness education and awareness
- Wellness screenings
- Voluntary counselling and testing
- Prostate cancer screenings
- Celebration of national and international health and wellness days
- Wellness care and support
- Wellness training
The O&L Group has received the GPTW Certification seal, which indicates
the high levels of trust prevalent across our operations, levels that result
in strong employee engagement and that are a reflection of great work
practices. This Seal of Excellence is only issued to companies that have
achieved a certain threshold in terms of employees’ positive feedback and
experiences in the workplace.
O&L has committed to continue participating in the GPTW survey. The Group
will also continue to implement the results emanating from the survey to
increase employee engagement and trust levels in the organization.
OCCUPATIONAL HEALTH AND SAFETY
During the period under review, the Group conducted in-house audits
at all OpCos to determine their adherence to the Group Risk Control
Standards. These standards are based on international best practices in
the occupational health and safety field and were developed to ensure
compliance with national legislation and regulations.
During the past financial year, a process to review the standards was
initiated in order to integrate the Health and Safety standards and systems
with those of Environmental Management, in order to improve service
and streamline operations.
During the past year the Group DIFR (Disabling Injury Frequency Rate) has
decreased by 0.191 compared against the previous year. The DIFR has now
decreased for the fourth year in succession, indicating the value of the
adoption of stringent standards and increased monitoring and inspection.
During April 2017, the Group celebrated World Safety Day for the first time,
with a Group-wide awareness campaign aimed at improving the rate of
incident reporting. During this campaign, all sites across the Group hosted
training sessions aimed at increasing employees’ understanding with
regard to the need for reporting incidents in a timely manner, as well as
the type of incidents that need to be reported. This initiative is aligned with
the activities of the International Labour Organisation’s to promote Health
and Safety in the Workplace.
O&L GROUP DISABLING INJURY FREQUENCY RATE 2014 - 2017
1.20
1.00
0.80
0.60
0.40
0.20
0.00
Ju
l
Au
g
Sep
Oct
No
v
Dec
Ja
n
Feb
M
ar
Ap
r
M
ay
Jun
2013/2014 2014/2015 2015/2016 2016/2017
PREVENTATIVESERVICES
CASEMANAGEMENT
WELLNESSTRAINING
ORGANISATIONALCONSULTATION
STAKEHOLDERENGAGEMENT
MARKETING
MONITORING& EVALUATION
SUSTAINABILITY
78
SUSTAINABILITY
79
AWOL 4.6%
SOCIAL SECURITY LEAVE 10.3%
PAID SICK LEAVE 63.4%
UNPAID SICK LEAVE 9.7%
COMPASSIONATE LEAVE 8.2%
INJURIES ON DUTY 3.8%
ABSENTEEISM
The Group’s absenteeism rate during the year under review was 2.42%,
well above our 1.75% target absenteeism rate. This shows an increase
in the rate from 2.13% in 2016 (numbers have been restated due to
redefinition of categories). The Group is unsure of the reasons for this
increase but assumes that this can be ascribed in part to more rigorous
capturing of absenteeism data. This will be closely monitored over the
next financial year.
The Ohlthaver & List Group is committed in improving the health,
wellbeing and attendance of all employees. The Group recognises that
employees are likely to be absent from work due to sickness or ill health
at some point in their lives and it is important that appropriate procedures
are in place to support employees during these periods, as well as to
manage and monitor absences. The Group has developed an Absenteeism
Management Programme to have appropriate procedures in place to
manage and monitor absences. The programme will be implemented as
from 1 July 2017.
The Ohlthaver & List Group Wellness Programme also continues to
implement various prevention and intervention programmes such as
health education and awareness interventions; psycho-social support
services i.e. counselling services, crisis intervention, and trauma-defusing
services; as well as training on absenteeism management for both
employees and management. These programmes and services focus on
the employees’ physical, psychological, social, spiritual and organisational
wellbeing with the aim of reducing absenteeism.
CORPORATE SOCIAL INVESTMENT
In bringing the O&L Group Purpose to life through its corporate social
investment (CSI) initiatives, the Group invested in excess of N$12.3 million
in community initiatives during the period under review, well above the
1% of net profit set as our benchmark (consistent with international
benchmarks).
Supported by the OpCos, CSI initiatives driven at the O&L Group-level
focused primarily on education and skills development as key enablers of
community upliftment. Joint initiatives funded over the reporting period
by all the OpCos include the following (among others):
- Building two containerised classrooms and a soup kitchen for 440
learners of the Monte Christo Primary Project school in Havana, Katutura.
These modern classrooms are built from refurbished containers with
the aim of relocating them to new premises for the school when the
allocated land has been fully serviced by the local authority.
- Ongoing general support ranging from product donations to
distribution of teaching aids and school bags, benefiting approximately
2,232 orphaned or vulnerable learners at the Monte Christo and Moses
Garoëb Primary Project schools in Havana, Katutura.
- Various other initiatives in support of education − such as the donation
of 36,080 m2 of land to the Otavi Primary School, and financial support
towards the Etunda Farm School in the Otjozondjupa Region.
In addition to the above, further FY17 CSI highlights by the O&L Group
OpCos include the following:
Broll and List Property Management Namibia (BROLL)
In addition to providing office and exhibition space to various charitable
organisations, Broll also initiated numerous projects to further enhance
education for the learners at Monte Christo and Moses Garoëb Primary
Project schools.
Dimension Data
Dimension Data continued its support of orphaned and vulnerable
children, as well as its investment in skills development, producing four
graduates from the Exponential Training (XT) Programme during the
period under review.
Hangana Seafood
In addition to Hangana’s monthly fish donations to various charities −
and in particular homes for children with disabilities, orphans, and the
elderly − Hangana also provided bulk donations of canned fish to assist the
communities affected by drought in Otjimbingwe, Opuwo and Tsumkwe.
Kraatz Marine
The Learn to Weld Programme continued to provide young Namibians with
basic welding and other valuable skills, in order to enhance employment
prospects among the unemployed youth in the Erongo Region, allowing
three welders to graduate during the period under review.
Namibia Breweries Limited
Namibia Breweries continued to invest heavily in the communities in which
it operates, increasing its focus on promoting responsible drinking and
managing environmental resources through strategic partnerships with
key stakeholders.
Core projects supported during the year under review include the DRINKiQ
initiative, which saw an additional 1,300 people trained on the impacts
of alcohol consumption, as well as the Condom Distribution Project and
the Blow the Horn on Rhino Poaching initiative. In addition, NBL donated
a two-seater aircraft to the Intelligence Support Against Poaching (ISAP)
project in February 2017. This aircraft, known as The Protector, will be used
for tracking collared rhino, locating poachers, providing air support for
ISAP, as well as patrols in national parks and private reserves.
PERSONNEL ABSENTEEISM 2016/17
SUSTAINABILITY
80
SUSTAINABILITY
81
ENVIRONMENTAL SUSTAINABILITYThe commitment of the O&L Group to the environment is entrenched in
its Value: ‘Naturally today for tomorrow’ as well as its 20% carbon footprint
reduction Vision metric. To this end, appropriate policies and procedures
have been developed based on ISO 14001 requirements to ensure that
environmental impacts are determined, regulatory requirements are
met, and suitable environmental practices are applied. The Group believes
that protection of the environment and our natural resources is critical
in the future sustainability of businesses and Namibia as a whole. The
Group continues to embrace a multi-stakeholder approach in promoting
sustainable environmental practices in and beyond its business.
ENVIRONMENTAL PRECAUTION
The O&L Group Risk Management System makes provision for the
assessment of potential risks that operations − and especially new projects
and business expansions − may have on the environment. In cases where
risks are identified, measures are taken to avoid the risk and if a feasible
alternative is not available, to actively mitigate the risks so as to reduce
them to an acceptable level. Environmental impact assessments are
conducted for projects that fall under the ambit of the Environmental
Management Act (Act 7 of 2007).
ENERGY AND WATER CONSUMPTION
Electricity, fuel and water are key resources in the O&L Group’s production
and conversion processes.
Electricity supply during the previous two reporting periods has improved
somewhat, with the national electricity supplier having secured medium-
term contracts with neighbouring countries. However, the cost of
electricity remains a material issue, especially in the retail and production
sectors of our business.
The water shortage −especially in the central regions of Namibia −as a result
of the drought has compelled the Group to explore and implement critical
alternative supply and water-savings initiatives. Namibia Breweries Limited
has managed to extract approximately 27% of its water requirement from
on-site boreholes and in addition to water saving, reuse and recycling
initiatives, the Group is proud to announce that the 30 - 40% savings
enforced by the local authority (City of Windhoek) were met in its brewing,
dairies and properties management sectors during the reporting period.
RAW MATERIAL PROCESSED
2013/14 2014/15 2015/16 2016/17
Malted barley for brewing tons 30 662 31 023 29 108 29 124
Fish landed tons 12 615 10 003 11 373 10 094
Fish processed tons 13 409 11 176 12 445 12 629
Milk intake, own production ex !Aimab liters (‘1000) 15 555 15 137 14 341 13 749
Milk intake: local producers liters (‘1000) 7 833 8 925 9 788 9 603
Milk powder converted tons 405 678 328 301
Concentrates/pulps converted tons 1 064 1 269 1 439 1166
(The Group’s packaging material scope is extremely diverse and complex and the exact usage has not been determined)
Namibia Dairies and Windhoek Schlachterei
In addition to continuing with regular and ongoing donations of dairy
and meat products to long-standing CSI beneficiaries, Namibia Dairies
successfully launched a programme to develop emerging communal
farmers by empowering them with dairy-specific skills in order to support
the growth of Namibia’s dairy industry. The first year of the Dairy Industry
Development Programme delivered five graduates who will continue to
benefit from further mentoring and coaching.
O&L Leisure
While O&L Leisure continued to support the development of young
journalistic talent in partnership with Namibia Media Holdings, various
sponsorships were made available in support of school fundraisers as well
as conservation initiatives.
Model Pick n Pay
The community upliftment initiatives driven by each of Pick n Pay’s 22
stores throughout the country were further complemented by the
company’s support to environmental initiatives in partnership with the
Recycle Namibia Forum (RNF). As well as supporting recycling awareness
and raising funds for the RNF through the sale of Pick n Pay cloth bags, the
company was also the first retailer to support battery recycling in Namibia.
SUSTAINABILITY
82
SUSTAINABILITY
83
THE ENERGY AND WATER INTENSITY AND EFFICIENCIES
Energy and water efficiencies have shown mixed results across our
operations when compared against the previous reporting period.
Electricity efficiency at Hangana Seafood improved as a result of increased
production volumes and savings initiatives. However, water efficiency
at the same operation decreased as a result of the improved cleaning
methods initiated in order to counter possible quality and food safety
risks.
Water efficiency at Namibia Breweries Ltd and Namibia Dairies Ltd improved
significantly due to water-saving measures. Electricity efficiencies at
Namibia Breweries Ltd still remain a huge challenge because of the
significant reduction in production volumes that began in 2012 – 13, as
well as the recent installation of additional water extraction and wood chip
boiler auxiliary equipment.
Electricity efficiencies in the retail sector have come under pressure with a
number of new and refurbished stores not having achieved their optimal
potential. The O&L Group is nevertheless confident that efficiencies are
well within industry benchmarks and continue to exceed our expectations.
Some selected energy and water efficiencies are reflected in the below
table:
WATER, FUEL AND ELECTRICITY CONSUMPTION
2013/14 2014/15 2015/16 2016/17
Hangana Seafood
Fishing vessels fuel efficiency l/ton landed 575 533 502 509
Electricity efficiency kWh/ton processed 946 1036 936 916
Water utilisation m3/ton processed 16.2 17.3 17.6 18.4
Namibia Breweries
Electricity efficiency (incl. solar) kWh/hl packaged 8.96 9.24 9.46 9.73
Water utilisation (incl. boreholes) hl/hl packaged 4.91 4.76 4.42 4.27
Heating efficiency MJ/hl packaged 65.2 64.9 70.2 61.9
Namibia Dairies (Avis production facility restated)
Electricity utilisation kWh/l product produced 95.2 86.5 92.6 98.4
Water utilisation l/l product produced 3.52 3.34 3.22 2.69
Heating efficiency l HFO/l product produced 20.46 19.70 20.07 20.36
O&L Leisure (Midgard/Mokuti only)
Electricity efficiency kWh/guest night 36.2 32.1 32.3 34.6
Model Pick n Pay
Electricity efficiency (comparable stores) kWh/product sold 193 182 173 204
WATER, ELECTRICITY AND FUEL CONSUMPTION
Electricity consumption throughout the Group has increased by 6.3%
compared to the previous reporting period as a result of new additions
in our retail sector as well as operations at the Strand Hotel Swakopmund.
Potable water consumption (municipal and desalinated) has decreased
significantly (by 20%) due to savings initiatives in our brewing and dairy
operations but increased in the fishing sector as a result of improved
cleaning regimes. Use of heavy furnace oil (HFO) for heat energy decreased
by 42% as a result of the success of the biomass boiler installed at Namibia
Breweries Ltd. Use of fuel on our fishing vessels was also reduced whilst
fish-meal furnace-fuel use increased.
WATER, FUEL AND ELECTRICITY CONSUMPTION
UOM 2013/14 2014/15 2015/16 2016/17
Electricity kWh 63 129 842 61 226 237 65 299 094 69 447 715
HFO for heating liter 4 154 172 4 135 132 4 128 435 2 408 500
Fuel for fish-meal furnaces liter 537 108 448 704 578 533 87 140
Fuel for fishing vessels liter 7 258 958 5 327 779 5 714 706 5 137 797
Fuel for secondary transport and other applications liter 1 677 406 1 705 605 1 765 483 1 989 104
Water: municipal (potable) m3 1 513 568 1 368 723 1 255 999 1 004 569
Water: desalinated m3 103 029 97 740 89 703 91 661
Water for agronomy m3 4 169 126 3 664 238 3 028 195 3 299 826
Water from boreholes (estimated) m3 90 000 100 000 138 487 349 287
SUSTAINABILITY
84
SUSTAINABILITY
85
The O&L Group’s actual carbon footprint has decreased by 1.1% across
operations compared to the increase of 7.2% reported during the previous
reporting period. This FY17 decrease can mainly be ascribed to a decrease
in the use of heavy furnace oil at Namibia Breweries Ltd, with this fossil
fuel being partially (50%) replaced by a renewable biomass (wood chips) for
fuel. There has also been a decrease in vessel fuel use at Hangana Seafood.
However, additional retail stores − as well as the addition of the Strand
Hotel Swakopmund and Chobe Water Villas − have added to the Group’s
carbon footprint. So compared to the base year of 2012/13, the Group’s
actual carbon footprint has decreased by 10.5% and by 11% if volume
fluctuations are taken into account. The Group is confident that its 20%
carbon footprint reduction Vision metric will be achieved once the biomass
boiler at Namibia Breweries Ltd reaches its full potential, the biogas plant at
the !Aimab Superfarm becomes operational, and energy-savings initiatives
are more fully implemented.
Note: Scope 3 (indirect) elements of the Greenhouse Gas Protocol have
not been established by the O&L Group, but it is assumed that these are
dominated by fuel used in the primary distribution (an outsourced function)
of raw materials, packaging materials, and final products consumed. The
impact of ozone-depleting gases and nitrates and sulphides (NOx and SOx)
has also not been determined.
The Group has revisited its energy-savings strategy and our focus will now
be on:
- Increased employee and management awareness;
- Process optimisation to increase efficiencies; and
- Solar (photovoltaic) power installations.
CARBON FOOTPRINT
The O&L Group fully recognizes the impact its activities have on the
environment and, in particular, how these activities can contribute to
climate change.
The O&L Group’s carbon footprint (scopes 1 and 2 of the Greenhouse Gas
Protocol) is dominated by electricity consumption in its manufacturing
and retail operations, heavy furnace oil (HFO) used in generating heat in
the beer and soft drink and milk/juice sectors, and fuel consumption in
the fishing sector.
HFO FOR HEATING 6%
FUEL FOR FISHING VESSELS 12%
ELECTRICITY 72%
OTHER FUEL/GASES 7%
METHANE 3%
CARBON FOOTPRINT CONTRIBUTORS 2016/17
OTHER 1%
O&L LEISURE 6%
MODEL PICK N PAY 27%
NAMIBIA BREWERIES LTD 26%
HANGANA SEAFOOD 26%
SEGMENT CONTRIBUTION TO CARBON FOOTPRINT 2016/17
NAMIBIA DAIRIES 14%
O&L GROUP CARBON FOOTPRINT (tons CO2e)
110 000
100 000
90 000
80 000
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19
Group actual O&L Group adjusted for volumes Target
SUSTAINABILITY
86
SUSTAINABILITY
87
During the past year, the Group also celebrated World Environment Day by
engaging employees in an arts and crafts competition aimed at increasing
employee interaction with the environment. Awareness sessions with the
Snake Conservation Association of Namibia were also held at various sites
where the potential for human-snake conflict exists.
WASTE MANAGEMENT AND RECYCLING PROGRAMMES
The O&L Group’s ongoing drive to inculcate a culture of integrated
waste management and environmental consciousness at the workplace
continues to result in all solid waste generated at major business operations
being managed in line with national best practice.
Registered waste-management contractors are contracted to handle the
waste being generated at our operations and where there are no private
contractors available, municipal services are utilised to deal with waste −
for example in smaller towns and settlements. Where specialised waste-
handling services are required, reputable contractors are contracted to
deal with more hazardous wastes.
A detailed waste-stream assessment was carried out for all operations and
the highest proportion of waste (in terms of weight) was subsequently
found to be generated through production processes.
The aim of waste management at the OpCos is to minimise the amount
of waste going to landfill through the optimisation of recycling potential
and a reduction in total waste volumes produced. Currently, on-site waste
generation information is only available for NBL and Namibia Dairies: for
the year in review, 45% of all waste generated at Namibia Dairies was
recycled (up 5% from the previous year). For NBL the amount of waste
recycled has remained stable at about 80% for the past two years.
A process is currently being established that will also ensure that more
accurate data for waste generated is available to OpCos, thus allowing them
greater oversight in terms of setting waste-management targets at their
sites. Efforts have also been made to utilise organic waste. For example,
spent grain from NBL is used as cattle feed at the !Aimab Superfarm and
organic dairy waste and food waste is donated as pig feed. At Hangana
Seafood, fish offal is processed into fishmeal.
Effluent discharge volumes in the Windhoek area have decreased as a
result of our water-savings initiatives. Three major and two minor incidents
were recorded at Namibia Breweries and Namibia Dairies respectively
where effluent discharge quality did not meet the required regulatory
standards, however; an objection − based on the appropriateness of the
sampling methods applied − has been lodged against the penalties that
resulted and this is currently under review.
CARING FOR OUR ENVIRONMENT
During this reporting period, O&L Group once again supported various
clean-up campaigns throughout Namibia through the Recycle Namibia
Forum (RNF); we are also playing an integral role in the development
of activities that will assist the organisers of clean-up campaigns in
maximising their recycling potential. Through RNF, the Group is also
continuing to engage with government on issues related to sustainable
waste management on a national and strategic level.
Through it’s OpCos, the Group also supported various organisations’
efforts aimed at preserving our natural resources including (among
others) sponsorship of the clean-up campaign, Project Shine, as well as the
Intelligence Support Against Poaching (ISAP) project – one of the biggest
campaigns to date aimed at gathering information related to poaching
activities and successful prosecution of offenders.
Continued education and awareness-raising initiatives during the year
ensured that addressing the impacts of the recent water crisis across
Namibia remains a priority issue for the Group. Close relationships were
established with the relevant stakeholders in order to ensure that the
Group can be pro-active and play a leading role in ensuring that water
savings can be maintained for as long as water shortages remain a pressing
national concern.
REPORTS
88
REPORTS
89
ASSURANCE OBJECTIVES AND RESPONSIBILITIES
The primary objectives of the assurance process, and the responsibilities
of Sustainability Consulting in this regard, are to provide O&L’s stakeholders
with an independent ‘moderate level assurance’ opinion on whether:
- The sustainability content of the O&L report adheres to the principles
of Inclusivity, Materiality and Responsiveness;
- Specific data reported by O&L related to selected sustainability
indicators meets reasonable tests for accuracy, consistency,
completeness and reliability; and
- The report complies with the requirements of the Global Reporting
Initiative (GRI) G4 “Core” Level Reporting Guidelines.
In the execution of this assurance assignment, it was the responsibility of
O&L to provide Sustainability Consulting with appropriate levels of access
to relevant information, systems, sites and individuals required to fulfil
these objectives. It is the opinion of Sustainability Consulting that the
Company executed this responsibility to the degree required for the
assurance assignment to be successfully executed.
ASSURANCE APPROACH AND LIMITATIONS
The process applied in developing this assurance statement is based
on the AA1000AS (2008) principles of Inclusivity, Materiality and
Responsiveness, the GRI G4 Reporting Guidelines, and all other relevant
best practices in the field of sustainability reporting and assurance.
In this regard, Sustainability Consulting’s approach to the assurance
engagement included the following:
- A review of sustainability measurement and reporting procedures in
place at the O&L Head Office;
- A review of the processes applied by the company in the determination
of Material Aspects (as defined by the GRI G4 Reporting Guidelines) and
the identification of key stakeholders groups;
THE BOARD, MANAGEMENT AND OTHER STAKEHOLDERS OF
OHLTHAVER & LIST:
Sustainability Consulting was commissioned by Ohlthaver & List (hereafter
O&L) to provide Independent Third Party Assurance over the Company’s
Integrated Annual Report covering the period 1 July 2016 to 30 June 2017.
ASSURANCE STANDARD
As has been the case for the O&L Integrated Annual Reports in the preceding
two years, the assurance engagement was conducted according to a Non-
Aligned assurance model. As such, the engagement was not conducted in
strict accordance with any particular assurance standard.
At the same time, the assurance engagement was conducted with
particular consideration of the principles of Inclusivity, Materiality
and Responsiveness, which serve as the guiding principles of the
AccountAbility AA1000S (2008) Assurance Standard.
The assurance engagement was conducted with due consideration of
any inherent limitations related to the collection, collation, sampling
and analysis of various types of non-financial data included in the O&L
Integrated Annual Report.
INDEPENDENCE
It is confirmed that during the past year, Sustainability Consulting has
not provided O&L with any form of advisory services, or undertaken any
commissions for the Company, that might in any way compromise the
independence of the assurance process. Sustainability Consulting has also
not been responsible for the preparation of any part of the Integrated
Annual Report. Consequently, Sustainability Consulting remains an
independent assurer over the content and processes pertaining to this
Report.
ASSURANCE STATEMENT
- A review of the approaches adopted by the Company to management
of these Material Aspects and engagement with key stakeholders;
- An in-depth review of the accuracy, consistency, completeness and
reliability of samples drawn from the information and/or data
collected, collated and reported on by O&L in its 2017 Integrated
Annual Report, both within the Company’s Head Office and at selected
sites in the Group’s operating companies.
INDICATORS ASSURED
In addition to the review of Material Aspects and key stakeholder groups,
the following elements and their corresponding indicators, drawn from
the GRI G4 Reporting Guidelines, were subject to assurance:
Governance processes
- Risk Management
- Regulatory Compliance
Human Capital
- Skills shortages
- Vacancy rates
- Employee turnover
- Employee training / skills development
Environmental Indicators
- Water consumption and mitigation
- Energy consumption and mitigation
- Greenhouse gas emissions
The assurance assignment further served to confirm that that the report
effectively addresses all indicators required to conform to the GRI G4
Guidelines for a “Core” Level report.
The assurance process was limited to the disclosures made in the O&L
Integrated Annual Report for 2017, and to a review of relevant policies
and procedures related to the indicators described above.
It did not extend to engagement with any stakeholders other than
relevant company employees and management representatives
responsible for the indicators under review.
FINDINGS
The assurance process determined that O&L’s sustainability reporting
processes remain appropriate to the level of governance applied by the
Group. Furthermore, these processes appear to be subject to continuous
development on an ongoing basis, with the result that they appear
considerably more advanced than is the norm amongst the majority of
Namibian corporate entities.
It is further noted that:
- The Company’s systems for the data collection, collation and reporting
of sustainability data are well-established and subject to continuous
development; as a result, these systems provide effective support for
the management of sustainability-related issues.
- All site-specific data evaluated was found to be reasonably accurate
and/or reliable.
- O&L’s reporting processes appear to effectively reflect the AA1000AS
(2008) principles of Inclusivity, Materiality and Responsiveness.
- The Report appears to adequately meet the requirements of the
GRI G4 Reporting Guidelines for a “Core” Level Report, with adequate
responses provided for all Standard Disclosures, as well as for
Disclosures on Management Approaches to Material Aspects.
CONCLUSIONS AND RECOMMENDATIONS
Based on the information reviewed during this engagement, Sustainability
Consulting is confident that the Report provides a comprehensive and
balanced account of O&L’s management of its identified Material Aspects
and key stakeholder groups, as well as of its performance in the context
of financial and non-financial sustainability, for the period under review.
REPORTS
90
REPORTS
91
The data reviewed is generated through a systematic process, and
accurately represents the Company’s ability to manage and report on
all aspects of its sustainability performance, while conforming to the
AA1000AS (2008) principles of Inclusivity, Materiality and Responsiveness.
Moreover, the fact that the Company’s data management systems have
been operational for a number of financial years, provides increasing
opportunities for in-depth analysis of trends and developments in areas
related to sustainability performance.
The following areas have been identified as requiring further consideration
or actions:
- Over the next several months, the GRI G4 Reporting Guidelines will be
phased out, and will be replaced with the Comprehensive GRI
Reporting Standards. These standards will be required for all reports
published on or after 1 July 2018. It is therefore recommended that
relevant senior management representatives within O&L, along with
those representatives of the Company responsible for the
management of the Group’s sustainability-related data management
and the preparation of the Integrated Annual Report, familiarise
themselves with the Comprehensive Reporting Standards. Such
familiarisation is likely to prove particularly valuable in the preparation
of the Group’s Integrated Annual Report for 2018.
- With regard to future activities related to the assurance of O&L’s
sustainability reporting activities, it is recommended that the
company considers undertaking such assurance activities in line with
accepted Independent Third Party Assurance standards such as the
AA1000AS (2008) or the ISAE3000 Accounting Standard.
For additional information regarding the processes and documentation
related to this assurance engagement, please e-mail info@
sustainabilityconsulting.co.za
For Sustainability Consulting
16 August 2017
UNTAPPED EARTH
SUSTAINABLE HARVESTS
REPORTS
94
REPORTS
95
2017 2016
N$’000 N$’000
Value retained
Profit for the year attributable to owners of the parent 163 351 329 366
Non-controlling interest 228 809 262 614
392 160 591 980
Total Wealth Distributed 3 222 591 3 011 747
1. Additional amounts collected on behalf of central and local government
Quota levies 6 583 5 855
Rates and taxes paid on properties 14 098 12 508
Customs and excise duties 680 369 580 555
Net Value Added Tax paid 276 089 157 399
Pay-as-you-earn tax (PAYE) deducted from remuneration paid 139 077 114 737
Non-resident shareholders’ tax (NRST) deducted from dividends paid 366 4 491
Withholding tax on services, interest and royalties 5 564 8 301
1 122 146 883 846
2017 2016
N$’000 N$’000
WEALTH CREATED
Value added by operating activities
Revenue 6 406 980 5 660 086
Paid to suppliers for materials and services (3 153 310) (2 893 634)
3 253 670 2 766 452
Value added by investing activities
Interest income 22 264 21 837
Fair value adjustments 97 646 230 377
Loss from equity accounted investments (150 989) (6 919)
(31 079) 245 295
Total Wealth Created 3 222 591 3 011 747
WEALTH DISTRIBUTED
To Pay Employees
Salaries, wages, medical and other benefits 1 005 833 931 840
To Pay Providers of Capital
Finance costs 223 505 196 700
To Pay Government
Income tax 114 552 135 367
Additional amounts collected on behalf of central and local government 1 1 122 146 883 846
1 236 698 1 019 213
To be retained in the business for expansion and future wealth creation:
Value reinvested
Depreciation, amortisation and impairments 307 244 232 241
Deferred tax 57 151 39 773
364 395 272 014
GROUP VALUE ADDED STATEMENT
REPORTS
96
REPORTS
97
2017 2016 2015 2014 2013 2012 2011
N$’000 N$’000 N$’000 N$’000 N$’000 N$’000 N$’000
Consolidated Statements of Financial Position
Property, plant and equipment 3 462 736 3 256 234 2 927 207 2 696 792 2 305 890 2 215 497 1 925 782
Investment property 1 980 714 1 845 382 1 589 504 1 429 946 1 310 316 1 109 364 980 758
Intangible assets 46 197 31 292 25 108 21 973 23 687 17 587 17 563
Deferred taxation 4 615 1 793 15 364 21 940 38 965 37 201 50 270
Non-current investments 492 454 656 266 76 331 13 511 22 265 29 364 26 928
Non-current biological assets 45 264 38 199 37 646 33 998 33 952 33 276 30 955
Non-current trade and other receivables 39 538 41 546 43 804 47 263 47 416 42 377 45 068
Non-current related parties 4 531 3 328 2 590 1 008 - 100 605 106 352
Current assets 1 638 377 1 437 774 1 341 657 1 166 259 1 226 587 1 095 102 937 363
Non-current assets classified as held for sale 53 898 1 425 4 500 6 375 17 479 23 934 5 796
Property units for sale 33 615 150 862 76 761 - - - -
Total assets 7 801 939 7 464 101 6 140 472 5 439 065 5 026 557 4 704 307 4 126 835
Equity attributable to owners of the parent 2 912 811 2 682 523 2 276 310 2 029 247 1 683 570 1 444 949 1 183 477
Non-controlling interests 1 215 781 1 042 756 886 737 806 271 715 908 746 314 655 256
Deferred taxation 513 095 454 164 417 065 385 732 294 562 252 747 236 695
Non-current interest-bearing borrowings 1 683 563 1 745 887 1 209 798 1 012 978 1 003 983 1 306 622 1 073 684
Deferred income 3 139 2 775 7 928 4 900 - - -
Non-current provisions 53 868 44 585 43 790 43 280 41 584 37 397 32 052
Non-current trade and other payables 6 500 5 656 4 784 3 362 3 449 5 380 3 653
Non-current related parties 7 604 16 907 28 273 10 636 12 506 14 149 9 139
Current liabilities 1 405 578 1 468 848 1 265 787 1 142 659 1 270 995 896 749 932 879
Total equity and liabilities 7 801 939 7 464 101 6 140 472 5 439 065 5 026 557 4 704 307 4 126 835
SEVEN YEAR REVIEW
2017 2016 2015 2014 2013 2012 2011
N$’000 N$’000 N$’000 N$’000 N$’000 N$’000 N$’000
Consolidated Statements of Comprehensive In-
come
Revenue 6 406 980 5 660 086 5 306 276 4 928 643 4 585 661 4 133 899 3 546 975
Operating profit after fair value adjustments and
gain on biological assets and agricultural produce
874 778 948 902 820 789 790 159 788 234 628 523 594 523
Finance costs (223 505) (196 700) (147 801) (144 249) (142 985) (134 087) (103 062)
Share-based payment expense - - - - - -
Equity losses from joint ventures and associates
(on-going operations)
(150 989) (96 131) (120 501) (116 489) (107 085) (90 515) (69 549)
Equity profit (loss) from joint ventures and associates
(deferred tax asset write down)
- 89 212 - - (188 089) - -
Income from investments 22 264 21 837 26 932 16 809 21 609 24 829 23 889
Profit before taxation 522 548 767 120 579 419 546 230 371 684 428 750 445 801
Taxation (130 388) (175 140) (168 547) (169 969) (139 844) (131 754) (104 305)
Profit for the year 392 160 591 980 410 872 376 261 231 840 296 996 341 496
Other comprehensive income for the year, net of tax 134 238 84 671 8 632 151 169 59 583 134 262 128 967
Total comprehensive income for the year 526 398 676 651 419 504 527 430 291 423 431 258 470 463
Profit attributable to:
Owners of the parent 163 351 329 366 229 881 231 438 180 969 144 383 192 554
Non-controlling interests 228 809 262 614 180 991 144 823 50 871 152 613 148 942
392 160 591 980 410 872 376 261 231 840 296 996 341 496
Total comprehensive income attributable to:
Owners of the parent 239 117 411 133 238 246 345 209 238 640 274 191 288 249
Non-controlling interests 287 281 265 518 181 258 182 221 52 783 157 067 182 214
526 398 676 651 419 504 527 430 291 423 431 258 470 463
REPORTS
98
REPORTS
99
The information below should be read in conjunction with the annual
financial statements for the year ended 30 June 2017, which is available
on the website.
GROUP OPERATING PERFORMANCE
Salient features
The salient features for the year under review are as follows:
% 2017 2016
Increase N$ ‘000 N$ ‘000
Revenue +13.2 6 406 980 5 660 086
Operating profit +8.2 777 132 718 525
Fair value adjustments -57.6 97 646 230 377
Operating profit after fair value adjustments -7.8 874 778 948 902
Equity losses from joint ventures and
associates (on-going operations) +2 082.2 (150 989) (6 919)
Net finance costs +15.1 (201 241) (174 863)
Profit before taxation -31.9 522 548 767 120
Taxation -25.6 (130 388) (175 140)
Profit for the year -33.8 392 160 591 980
FINANCIAL REVIEW
The 2017 financial year was a challenging year, with the subdued local economy impacting our businesses. It is during these periods that the strengths of having a diversified Group comes to the fore. We saw an excellent performance from Namibia Breweries locally and solid results from Hangana Seafood, our Property portfolio and O&L Leisure, especially when considering the current market challenges.
“
”
REPORTS
100
REPORTS
101
Our fishing business segment contributed N$50.3 million to operating
profit in the year under review, whilst lower than the prior year, this profit
is a commendable result. Factors such as fluctuating exchange rates as
well as the availability of quota continues to plague all industry players
in this sector, which makes the continued profitability of our fishing
operations all the more noteworthy.
SHARE OF PROFITS AND LOSSES FROM ASSOCIATE AND JOINT
VENTURES
The Group equity accounted a profit of N$3.9 million (2016: N$2.8 million)
from Dimension Data Namibia and a profit of N$0.2m from Mobi-Pay and
N$0.7m from Natural Value Foods. The Group also equity accounted a
loss of N$155.7 million (2016: N$11.5 million) from Heineken South Africa
(Proprietary) Limited (formerly DHN Drinks (Proprietary) Limited). This
loss is substantially higher than the prior year due to both an increase in
our effective shareholding, impacting the percentage of operating losses
recorded as well as the impairments and other adjustments recorded by
Heineken South Africa. For further detail refer to Note 7 in the financial
statements.
FINANCE COSTS
The net finance cost for the year under review has increased from
N$174.9 million in the prior year to N$201.2 million for the year under
review. Over the course of the prior year, debt levels were increased
to fund the construction of the Swakopmund Strand Hotel and the
operational needs of Namibia Breweries Limited.
PROFIT BEFORE TAXATION
The Group saw a decrease of N$244.6 million (-31.9%) in profit before
taxation, from N$767.1 million in the 2016 financial year to N$522.5
million for the 2017 period. The key drivers of this decrease was reduced
fair value gains and higher equity accounted losses as elaborated on in
the preceding sections.
TAXATION
The 2017 financial year’s taxation charge amounted to N$130.4 million
(2016: N$175.1 million), while the effective taxation rate is 24.9% (2016:
22.8%). The effective tax rate is heavily influenced by the disallowable
equity accounted losses, various manufacturing export incentive
allowances and exempt income earned by the group.
STATEMENT OF FINANCIAL POSITION
Total assets grew by N$337.8 million, namely from N$7 464.1 million in
the 2016 financial year to N$7 801.9 million in the year under review.
The bulk of the increase stems from Property, plant and equipment
(including non-current assets held for sale) which increased by N$259.0
million. Capital additions overall amounted to N$377.0 million for the
2017 financial year (2016: N$481.4 million), which is largely constituted
by the capital additions in the Consortium Group for the new jetty and
cyclical refurbishments of its fishing vessels (N$90.3 million), Model Pick n
Pay for new and refurbishing of stores (N$51.3 million) and the Namibia
Breweries Group for plant and equipment (N$166.9 million). Construction
on 77 on Independence was completed during the financial year with
the majority of the residential units sold before year end. Total group
borrowings, inclusive of other financial liabilities, lease liabilities and bank
overdrafts of the group were largely flat on last year, increasing by only
N$10.0 million (0.5%).
REVENUE
Group revenues increased by 13.2% compared with the previous year. This
is mainly attributable to excellent revenue growth in the retail segment
(12.6%), beer and soft drinks segment (11.7%), leisure segment (33.1%)
as well as the properties segment (124.8%). A significant driver of the
growth in properties segment was the sale of the completed residential
units from the mixed use development called 77 on Independence.
The average growth in revenues was pulled down slightly by the fresh
produce segment which delivered moderate revenue growth (2.0%) due
to volume and pricing pressures.
OPERATING PROFIT AND FAIR VALUE ADJUSTMENTS
Operating profit increased by 8.2% compared to prior year whilst fair
value adjustments decreased by 57.6% compared to the prior year.
The growth in the operating profit is attributable to the beer and soft
drinks business segment. The other large business segments, whilst still
delivering solid results, are down compared to the prior year.
The beer and soft drinks segment delivered an excellent result of N$608.3
million, which is a growth of 12.4% over the previous period and was
mainly achieved due to an overall growth of 8% in volumes. The driver
of this volume growth was the increased volumes sold and shipped to
Heineken South Africa. The increase in volumes enabled improved cost
efficiencies, in turn driving increased profitability.
The leisure segment, a new addition to our separately disclosed reportable
business segments, delivered an improvement in operating results with
the losses decreasing to N$12.3million. The growth in the tourism sector
of the domestic economy has strongly benefited this business segment,
with both the Swakopmund Strand Hotel and Mokuti Etosha Lodge
recording excellent occupancies driving good growth in revenues.
The leisure business segment is reaping the cumulative benefits of its
recent additions, such as the opening of the Swakopmund Strand Hotel
in 2016 and Chobe Water Villas in 2017, which is now enabling greater
economies of scale of various centralised costs.
The retail segment delivered a mixed performance during the year
under review, contributing N$8.8 million to operating profit compared
with N$17.2 million in the prior year. Revenues grew by 12.6% in 2017
compared to the prior year and margins remain on target, however
below the line costs mainly related to the revamping of existing stores
and the opening of new stores impacted profits unfavourably.
Inclusive of fair value adjustments, the property business segment
contributed N$238.7 million (2016: N$348.6 million) to operating profits
during the 2017 financial year. The operating profits before fair value
adjustments was very stable for the year under review, growing with 4.5%.
This segment has been impacted by the subdued short term economic
outlook, which in turn has impacted our investment property valuations.
Fair value gains on investment properties is down 61.0% compared to the
prior year, which included some once off gains such as the recognition
of the unutilised bulk potential of Wernhil Park. In the current year, this
segment recorded profits of N$ 30.9 million arising from the completion
and sale of the residential units in the mixed use development called
77 on Independence. Our flagship property Wernhil Park, continues to
deliver strong operational performance on all levels, with stable trading
densities, foot traffic counts and practically no vacancies. This continued
strong performance of Wernhil Park has driven the decision to expand
the mall. The Phase IV expansion, which commenced in July 2017 and is
envisaged to be completed towards the end of the 2019 financial year,
will increase the total trading space by 18,400m2 (an increase of 50.3%).
REPORTS
102
REPORTS
103
OHLTHAVER & LIST CENTRE
PO Box 16, Windhoek
Tel: 061 - 207 5111
Fax: 061 - 234 021
www.ohlthaverlist.com
NAMIBIA BREWERIES LIMITED
PO Box 206, Windhoek
Tel: 061 - 320 4999
Fax: 061 - 263 327
www.nambrew.com
HANGANA SEAFOOD
PO Box 26, Walvis Bay
Tel: 064 - 218 400
Fax: 064 - 218 480
www.hangana.com
NAMIBIA DAIRIES
P/Bag 11321, Windhoek
Tel: 061 - 299 4700
Fax: 061 - 299 4701
www.ohlthaverlist.com
MODEL PICK N PAY
PO Box 2200, Windhoek
Tel: 061 - 296 4500
Fax: 061 - 296 4550
www.ohlthaverlist.com
DIMENSION DATA NAMIBIA
PO Box 16, Windhoek
Tel: 061 - 373 300
Fax: 061 - 373 301
www.dimensiondata.com
BROLL NAMIBIA
PO Box 2309, Windhoek
Tel: 061 - 374 500
Fax: 061 - 237 499
www.brollnamibia.com.na
KRAATZ MARINE
PO Box 555, Walvis Bay
Tel: 064 - 215 800
Fax: 064 - 206 848
www.kraatzmarine.com
O&L LEISURE
PO Box 2190, Windhoek
Tel: 061 - 388 400
Fax: 061 - 234 021
www.ohlthaverlist.com
O&L ENERGY
PO Box 16, Windhoek
Tel: 061 - 207 5111
Fax: 061 - 234 021
www.ohlthaverlist.com
WEATHERMEN & CO
PO Box 16, Windhoek
Tel: 061 - 429 600
www.ohlthaverlist.com
INTEGRATED ANNUAL REPORT 2017 PRODUCTION
Design and layout: Weathermen & Co
Printing and binding: Solitaire Press
Production and editing: Ohlthaver & List Centre with the assistance of GSA Campbell
GROUP REFERENCE INFORMATION
CASH FLOW
Cash flows from operating activities increased to N$790.1million in
the 2017 financial year compared to N$633.3 million in 2016. The net
cash spent in investing activities declined from N$1 112.0 million in the
previous reporting period to N$480.5 million for the year under review.
The overall decrease is a result of the acquisition of shares in an associate
made in the prior year. Cash and cash equivalents amounted to N$411.1
million for the reporting period (2016: N$245.8 million).
DIVIDENDS
The Company declared a dividend of 112c per share on 28 September
2017 (2016: 112c per share) in respect of the year ended 30 June 2017.
Günther Hanke
Group Financial Director
REPORTS
104
REPORTS
105
NOTICE TO THE SHAREHOLDERS
Notice is hereby given of the 69th Annual General Meeting of the
members of the Olfitra will be held on the 7th floor, Werner List
Boardroom, South Block, 23-33 Fidel Castro Street, Windhoek,
Namibia on Monday, 4 December 2017 at 9:00 for the following
purposes:
1. To receive and consider, and if approved, adopt the Annual
Financial Statements and the Report of the Auditors for the year
ended 30 June 2017 as submitted, and to confirm all matters and
things undertaken and discharged by the Directors on behalf of
the Company;
2. To elect Directors in the place of Messrs Udo M Stritter and Ernst
Ender who retire by rotation in accordance with article 71(b)(iv)
(A) of the Olfitra’s Articles of Association but being eligible for
re-election offer themselves for re-election.
3. To approve the remuneration of the Directors, as per article
71(b)(iv)(B) of the Olfitra’s Memorandum and Articles of
Association and as stipulated in the annual financial statements,
of the Annual Report, for the financial year ended 30 June 2017.
4. To approve the Remuneration and Compensation Policy of
Olfitra.
5. To confirm the reappointment of Deloitte & Touche as auditors
and to authrorise their remuneration as stated in article 71 (b)(iii)
(A) and (B) of the Memorandum and Articles of Association .
6. To place the unissued 6,507,083 ordinary shares of 0.50 cents each
in Olfitra under the control of the Directors who will be
authorised to allot all or any of those shares at their discretion, on
such terms and conditions and at such times as the Directors
deem it appropriate.
7. To transact any other business as can be transacted at an Annual
General Meeting.
A member entitled to attend and vote at the Annual General Meeting
is entitled to appoint one or more proxies to attend and vote in his
or her stead. A proxy need not be a shareholder of Olfitra.
In order to be valid, proxy forms must be forwarded to the registered
office of Olfitra by no later than 12:00 a.m. on Tuesday, 28 November
2017.
By order of the Board
Ohlthaver & List Centre (Pty) Ltd
Company Secretary
Windhoek
21 August 2017
106
REPORTS
PROXY FORMfor the 69th Annual General Meeting of
OHLTHAVER & LIST FINANCE AND TRADING CORPORATION LIMITED
Registration Number: 331
The Secretary
Ohlthaver & List Finance and Trading Corporation Limited
PO Box 16
Windhoek
Namibia
I/We ........................................................................................(name in full)
of .............................................................................................................
..................................................................................................................
..................................................................................................... (address)
being a shareholder of ................................................. (number
of shares) of the abovementioned Company hereby appoint
.........................................................................................................(name)
or failing him/her ....................................................................................
........................................................................................................ (name)
or failing him/her ....................................................................................
........................................................................................................ (name)
or failing him/her, the Chairperson of the meeting as my/our proxy to
vote for me/us on my/our behalf at the 69th Annual General Meeting
of the Company to be held in the Werner List Boardroom, Ohlthaver
& List Centre, 7th floor - South Block, Alexander Forbes House, 23-33
Fidel Castro Street, Windhoek Monday 4 December 2017 at 09h00 and
at any adjournment thereof, in particular to vote for/against/ abstain
from* the resolutions contained in the notice of the meeting.
I/We desire to vote as follows: For Against Abstain
1. Adoption of the annual financial statements
2. Re-election of retiring directors:
UM Stritter
E Ender
3. Approve the remuneration of Directors
4. Approve the Remuneration and Compensation Policy
5. Confirm the re-appointment of Deloitte & Touche as external auditors of the company and authorise their remuneration
6. To place the unissued shares under the control of the Directors
* Please indicate your response by inserting an “X” in the appropriate
block to either vote “for/against/abstain from”. If no indication is
given, the proxy may vote as he/she thinks fit.
Signed ...................................................... at ..........................................
this ......................... day of ........................................................... 2017.
Signature(s) of shareholder(s) .................................................................
..................................................................................................................
Notes to the Proxy
1. A member entitled to attend and vote at the aforementioned
meeting is entitled to appoint a proxy (who need not be a
member of the Company) to attend, speak and vote on a poll in
his/her stead.
2. Shareholders who wish to appoint proxies must lodge their
proxy forms at the registered office of the Company by no later
than 12h00 on Tuesday, 28 November 2017.
3. In respect of shareholders that are companies, an extract of the
relevant resolution of Directors must be attached to the proxy form.