SIEGERT’s 190 SELECT
A limited edition rum that epitomizes the
Siegert legacy of Angostura
A combination of warm and passionate aged rums and the company’s unique, iconic aromatic bitters, created in the memory of the only rum made using Angostura® aromatic bitters, Siegert Legacy - “Pink Rum”, and the very first rum made by the Siegerts – “Siegert’s
Bouquet”, which became a Trinidadian tradition and was the start of the company’s rich rum heritage in the 1960s.
Siegert’s 190 Select is truly a classic, showcasing the company’s creativity in blending which Dr.
Johann Siegert, inventor of Angostura® aromatic bitters, was well known for. Full of flavour and aromatic appeal, this rum is like no other dark rum, marrying the strong aromatic strains of the bitters and the robust tones of the rums. It should be sipped neat or on the rocks, and enjoyed in commemoration of the 190 years of tradition that stand behind it.
AMARO DI ANGOSTURA®
A magnificent herbal liqueur marries spirit, spices and bitter herbs after a 3 month engagement period! Amaro di
Angostura® was launched in 2014, crafted as a sophisticated and modern expression of versatility, inspired by our unique
Angostura® aromatic bitters, first created in 1824.
The result — AMARO DI ANGOSTURA® — an elevation of a classic liqueur to an entirely new world dimension to the category. Amaro di Angostura® can be enjoyed over ice, is splendid on its own and offers delicious harmony in a cocktail.
Like Angostura® aromatic bitters, the Amaro di Angostura® recipe will remain a secret. Experience a perfectly balanced drink, exotic, lush, reminiscent of the essence of Trinidad and
Tobago’s pulsating rhythms, tropical climate and beauty. The flavours explode on your tongue with warm cinnamon and liquorice notes.
AN AWARD-WINNING VOYAGE OF 190 YEARS
Angostura No.1 wins 2014 Caribbean Journal
“Rum of the Year” Award
In its anniversary year, 190 years after the House of Angostura was founded, maintaining excellence across its iconic bitters and premium rum range remains an unwavering focus for the brand.
Angostura No. 1 was awarded ‘Rum of the Year’ for 2014 by the
Rum Journal Awards.
“This is simply a magnificent rum — floral, sweet, perfectly balanced with an exquisite finish. It somehow dances in the mouth. And, even more importantly, it rates exceedingly highly on the drinkability scale.
... Cheers to our 2014 Rum of the Year, Angostura No. 1.”
(Caribbean Journal)
HOUSE OF ANGOSTURA … The Grand Rum Master 2014 wins four medals at the 2014 Rum Masters Awards
Gold for Angostura Reserva
Gold for Angostura 7 Year Old Rum
Gold for Angostura 1824
Angostura also won the Rum Grand Master title at the 2014 Spirits
Masters Awards, chaired by The Spirits Business in London, bestowing upon Angostura the prestigious recognition of the best distiller of
Rum in the world for the fourth consecutive year.
2
Angostura Holdings Limited
• Annual Report 2014
Notice of Annual General Meeting of
Angostura Holdings Limited
NOTICE IS HEREBY GIVEN, that the Thirty-third Annual General Meeting of Angostura
Holdings Limited, (the “Company”) will be held at the House of Angostura, Angostura
Complex, Eastern Main Road, Laventille, Trinidad and Tobago, on Monday July 27, 2015 at 10:00 am for the following purposes:
1. To receive, consider and approve the Report of the Directors, the Audited Financial
Statements of the Company for the financial year ended December 31, 2014, together with the report of the Auditors thereon, and
2. To appoint Messrs. KPMG as auditors of the Company for the financial year ending
December 31, 2015, and authorise the Directors to fix their remuneration therefor, and 3. To re-elect Directors.
BY ORDER OF THE BOARD
Lyn Patricia Lopez
Secretary
June 30, 2015
NOTES
1. Every member who is entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and on a poll to vote in that member’s place. A proxy need not be a member of the company. Where a proxy is appointed by a corporate member, the form of proxy should be executed under seal or be signed by its attorney
2. No service contracts not expiring or determinable within 10 years have been entered into between the company and any of its directors
3. To obtain a soft copy of the consolidated financial statements for the year ended
2014, please log onto on our website (www.angostura.com)
4. Queries may be directed to the Company Secretary at 623 1841 ext. 123 or lopezl@angostura.com Angostura Holdings Limited
• Annual Report 2014
Table of Contents
Notice of Annual General Meeting
2
190 Years Angostura
4
Corporate Information
5
Message from the Chairman
6
Message from the Chief Executive Officer
7
Corporate Governance Report
12
The Board of Directors
15
Directors’ Report
16
Directors’ & Substantial Shareholding
17
The Executive Team
18
Corporate Social Responsibility
19
Human Relations
23
Our bitters: a Celebration of Quality
24
Connoisseurs of the World Agree ...
25
Taste, Tradition, Trendiness - Angostura’s Fine Rums
26
Audited Consolidated Financial Statements
29
Statement of Management’s Responsibility
30
Independent Auditors’ Report
31
Consolidated Statement of Financial Position
32
Consolidated Statement of Comprehensive Income
33
Consolidated Statement of Changes in Equity
34
Consolidated Statement of Cash Flows
35
Notes to Consolidated Financial Statements
36
Management Proxy Circular
77
Proxy Form
79
Design and Layout: Paria Publishing Co. Ltd.
Photographs of Directors: Abigail Hadeed
Photograph of Executive Team: Terran Eligon
Printing: RPL (1991) Limited, with special thanks to Sunil Ramlogan (Account Executive)
3
4
Angostura Holdings Limited
• Annual Report 2014
190 Years Angostura
190 years of continuous corporate history are indeed outstanding and special in the New World. Few
Caribbean companies have achieved this milestone, and even fewer have contributed so much to the country in which they operate.
In 2014, the House of Angostura celebrated its
190th annversary. A number of events were held to celebrate the momentous occasion—new products were launched and new production facilities were commissioned. Trinidad and Tobago has probably only two iconic products that serve to identify the nation worldwide: the steelpan, and Angostura® aromatic bitters. But unlike the musical instrument, which is a relatively recent invention, Angostura’s roots reach deep into the beginnings of the 19th century.
In this report, we celebrate 190 years of our eventful history and commemorate the milestones that have made the House of Angostura into the eminently successful company that it is today.
1819–1823
Simon Bolivar’s campaigns to liberate New Granada and
Venezuela
1824
Dr. J.G.B. Siegert, a Silesian doctor who migrates to South America to become a surgeon in Bolivar’s armies, develops his “Amargo aromatico”, Angostura® aromatic bitters, in Angostura (today Ciudad Bolivar).
1850s
First export shipments of
Angostura® aromatic bitters to
England and to Trinidad
Angostura Holdings Limited
• Annual Report 2014
5
Corporate Information
Board of Directors
Bankers:
Krishna Boodhai
Marlon Holder
Carolyn John
Joseph Teixeira
Robert Ramchand
Gerald Yetming (Chairman)
Ansa Merchant Bank Limited
Ansa Centre
11 Maraval Road
Port-of-Spain, Trinidad & Tobago
Company Secretary:
Lyn Patricia Lopez, L.L.B. (Hons.) L.E.C.,
Counsel
Registered Office:
Corner Eastern Main Road & Trinity Avenue
Laventille, Trinidad & Tobago
E-mail: lopezl@angostura.com
Website: www.angostura.com
Registrar & Transfer Office:
Trinidad and Tobago Central Depository Limited
10th floor, Nicholas Towers
63-65 Independence Square
Port of Spain, Trinidad & Tobago
Auditors:
KPMG
TRINRE Building
69-71 Edward Street
Po Box 1328
Port-of-Spain, Trinidad & Tobago
1860s
Don Carlos Siegert embarks on a series of visits to international trade exhibitions and introduces Angostura® aromatic bitters to the world.
Citibank (Trinidad and Tobago) Limited
12 Queen’s Park East
Port-of-Spain, Trinidad & Tobago
First Citizens Bank Limited
Corporate Banking Unit
2nd floor, Corporate Centre
9 Queen’s Park East
Port-of-Spain, Trinidad & Tobago
RBC Royal Bank (Trinidad and Tobago) Limited
St. Clair Place, 7-9 St.Clair Avenue
Port-of-Spain, Trinidad & Tobago
Republic Bank Limited
Promenade Centre, 72 Independence Square
Port-of-Spain, Trinidad & Tobago
Attorneys-at-law:
J.D. Sellier & Company
129-131 Abercromby Street, Port-of-Spain
Trinidad & Tobago
Lex Caribbean
First Floor
5-7 Sweet Briar Road, Port-of-Spain
Trinidad & Tobago
1864
Don Carlos is recorded as a rum producer by a
German traveller. This makes Angostura one of the oldest rum distilleries in continuous existence in the Caribbean today.
6
Angostura Holdings Limited
• Annual Report 2014
Message from the Chairman
Gerald Yetming
The Group has ended 2014 with results from continuing operations of $217.3 million and profit after tax of $153.4 million, compared to $196.2 million and $289.0 million respectively for the prior year. Included in the prior year profit after tax was non-recurring income of
$151.8 million, representing gains from the settlement of debt and disposal of investments.
Underscoring the 2014 performance is topline growth of $9.0 million together with efficient management control of our operating expenses.
Our brands continue to grow profitably and the results from the branded business increased by $14.6 million (7.4%) over the prior year despite the many challenges in the domestic market and in some of our international export markets.
Significant capital investment continues to be undertaken as we steadily modernize our plant and ensure a strong asset base to support the needs of our business. Positive cashflows continue to support healthy returns to shareholders, and cash and cash equivalents exceeded total borrowings by
$58.6m at the year end.
The EPS of $0.75 reflects the solid performance of the Group for the year and in light of this, the Board is pleased to announce a final dividend of 16¢ per share in respect
of 2014, with a record date of April 10, 2015 and payment date of April 24, 2015. Together with the interim dividend of $0.10 paid on September 1,
2014, this brings the total dividend in respect of
2014 to $0.26 per share.
Through consistent effort, talent and commitment, we continually work to maintain the right business focus in light of economic and environmental challenges domestically and internationally. In this regard, I wish to thank the Members of the Board of Directors for their valued contribution to the governance of the Group over the past year, and to commend management and all employees for their loyalty and astute execution of strategies that have yielded the results now reported.
We look forward to a profitable year ahead as we continue to work with all stakeholders to achieve growth and success for the Group.
Gerald Yetming
Chairman
Angostura Holdings Limited
• Annual Report 2014
7
Message from the Chief Executive Officer
Robert Wong
2014 Performance Highlights:
•
Results from continuing operations of $217.3m in 2014 versus $196.2m in 2013, an improvement of $21.1m (10.8%)
•
Launch of Siegert’s 190 Select Rum, premium rum infused with Angostura® aromatic bitters •
Launch of Amaro di Angostura®, a herbal liqueur made using natural herbs and spices, to compete in the Amaro category of spirits internationally
•
Named Innovator of the Year by the Trinidad and Tobago Manufacturers’ Association (TTMA)
•
Angostura Rums captured the Rum Grand Master award for the fourth consecutive year and earned 4 product awards from The Spirits Business in the United Kingdom; Multiple product awards from World Spirits Awards and International Wine and Spirit Awards; Rum of the year from Caribbean Journal’s Rum Awards
•
Attained ISO 22000 Food Safety Management certification
8
Angostura Holdings Limited
• Annual Report 2014
Message from the CEO (continued)
2014 represented a milestone for Angostura: 190 years of excellence in business and service. These qualities permeate the Company not only in terms of financial results, but also in the areas of brand distinction, corporate social responsibility, employee engagement and operating excellence. It is with great pride that we celebrate our history while looking towards the future in anticipation of continued success.
Results from continuing operations
(TT$ millions)
The Company’s financial results continue to demonstrate the strength and appeal of our brands across many markets both local and international. The branded business has shown growth in 2014 as investments to develop the brands have generated returns.
Reduced operating and financing expenses in 2014, together with revenue growth, have led to an improvement in ‘Results from continuing operations’. This measure of core business performance shows steady growth since 2011 despite increasing challenges in domestic and overseas markets in the areas of cost control, competition management and constantly changing consumer taste. Strategies of process and facility improvement along with operating cost and investment management, will ensure continued improvement of the financial results of the Company in accordance with our long term objective of sustainable growth.
Shareholders’ equity has increased from $234.3m in
2011 to $775.0m in 2014, a $540.7m improvement driven primarily by net profits. Reported results and equity growth are matched by increasing returns to shareholders whose long standing commitment to the
Company has aided in the achievement of these results.
1870
Dr. J.G.B. Siegert dies, and the Siegert family relocates from Venezuela to
Trinidad, taking their bitters-making and rum-production capabilities with them.
Dividends declared per year
1873
The hallmark of Angostura® aromatic bitters, Dr. J.G.B. Siegert’s signature between the obverse and reverse of the Medal of
Excellence, achieved at the Grand Exhibition at Vienna in that year, is established against imitators of the product.
Angostura Holdings Limited
• Annual Report 2014
9
Message from the CEO (continued)
Cash resources are managed with this objective in mind, and the Company is committed to ensuring that the needs of all stakeholders are consistently met. New focus markets as well as growth of existing ones, contributed to the success of the branded business during the year. While the overseas markets of
North America, Europe and Australia have continued to produce results, a renewed focus in Central and
South America has been positive to date. The bitters and rum brands including bulk rum blends have been well received in markets such as Chile and
Brazil, and prospects for continued growth in other
Latin American markets are promising. Exports are growing at an impressive rate and present organic growth potential for the Company, to support the domestic trade which continues to generate solid returns despite challenges from a constantly evolving business and legislative environment.
Our brand equity remains strong for core brands and we have successfully introduced new products.
Siegert’s 190 Select, a limited edition bitters infused rum, was produced in commemoration of our 190th anniversary and sold out within a few weeks of launch. This brand married bitters with rum to create a unique spirit which captured the attention of local and export customers. Additionally, the “bitters” family has been expanded with the introduction of a herbal liqueur, Amaro di Angostura, launched in the
U.S. and local market initially in 2014, and targeted
1900s
Angostura is listed on the
London Stock Exchange.
for the Australian and European markets in 2015.
Reviews of the product have been positive to date and interest is growing in many export markets.
The Trinidad and Tobago Manufacturers’ Association
(TTMA) recognized the significance of these two products and named Angostura the 2014 Innovator of the Year in its recent Annual Awards and
President’s Dinner ceremony. In addition to this, the
Company received a number of international awards during the year. In 2014 we once again earned the
Spirits Business, Spirits Masters award for Rum
Grand Master, with 3 gold and 1 silver medal being awarded to our international and premium rum range. These brands also received 4 gold and one double gold medal at the World Spirits Awards in
Austria, and 2 gold and 2 bronze medals at the
International Wine and Spirit Competition in the
United Kingdom. In addition, the Caribbean Journal named Angostura No. 1 Cask Collection, the Rum of the Year in its 2014 Rum Awards.
Awards and recognition are not unique to the brands of Angostura. We seek to establish and maintain best practice standards in all areas of the Business, from detailed work methods to environmental awareness, employee well-being and customer support.
During the year, the Company attained certification under ISO 22000 Food Safety Management, signalling to local and international stakeholders its compliance with international quality standards for plant and production. The Company is already
1919
Don Carlos dies, and his brother Alfredo Cornelio comes to the helm of
Angostura. He invests heavily in several development projects (e.g. a train line to Chaguaramas) which fail to materialise. The value of the company’s shares falls dramatically, Angostura falls into the hands of its creditors.
10
Angostura Holdings Limited
• Annual Report 2014
Message from the CEO (continued)
certified under ISO 9001 Quality Management and
ISO 14000 Environmental Management.
These
certifications allow us to trade internationally and access new markets on par with any global organization; internally they promote exceptional standards of operations. By investing time and resources today to continually improve operations, the current and future needs of the Business can be met and a foundation laid for sustainable growth across all areas.
In line with this view, significant plant upgrades were again undertaken in 2014 to further enhance production capabilities and ensure the high quality of processes and output. As the bitters business continues to grow, additional resources have been allocated to support operations, and in 2014 we proudly commissioned a new state of the art Bitters
Facility to house the packaging of bitters as well as store raw materials and finished product.
Bitters being packaged at the new facility.
Apart from packaging operations, major investments included an upgrade of our Chaguarams port facility with additional storage to handle raw material imports and larger volume exports. From an environmental standpoint, construction has commenced on a dedicated effluent treatment facility for production waste discharge.
Our employees are dedicated to achieving the
Company’s goals and upholding core values, and are well trained and equipped to perform their jobs
1920–1933
Prohibition in the United States serves to increase demand for Caribbean rum shipped via Central and Canada to the USA. World recession greets great poverty in the world, but Alfredo Gallo continues to produce Angostura products in considerably reduced circumstances. There is hardly any market for rum and bitters.
1940s
Alfredo Galo Siegert becomes keeper of the secret formula of
Angostura® aromatic bitters
Angostura Holdings Limited
• Annual Report 2014
11
Message from the CEO (continued)
at the highest standard. Specialized training programmes are provided to ensure that skills are developed not only for defined needs, but also to provide general resources for use by employees at all levels in the execution of their daily duties.
region and facilitate expanded business with new customers. New markets have been identified for penetration in the coming months and with well managed brand investment, these markets will yield positive returns in the future.
In addition to seeking the welfare of employees and investors, we aim to give back to the community in a meaningful way and as such, our Corporate
Social mandate has continued to develop with many exciting activities which have touched the lives of our immediate community as well as the wider society. Youth outreach programmes such as the annual Children’s Summer Camp continue to bring us closer to the families of the community, while other projects such as the
‘Phone a Taxi’ mobile app, clearly demonstrate our concern for the general public and support for responsible consumption across the nation, in line with local legislation.
Indeed 2014 has been a momentous year for
Angostura, as we celebrated our 190th anniversary with commendable success, and in this regard,
I extend our gratitude to our customers for their loyal support, employees for their dedicated service and Board of Directors for their valued guidance and stewardship over the past year. To quote an old adage ‘practice makes perfect’ and after 190 years of practice, we are privileged to report sustained, sound performance of the Company and a promising future ahead for all stakeholders.
The future for Angostura is bright as we seek continual improvement in many aspects of the business. Apart from 2014 launches, new products are targeted for launch internationally in 2015 to keep the business exciting and relevant not only to existing customers, but also to potential new customers in the industry. Plans are underway for the restructuring of our international distribution network for European markets, to support further improvement in sales and profitability across this
1941
Angostura® aromatic bitters first uses the “scrambled” logotype
Robert Wong
Chief Executive Officer
1941–1950s
Thousands of servicemen from the USA and Canada come to Trinidad to serve on the naval and air bases established here. They mix Angostura rums with their own Coca-Cola, flavoured by the aroma of Angostura® aromatic bitters.
12
Angostura Holdings Limited
• Annual Report 2014
Corporate Governance Report
Sound Corporate Governance remains at the forefront of the Company’s business. In 2014, the
Company focused on reviewing and assessing the need to deepen its risk management framework throughout its operations. The Company has also introduced a formal policy on third party board appointments that are assumed by employees.
Board of Directors:
The Board of Directors comprises 6 directors. The roles, responsibilities of the Board and key officers, Board code of conduct and Committee Charters are all documented in the Board of
Directors’ Manual. The Board of Directors held 10 meetings in 2014 with an attendance rate of
91%.
Board Committee reports
Three Committees of the Board of Directors - the Audit Committee, the Human Resource &
Compensation Committee and the International Distribution Committee , discharge specific functions and objectives set out in their respective Committee Charters and/or Mandates. The
Board of Directors encourages an open door policy to all non-Committee directors, inviting these members to attend and contribute to Committee meetings in support of a more cohesive, transparent and integrated functional team.
•
Audit Committee Report
The Audit Committee comprises the following members: Joseph Teixeira (Committee Chairman);
Krishna Boodhai and Carolyn John and Robert Wong (ex-officio). The Audit Committee’s areas of responsibility relate to the financial statements, internal and external audit functions and internal controls and risk management. The Audit Committee has held 4 meetings in 2014.
➢ Internal Control and the Internal Audit Function
The continual assessment of the Company’s internal control systems is a high priority of
Internal Audit. Management also is responsible for establishing a separate risk management team, whose risk assessment reports and operations are reported to and reviewed by the
Audit Committee and a third party quality management auditor (under ISO 9001 Quality
Management audits and re-certification exercises). The Audit Committee is satisfied that
Management, by approved risk corrective actions, has adequately remedied weaknesses in internal controls identified in the various streams of audit reports.
1940s
The Andrews Sisters make a local calypso internationally known: “Drinking Rum and Coca-Cola,
Go down Point Cumana”
1947
Angostura’s chemists begin to scientifically study various strains of yeast used in the fermentation of molasses.
Angostura Holdings Limited
• Annual Report 2014
13
Corporate Governance Report (continued)
➢ Internal Audit
The Head of the Internal Audit unit reports functionally to the Audit Committee and administratively to the Chief Executive Officer. The Internal Audit unit operates in accordance with the International Standards for the Professional Practice of Internal Auditing, the
Internal Audit Charter and pursuant to an Annual Internal Audit Plan (reviewed bi-annually) that is approved by the Audit Committee. The Audit Committee is satisfied that the Internal
Audit function has been performed objectively and transparently, without undue influence from Management.
➢ External Audit
The Audit Committee has reviewed and approved the External Auditor’s scope and methodology of their assessment of the consolidated financial statements for the year ended 2014. The Audit Committee is satisfied that the External Auditor has planned and conducted the audit to derive reasonable assurance that the financial statements are free of material misstatement and present a true and fair view of the financial position of the
Company, as at December 31, 2014 and that the corresponding results of its operations and its cash flows are in accordance with International Financial Reporting Standards.
➢ Financial Statements
During 2014, the Interim unaudited financial statements were presented to the Audit
Committee at its quarterly meetings for review and recommendation for adoption by the
Board. The Audit Committee is satisfied that the audited consolidated financial statements set out in this Annual Report are complete, consistent with information known to the
Committee and conforms to applicable, consistently applied accounting principles.
•
Human Resource and Compensation Committee (HRCC) Report
The HRCC comprises the following members: Gerald Yetming (Committee Chairman); Joseph
Teixeira; Krishna Boodhai and Robert Wong (ex-officio). The HRCC areas of responsibilities relate to:
(a) evaluating Board Performance, Executive Management performance and Executive & Staff compensation. 1948
Establishment of Trinidad Distillers
Limited as a wholly-owned subsidiary of the House of Angostura
1958
Establishment of Siegert Holdings Limited.
Profits on rum exceed those on Angostura® aromatic bitters for the first time
14
Angostura Holdings Limited
• Annual Report 2014
Corporate Governance Report (continued)
(b) recommending director compensation for shareholder approval, nomination of new directors and Committee appointments, and
(c) working with Management to assess and improve policies related to business conduct
(including, trade and other required disclosures, insider trading and conflict of interest issues), and ethics.
The HRCC has held 3 meetings in 2014.
•
International Distribution Committee (IDC) Report
The IDC comprises the following members: Gerald Yetming (Committee Chairman); Joseph
Teixeira; Robert Ramchand and Robert Wong (ex-officio). The IDC operates from a Mandate issued at the Board level, intended to lend guidance to an evolving framework for the selection and structuring of key distributors, expansion plans and sales growth in the international markets. The ICD has held 6 meetings in 2014.
1960s
Robert Siegert, Thomas Gatcliffe and Albert Gomez make Angostura the first rum manufacturer in Trinidad to operate on the basis of its own pure yeast cultures
1960s
Gordon Siegert enters the family company as marketing director, the last Siegert to have worked at the House of Angostura
Angostura Holdings Limited
• Annual Report 2014
The Board of Directors
Gerald Yetming
Chairman - AHL Board
Chairman - HR Compensation
& International Distribution
Committees
Carolyn John
Member – Audit Committee
Krishna Boodhai
Member - Audit & HR
Compensation Committees
Robert Ramchand
Member - International
Distribution Committee
Joseph Teixeira
Marlon Holder
Chairman – Audit Committee
Member - International Distribution
& HR Compensation Committees
1973
Angostura acquires Fernandes Distillers (1993)
Ltd., adding to its product lines brands such as
Vat 19, Black Label and Ferdi’s
1985
Angostura receives the national Hummingbird
Medal Gold for its contribution to industry, the first company in Trinidad and Tobago to be so honoured.
15
16
Angostura Holdings Limited
• Annual Report 2014
Directors’ Report
The Directors present their Report and Statement of Account for the year ended December 31, 2014.
Financial Results for the Year
Profit attributable to shareholders
Other reserve movements
Dividends on ordinary stock
Final Dividend paid - 12¢
Special Dividend paid - 4¢
Interim paid - 10¢
$’000
153,426
4,595
(24,753)
(8,251)
(20,628)
(53,632)
Retained profits from the previous year
Retained profits at the end of the year
452,184
556,573
DIVIDENDS
The Directors have declared a final dividend of $0.16 per ordinary share for the year.
AUDITORS
To appoint Messrs. KPMG, as auditors of the Company for the financial year ending December 31, 2015, who offer themselves for re-election.
BY ORDER OF THE BOARD
Lyn Patricia Lopez
Secretary
June 30, 2015
1985
Her Majesty Queen Elizabeth II visits Angostura during her state visit to Trinidad and Tobago
1986 and 1999
The Trinidad and Tobago Postal Services issues stamps to celebrate Angostura’s anniversaries
Angostura Holdings Limited
• Annual Report 2014
Directors’ & Substantial Shareholding
Directors’ Shareholdings:
Krishna Boodhai
Marlon Holder
Carolyn John
Robert Ramchand
Joseph Teixeira
Gerald Yetming (Chairman)
April 16, 2015
Nil
Nil
Nil
Nil
Nil
Nil
Substantial Shareholders:
Rumpro Company Limited
Colonial Life Insurance Company (T&T) Limited
92,551,212
66,971,877
A substantial interest means 5% or more of the issued share capital of the company.
1995
Angostura achieves ISO 9001 certification
1996
The Museum at the House of Angostura is opened
17
18
Angostura Holdings Limited
• Annual Report 2014
The Executive Team
Genevieve Jodhan
Executive Manager International Sales &
Marketing
R. Douglas
Henderson
Executive ManagerRegional Sales and
Marketing
Robert Wong
Chief Executive Officer
Brenda de la Rosa
Executive Manager
- Domestic Sales &
Marketing
Lyn Lopez
Executive Manager
- Legal Services &
Company Secretary
Alana Beaubrun
Executive Manager HR & Administration
1997
Bacardi sells its shareholding in Angostura to CL Financial. CL Financial forms CL World Brands as a holding company to acquire drinks manufacturing companies internationally and adding their products to the Group’s portfolio.
Romesh Singh
Chief Operations Officer
2000s:
Some of the new products: Angostura® 1824,
Angostura® 1919 and Angostura® Lemon,
Lime & Bitters
Angostura Holdings Limited
• Annual Report 2014
19
Corporate Social Responsibility
Angostura attributes the sustainability of its legacy and growth as a company to its careful management of profits, people and the planet. Success is not only measured in dollars and cents.
It is in the management of the environment, the care of its employees and the levels of social support of its surrounding neighbours and the national community as a whole.
Over the course of 2014 the Company participated in or facilitated a number of activities which ascribed to this ‘triple bottom line’. Some of these included:
Responsible Consumption
One of the Company’s four key objectives is alcohol awareness and the promotion of responsible consumption of its products.
With this in mind, Angostura facilitated several activities in 2014 including:
• Sponsorship of two persons to the annual national two-week symposium on alcoholism and addiction studies hosted by CARIAD in Tobago;
•
Assisting
Arrive
Alive’s awareness campaign through the donation of a breathalyzer, printing road safety booklets and advertising materials, as well as
financial support for its ‘Remember Me’ walkathon. • Hosting an alcohol awareness month in
September - staff participated in activities conducted by Arrive Alive and listened to presentations from members of Alcoholics
& Narcotics Anonymous, as well as recitals from Spoken Word poets on the topic.
Employees from several companies in the area were also invited to attend a workshop on responsible consumption.
•
Workshops were conducted at three primary schools in the Laventille/Morvant area by life-skills coordinator Sandra Blood on the effects of alcohol consumption on the young mind. • Ads were run in the newspaper which promoted the concept of Designating a
Driver and Knowing your Limit.
Partnering with Arrive Alive to educate the public about responsible consumption
20
Angostura Holdings Limited
• Annual Report 2014
Corporate Social Responsibility (continued)
Angostura partners with NGOs to teach school children about forest fire prevention
Environmental Ethics
As a manufacturing concern Angostura has moved to articulate an environmental position that takes into account its close proximity to a residential community. This has resulted in several key initiatives which allow the
Company to keep abreast of international standards required to maintain its ISO
14001 certification over the years. One such initiative is the construction of our own waste water treatment facility on the compound to deal with all effluent coming out of the plant.
Additionally, the Company stresses the importance of recycling in as many areas of its day-to-day operations as possible. These include – recycling cartons, glass, sugar bags, toner & ink cartridges, waste oil and scrap metal.
World Environment Day is observed at Angostura annually. Posters were displayed in the staff lunch room on this year’s theme and employees had an opportunity to win seedlings by answering simple questions. A tree planting exercise was also conducted at the Company’s facilities down
Chaguaramas.
Financial assistance was given to the Fondes
Amandes Community Reforestation Project
(FACRP) for its annual fire prevention GAYAP and eco-culture vacation camp. We also continued with our Green Initiative project in several primary schools in the Laventille/Morvant area, helping them to establish 4H clubs and gardens.
Angostura Holdings Limited
• Annual Report 2014
21
Corporate Social Responsibility (continued)
Employee Engagement
At Angostura we encourage staff to participate in activities that would help them give back to the community or society as a whole. Angostura teamed up with employees of Glaxo Smithcline for a beach cleanup campaign. Angostura was one of the companies whose participation was recognised during the launch a few months earlier for its contribution to data collection and environmental improvements.
Members of our staff at the coastal cleanup
Community Investment
Angostura takes its role in the community of Laventille/Morvant very seriously and continues to engage in a number of activities and programmes which seek to cement our position as a leader in Corporate Social
Responsibility. Some of the major initiatives the Company supported or sponsored this year include:
• Heroes Foundation “It takes a hero” project in the Russell Latapy Secondary
School, Morvant;
• Developmental workshop for teachers of the Success/Laventille Secondary
School;
•
Execution of the first annual Laventille/
Morvant Youth Games for primary school students; •
Donation to the Heroes Foundation
The ‘Back to School’ program executed by the Chinapoo Police Youth Group;
• Donation to K.I.N.D. of a water pump, toys and hampers for Christmas;
•
The Company gave financial assistance to the Healing with Horses vacation camp in Tobago for children with special needs. Hockett Baptist Primary School first place in the Laventille/
Morvant Youth Games for primary schools.
22
Angostura Holdings Limited
• Annual Report 2014
Corporate Social Responsibility (continued)
Donating barrels to school gardens
Other areas of ‘Investment’
Angostura is a strong supporter of Arts &
Culture and Youth Development. In 2014 the
Company:
• Sponsored the Uptown Carnival Bomb
Competition and gave assistance to the
Arima Carnival committee and over 20 unsponsored steelbands;
• Assisted with an awards ceremony presented by the Dreamchaser Foundation;
• Gave financial support for the Tobago
Heritage Festival and the communities of
Plymouth and Buccoo.
• Provided financial support for the productions of ‘Jesus Christ, Superstar’ and the ‘Phantom of the Opera’, as well as assisted the Calabash Foundation for the Arts;
•
Made several bursaries to students under its UWI Development Fund program in a variety of academic fields;
• Presented a cheque to the Credo
Foundation for Justice (a home for ‘street’ children); Employees looking after the Tobago Heritage Festival
Angostura Holdings Limited
• Annual Report 2014
23
Human Relations
2014 marked 190 years since our flagship product Angostura® aromatic bitters was birthed in the town of Angostura,Venezuela, along with the introduction of several high quality rum products, produced that have added adding value to the legacy of the Company.
This milestone was celebrated with employees throughout the year ensuring the rich history of the organisation is remembered. We began the year with the 190th Launch, which included celebrating with a large bitters bottle cake to match the one which was placed at the front of the building. All employees were invited to a celebratory lunch and toast to mark the occasion. Later in the month of January, a new bottling facility, dedicated solely to the bottling and packaging of our aromatic bitters, was opened
– the only place in the world where this is done!
The Executive team was on hand to cut the ribbon to reveal the most modern equipment, capable of taking us into the next century.
Angostura Ltd. was also privileged to host at this launch Mr. Gordon Siegert, the last Siegert to work at Angostura Ltd. and our founder’s great, great, grandson.
CEO Robert Wong and colleagues cutting the cake
Employee activities were executed with a twist of history and one such activity was the
Digital Treasure Hunt where ‘hot spots’ were placed throughout the compound engaging employees to answer historical questions as they manoeuvred the tasks. This called for some innovation with social media a necessity to win points through photographs and videos.
Teams completed the evening with a karaoke competition to which there was lots of laughter and enjoyment.
Gordon Siegert launches the new Bitters facility
24
Our bitters: a Celebration of Quality
190 years ago, Dr. J.G.B. Siegert invented the secret recipe for
ANGOSTURA® aromatic bitters. From Venezuela to Trinidad, this amazing brand spread through every country in every continent, and is now a quintessential ingredient in cocktail recipes globally. It is often said that no bar or kitchen is complete without ANGOSTURA® aromatic bitters. Now that’s a reason to celebrate!
Made with the same secret recipe since
1824, the world famous
ANGOSTURA® aromatic bitters is an ingredient used in cocktails to build flavour, add complexity and achieve balance. It is used in sauces
ANGOSTURA®
and marinades by chefs
Orange Bitters and home cooks adds depth to martinis alike. and cocktails made with vermouth, gin, vodka, rum and whiskey. It enhances the flavour in savoury sauces, and desserts made with chocolate.
ANGOSTURA®
Lemon Lime and
Bitters is a refreshing beverage made with
ANGOSTURA® Aromatic
Bitters. The perfect nonalcoholic drink to sip on a steamy tropical day. “Lime Like a
Boss!”
Amaro
Di Angostura® is a deep amber coloured liqueur, offering aromas of cinnamon and citrus top notes of
Angostura® aromatic bitters.
The flavours explode on the tongue with warm cinnamon and licorice notes. 25
Connoisseurs of the World Agree ...
Two carefully crafted premium rums: Angostura® 1919 and Angostura® 1824.
Gold – aged – premium - award winning rum. Rum made from one distillery in
Trinidad.
Angostura®
1919
Smooth - golden - precious: the
Angostura® 1919 is unmatched in its skilful blend. This premium eight-year old rum commemorates the day in 1932, when a fire destroyed the Government Rum Bond in Trinidad.
Master blender J.B. Fernandes bought the charred casks, to discover a smooth aged delicate rum that had been ageing in them since 1919. A prized rum that is a favourite with conoisseurs the world over.
Angostura®
1824
A blend of the finest mature rums, hand-picked by Angostura’s master blender. Aged for a minimum of twelve years, this hand-blended and hand-casked rum is a speciality that will satisfy the most discerning palate.
Angostura® 1824 commemorates the
Company’s foundation date, and is the pinnacle of hospitality in fine bars and homes of the
Caribbean region and beyond. 26
Taste, Tradition, Trendiness - Angostura’s Fine Rums
Angostura®
Single Barrel
Rum
Enticing, luxurious and complex, with a bouquet of licorice, spice, chocolate, banana and apple with a lingering hint of oak. The quintessential sipping rum, best enjoyed neat or on the rocks.
White
Oak® Rum
A lively, lightbodied rum, specifically blended for the
Caribbean market. Carbon filtered to remove the dark oak colour and then blended to perfection for a unique, crisp taste, clean and light with hints of fruit in its aroma. The perfect mixer!
Vat
19® Rum
A light golden rum: clear, fruity and pungent, with notes of pineapple, grapefruit and pear. Epitomises the
Spirit of Trinidad.
27
Royal
Oak® Select
Trinidad Rum
A blend of carefully selected
Trinidad rums aged for a maximum of 5 to 7 years.
Medium bodied, rounded, mellow taste ideal for sipping yet versatile as a mixing rum. Forres
Park®
Puncheon Rum
Comfort and warmth against the elements. Trinidad and
Tobago’s favourite over-proof rum, enjoyed by all. At 75% alcohol by volume, this rum packs a strong punch. Enjoy responsibly! Fernandes®
Black Label
Rum
With its complex aroma encompassing the woody notes of coconut, cloves, lemon and even a hint of vanilla, this is a rum made to be savoured, unhurriedly.
This brand symbolises more than 100 years of tradition, meticulousness and wellearned respect.
28
Angostura Holdings Limited
• Annual Report 2014
TTMA Award
Innovation in taste that seeks its equal!
Amaro di Angostura® and Angostura®
Siegert’s 190 Select rum were awarded the
“Innovator of the Year 2014” award by the
Trinidad
and
Tobago
Manufacturers
Association.
A proud achievement for our staff who worked diligently on bringing these two products to life in time for our 190th anniversary!
Angostura® 1919 campaign wins Gold Addy Awards
Blu vodka campaign wins Silver Addy Awards
Angostura Holdings Limited
• Annual Report 2014
Audited Consolidated Financial Statements of Angostura Holdings Limited
December 31, 2014
29
30
Angostura Holdings Limited
• Annual Report 2014
Statement of Management’s Responsibility
The Audited Consolidated Financial Statements of Angostura Holdings Limited and its subsidiaries
(the Group) set out in this Annual Report, were prepared by Management, who is responsible for the integrity and fairness of the information presented. Management acknowledges its responsibility for: (a)
the preparation of the Audited Consolidated Financial Statements annually,
(b) establishing and maintaining an adequate internal control structure and procedures, accounting records for financial reporting, which form the basis of the Audited Consolidated
Financial Statements and safeguarding the assets of the Group;
(c)
applying the appropriate accounting policies and calculating reasonable accounting estimates,
(d) ensuring that the Audited Consolidated Financial Statements presented are a true and fair presentation of the state of affairs of the Group, which includes ensuring that the information from which the Audited Consolidated Statements are derived, is structured and adequately assessed to ensure accurate information is provided and
(e)
ensuring that the information presented is free from material misstatement, whether due to fraud or error.
The Audited Consolidated Financial Statements of Angostura Holdings Limited and its subsidiaries are prepared in accordance with International Financial Reporting Standards, and the appropriate accounting policies have been established and applied in a manner, which give a true and fair view of the Group’s financial affairs and operating results. Further, no event, circumstance or information has been brought to attention of Management that compromises the Group’s status as a going concern for the next twelve months from the date of this statement
Robert Wong
Bernadette Sammy
Chief Executive Officer
Financial Controller
March 23, 2015
March 23, 2015
Angostura Holdings Limited
• Annual Report 2014
Independent Auditors’ Report
To the Shareholders of Angostura Holdings Limited
We have audited the accompanying consolidated financial statements of Angostura Holdings
Limited and its subsidiaries (the Group), which comprise the consolidated statement of financial position as at December 31, 2014, the consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing.
Those standards require that we comply with relevant ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2014, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards.
Chartered Accountants
March 23, 2015
Port of Spain
Trinidad and Tobago
31
32
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Current liabilities
Borrowings
18
Taxation payable
Trade and other payables
20
50,300
3,977
134,651
114,764
-106,623
110,136
-109,967
221,387
220,103
Total liabilities
273,349
266,354
Total equity and liabilities
1,048,395
924,224
The accompanying notes form an integral part of these consolidated financial statements.
Director Director
188,928
687,383
1,063,496
Year ended December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
33
Consolidated Statement of Comprehensive Income Restated Notes 2014 2013 $’000 $’000
Revenue 672,234 663,227
Cost of goods sold
(271,280)
(263,183)
Gross profit 400,954 400,044
Selling and marketing expenses
(117,784)
(124,224)
Administrative expenses
(62,942)
(70,579)
Results from operating activities 220,228 205,241
Finance costs
22
(3,044)
(9,068)
Finance income
108
23
Results from continuing operations 217,292 196,196
Other (expenses) income
23
(10,381)
3,174
Dividend income
24
1,245
126
Impairment charge
9
-
(465)
Foreign exchange (loss) gain
25
(1,180)
21,052
Gain on settlement of financial liability
-
44,445
Gain on disposal of investments
-
83,223
Share of profits from equity-accounted investee, net of tax
-
3,084
Profit before tax 206,976 350,835
Taxation expense
26
(53,550)
(61,817)
Profit for the year
153,426
289,018
Other comprehensive income
Items that will never be reclassified to profit or loss:
Re-measurements of defined benefit asset
11
Related tax
10,655
(2,664)
7,991
9,460
Revaluation of land and buildings
Items that are or may be reclassified to profit or loss:
Foreign currency differences on translation of foreign operations
Other comprehensive income for the year, net of tax
52,783
(13,196)
39,587
--
(69)
596
17,382 40,183
Total comprehensive income for the year
170,808
329,201
Profit for the year attributable to:
Owners of the Company
153,426
289,018
Total comprehensive income attributable to:
Owners of the Company
170,808
329,201
Dividend paid per share 10¢ 23¢
Earnings per share – Basic and Diluted 27
$ 0.75
1.41
The accompanying notes form an integral part of these consolidated financial statements.
34
Angostura Holdings Limited
Year ended December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Consolidated Statement of Changes in Equity
Balance at January 1, 2013, as previously reported
Prior year adjustment to recognise impact of change in accounting policy (Note 31)
Tax impact of prior year adjustment
Restated balance at January 1, 2013
Profit for the year
Other comprehensive income
Share
Other
Retained
Total
Capital Reserves Earnings Equity
$’000
$’000
$’000
$’000
(Note 17)
(Note 18)
118,558
---
118,558
87,533 160,758 366,849
---
12,352
(3,088)
12,352
(3,088)
87,533 170,022 376,113
---
---
289,018 40,183
289,018
40,183
Total comprehensive income for the year
--
--
329,201
329,201
Transactions with equity holders recognised directly in equity
Dividends to equity holders
Depreciation on revalued property
---
(47,444)
405
(47,444)
--
(47,039)
(47,444)
-(405)
-
(405)
Balance at December 31, 2013
118,558
87,128 452,184 657,870
Balance at January 1, 2014
118,558
87,128 452,184 657,870
Profit for the year
Other comprehensive income
Total comprehensive income for the year
Transactions with equity holders recognised directly in equity
Dividends to equity holders
Transfer of revaluation losses on disposal of land and buildings Other reserve movements
---
-9,460
153,426
7,922
153,426
17,382
--
9,460
161,348
170,808
--
(53,632)
(53,632)
---
(3,732)
405
---
(56,959)
(53,632)
-3,732
(405)
-
3,327
Balance at December 31, 2014
118,558
99,915 556,573 775,046
The accompanying notes form an integral part of these consolidated financial statements.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Consolidated Statement of Cash Flows Restated Notes 2014 2013 $’000 $’000
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
206,976
350,835
Adjustments for:
Depreciation charge
8
19,968
19,722
(Gain) loss on disposal of property, plant and equipment
(250)
1,781
Loss on revaluation of land and buildings
10,865
-Gain on settlement of financial liability
-
(44,445)
Gain on disposal of investments
-
(83,844)
Share of profit from equity-accounted investee, net of tax
-
(3,084)
Finance costs
22
3,044
9,068
Finance income
(108)
(23)
Dividend income
24
(1,245)
(126)
Foreign exchange loss (gain)
25
1,180
(21,052)
Operating profit before working capital changes
Change in employee benefits
Change in trade and other receivables
Change in inventories
Change in trade and other payables
Net cash from operating activities
120,530
109,099
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of property, plant and equipment
Proceeds from disposal of investments
Acquisition of property, plant and equipment
8
Adjustments to property, plant and equipment
8
Dividends received
Interest received
72
-(42,730)
(4,660)
1,245
109
523
332,452
(69,455)
996
126
23
Net cash (used in) from investing activities
(45,964)
264,665
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends paid
Proceeds from borrowings
Repayment of borrowings
(53,632)
64,451
(60,000)
(47,444)
-(343,110)
Net cash used in financing activities
(49,181)
(390,554)
Net increase (decrease) in cash and cash equivalents
25,385 (16,790)
Cash and cash equivalents at January 1
148,002 164,792
Cash and cash equivalents at December 31 15 148,002
173,387
The accompanying notes form an integral part of these consolidated financial statements.
35
36
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to Consolidated Financial Statements
1. Reporting Entity
Angostura Holdings Limited (the Company) is a limited liability company incorporated and domiciled in the Republic of Trinidad and Tobago. The address of its registered office is Corner
Eastern Main Road and Trinity Avenue, Laventille, Trinidad and Tobago. The Company has its primary listing on the Trinidad and Tobago Stock Exchange. It is a holding company whose subsidiaries are engaged in the manufacture and sale of rum, ANGOSTURA® aromatic bitters and other spirits, the bottling of beverage alcohol and other beverages on a contract basis, and the production and sale of food products. The consolidated financial statements of the
Company as at and for the year ended December 31, 2014 comprise the Company and its subsidiaries (together referred to as the “Group” and individually as the “Group companies”).
The principal subsidiaries are:
Company
Angostura Limited
Trinidad Distillers Limited
Country of Incorporation
Trinidad and Tobago
Trinidad and Tobago
Percentage Owned
100%
100%
The Company’s ultimate parent entity is C L Financial Limited (CLF), a company incorporated in the Republic of Trinidad and Tobago.
These consolidated financial statements were approved for issue by the Board of Directors on
March 23, 2015.
2. Basis of Accounting
(a) Statement of compliance
The consolidated financial statements have been prepared in accordance with International
Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards
Board (IASB).
Details of the Group’s accounting policies, including changes during the year, are included in Notes 3 and 4.
(b) Basis of measurement
The consolidated financial statements have been prepared on the historical cost basis except for the following items, which are measured on an alternative basis on each reporting date:
-
non-derivative financial instruments at fair value through profit or loss are measured at fair value;
-
available-for-sale financial assets are measured at fair value;
-
net defined benefit asset (obligation) is recognised as fair value of plan assets, adjusted by re-measurements through other comprehensive income, less the present value of the defined benefit obligation adjusted by experience gains (losses) on revaluation, limited as explained in Note 3(i);
-
investments in equity-accounted investees are measured using the equity method;
-
certain freehold/leasehold land and buildings which are measured at fair value less depreciation. (c) Functional and presentation currency
These consolidated financial statements are presented in Trinidad and Tobago dollars, which is the Company’s functional currency. All amounts have been rounded to the nearest thousand, unless otherwise indicated.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
2. Basis of Accounting (continued)
(d) Use of judgements and estimates
In preparing these consolidated financial statements, management has made judgements, estimates and assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the year ended December 31, 2014 is included in the following notes:
Note 11 - Retirement benefit (asset) obligation – Measurement of defined benefit assets and obligations
Note 12 - Inventories – provision for obsolescence
-
Note 14 - Trade and other receivables – provision for impairment
-
Note 19 - Deferred taxation – Utilisation of tax losses
-
Note 30 - Related party transactions – provision for impairment.
Information about critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the consolidated financial statements is included in the following notes:
-
Note 5 - Determination of fair values
Note 29 - Leases – Determination of the lease classification.
3. Significant Accounting Policies
Except for the changes explained in Note 4, the Group has consistently applied the accounting policies as set out in Note 3 to all periods presented in these consolidated financial statements.
(a) Basis of consolidation
(i) usiness combinations
B
Business combinations are accounted for using the acquisition method as at the acquisition date – i.e. when control is transferred to the Group. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately. Transaction costs are expensed as incurred, except if they are related to the issue of debt or equity securities. (ii) Subsidiaries
‘Subsidiaries’ are investees controlled by the Group. The Group ‘controls’ an investee when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases.
37
38
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(a) Basis of consolidation (continued)
(iii) Loss of control
When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related non-controlling interest and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost.
(iv) Interest in equity-accounted investees
Associates are those entities in which the Group has significant influence, but not control or joint control over the financial and operating policies. A joint venture is an arrangement in which the Group has joint control, whereby the Group has rights to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities. Interests in associates and joint ventures are accounted for using the equity method.
They are recognised initially at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income of equity-accounted investees, until the date on which significant influence or joint control ceases.
(v) Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with equity-accounted investees are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
(b) Foreign currency
(i) Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of Group companies at exchange rates at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated to the functional currency at the exchange rate at the reporting date.
Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated to the functional currency at the exchange rate when the fair value was determined. Foreign currency differences are generally recognised in profit or loss.
Non-monetary items that are measured based on historical cost in a foreign currency are not translated.
However, foreign currency differences arising from the translation of available-for-sale equity investments (except on impairment in which case foreign currency differences that have been recognised in other comprehensive income are reclassified to profit or loss) are recognised in other comprehensive income.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(b) Foreign currency (continued)
(ii) Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to the functional currency at the exchange rates at the reporting date. The income and expenses of foreign operations are translated to the functional currency at exchange rates at the dates of the transactions.
Foreign currency differences are recognised in other comprehensive income and accumulated in the retained earnings, except to the extent that the translation difference is allocated to non-controlling interests.
When a foreign operation is disposed of in its entirety or partially such that control, significant influence or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal.
If the Group disposes of part of its interest in a subsidiary but retains control, then the relevant proportion of the cumulative amount is reattributed to non-controlling interests. When the Group disposes of only part of an equity-accounted investee while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.
If the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely to occur in the foreseeable future, then foreign currency differences arising from such item form part of the net investment in the foreign operation. Accordingly, such differences are recognised in other comprehensive income and accumulated in the retained earnings.
(c) Financial instruments
Financial instruments include available-for-sale assets, trade receivables, cash and cash equivalents, borrowings and trade and other payables.
(i) Classification
The Group classifies non-derivative financial assets into the following categories: financial assets at fair value through profit or loss, held-to-maturity financial assets, loans and receivables and available-for-sale assets.
The Group classifies non-derivative financial liabilities into the other financial liabilities category. (ii) Non-derivative financial assets and financial liabilities – Recognition
The Group initially recognises loans and receivables and debt securities issued on the date when they are originated. All other financial assets and financial liabilities are initially recognised on the trade date.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset.
Any interest in such derecognised financial assets that is created or retained by the
Group is recognised as a separate asset or liability.
39
40
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(c) Financial instruments (continued)
(ii) Non-derivative financial assets and financial liabilities – Recognition (continued)
The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.
(iii) Non-derivative financial assets – Measurement
Financial assets at fair value through profit or loss
A financial asset is classified as at fair value through profit or loss if it is classified as held-for-trading or is designated as such on initial recognition. Directly attributable transaction costs are recognised in profit or loss as incurred. Financial assets at fair value through profit or loss are measured at fair value and changes therein, including any interest or dividend income, are recognised in profit or loss.
Held-to-maturity financial assets
These assets are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortised cost using the effective interest method.
Loans and receivables
These assets are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortised cost using the effective interest method except for instances where indications of impairment exist, in which case they are measured at fair value.
Available-for-sale assets
These assets are initially recognised at fair value plus any directly attributable transaction costs.
Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment losses and foreign currency differences on debt instruments, are recognised in other comprehensive income and accumulated in the investment revaluation reserve. When these assets are derecognised, the gain or loss accumulated in equity is reclassified to profit or loss.
(iv) Non-derivative financial liabilities – Measurement
Non-derivative financial liabilities are initially recognised at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortised cost using the effective interest method.
(v) Derecognition
Financial assets
The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or when it transfers the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains substantially all the risks and rewards of ownership and it does not retain control of the financial asset.
On derecognition of a financial asset, the difference between the carrying amount of the asset (or the carrying amount allocated to the portion of the asset transferred), and the sum of:
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(c) Financial instruments (continued)
(v) Derecognition (continued)
(i) the consideration received (including any new asset obtained less any new liability assumed); and
(ii) any cumulative gain or loss that had been recognised in other comprehensive income (OCI). is recognised in profit or loss.
Any interest in transferred financial assets that qualify for derecognition that is created or retained by the Group is recognised as a consolidated asset or liability in the consolidated statement of financial position.
Financial liabilities
The Group derecognises a financial liability when its contractual obligations are discharged, or cancelled, or expired.
(vi) Offsetting
Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to set off the recognised amounts and it intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.
Income and expenses are presented on a net basis only when permitted under IFRS, or for gains and losses arising from a group of similar transactions such as in the Group’s trading activities.
(vii) Amortised cost measurement
The amortised cost of a financial asset or liability is the amount at which the financial asset or liability is measured at initial recognition, minus principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between the initial amount recognised and the maturity amount, minus any reduction for impairment.
(viii) Fair value measurement
‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or, in its absence, the most advantageous market to which the
Group has access at that date. The fair value of a liability reflects its non-performance risk. When available, the Group measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.
If there is no quoted price in an active market, then the Group uses valuation techniques that maximise the use of relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction.
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42
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(c) Financial instruments (continued)
(viii) Fair value measurement (continued)
The best evidence of the fair value of a financial instrument at initial recognition is normally the transaction price – i.e. the fair value of the consideration given or received. If the Group determines that the fair value at initial recognition differs from the transaction price and the fair value is evidenced neither by a quoted price in an active market for an identical asset or liability nor based on a valuation technique that uses only data from observable markets, then the financial instrument is initially measured at fair value, adjusted to defer the difference between the fair value at initial recognition and the transaction price. Subsequently, that difference is recognised in profit or loss on an appropriate basis over the life of the instrument but no later than when the valuation is wholly supported by observable market data or the transaction is closed out.
If an asset or a liability measured at fair value has a bid price and an ask price, then the Group measures assets and long positions at a bid price and liabilities and short positions at an ask price.
The Group recognises transfers between levels of the fair value hierarchy as of the end of the reporting period during which the change has occurred.
(ix) Designation at fair value through profit or loss
The Group has designated financial assets and financial liabilities at fair value through profit or loss in either of the following circumstances:
- The assets or liabilities are managed, evaluated and reported internally on a fair value basis.
- The designation eliminates or significantly reduces an accounting mismatch that would otherwise arise.
Note 5 sets out the amount of each class of financial asset or financial liability that has been designated at fair value through profit or loss. A description of the basis for each designation is set out in the note for the relevant asset or liability class.
(d) Property, plant and equipment
(i) Recognition and measurement
Items of property, plant and equipment, other than land and buildings, are measured at cost less accumulated depreciation and any accumulated impairment losses.
Land and buildings are measured at revalued amount less accumulated depreciation on buildings.
Land and buildings are revalued by independent experts every five years and gains and losses are treated as follows:
- gains are recorded in the revaluation reserve except where a gain directly offsets previous losses on assets, in which case the gain is recognised in profit or loss to the extent that it offsets previous losses. Any additional gains are recognised within the revaluation reserve.
- losses are recognised directly in profit or loss except to the extent that a loss offsets a previous gain on assets in which case the loss is recognised against the revaluation reserve to the extent that it offsets previous gains. Any additional loss is recognised in profit or loss.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(d) Property, plant and equipment (continued)
(i) Recognition and measurement (continued)
If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.
Accumulated net revaluation gains are transferred to profit or loss on disposal of revalued assets.
(ii) Subsequent costs
Subsequent expenditure is capitalised only when it is probable that the future economic benefits associated with the expenditure will flow to the Group.
(iii) Depreciation
Depreciation is based on the market value or cost of an asset less its residual value.
Significant components of individual assets are assessed and if a component has a useful life that is different from the remainder of that asset, that component is depreciated separately.
Land is not depreciated. Depreciation on other assets is calculated using the straightline method for buildings and reducing balance method for all other assets to allocate their cost or revalued amounts less their estimated residual values over their estimated useful lives.
Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term.
The estimated useful lives for the current and comparative years are as follows:
- buildings
25 – 40 years
- plant, machinery and equipment
3 – 15 years
-
casks 6 years
Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
(e) Intangible assets
(i) Research and development
Expenditure on research is recognised in profit or loss as incurred.
Development expenditure is capitalised only if the expenditure can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable and the Group intends to and has sufficient resources to complete development and to use or sell the asset. Otherwise, it is recognised in profit or loss as incurred. Subsequent to initial recognition, development expenditure is measured at cost less accumulated amortisation and impairment losses.
(ii) Other intangible assets
Other intangible assets that are acquired by the Group and have finite useful lives are measured at cost less accumulated amortisation and impairment losses.
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44
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(e) Intangible assets (continued)
(iii) Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in profit or loss as incurred.
(iv) Amortisation
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-line method over their estimated useful lives, and is generally recognised in profit or loss. Goodwill is not amortised.
Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
(f) Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on average cost, and includes expenditure incurred in acquiring the inventories, production or conversion costs, and other costs incurred in bringing them to their existing location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and estimated costs necessary to make the sale.
(g) Impairment
(i) Non-derivative financial assets
Financial assets not classified as at fair value through profit or loss, including any interest in equity-accounted investees, are assessed at each reporting date to determine whether there is objective evidence of impairment.
Objective evidence that financial assets are impaired includes:
-
default or delinquency by a debtor
restructuring of an amount due to the Group on terms that the Group would not consider otherwise
-
indications that a debtor or issuer will enter bankruptcy
adverse changes in the payment status of borrowers or issuers
the disappearance of an active market for a security
observable data indicating that there is a measurable decrease in expected cash flows from a group of financial assets
For an investment in an equity security, objective evidence of impairment includes a significant or prolonged decline in its fair value below its cost. The Group considers a decline of 20% to be significant and a period of nine months to be prolonged.
Available-for-sale assets
Impairment losses on available-for-sale assets are recognised by reclassifying the losses accumulated in the investment revaluation reserve to profit or loss. The amount reclassified is the difference between the acquisition cost (net of any principal repayment and amortisation) and the current fair value, less any impairment loss previously recognised in profit or loss. If the fair value of an impaired available-for-sale
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(g) Impairment (continued)
(i) Non-derivative financial assets (continued) debt security subsequently increases and the increase can be related objectively to an event occurring after the impairment loss was recognised, then the impairment loss is reversed through profit or loss; otherwise, it is reversed through other comprehensive income. Equity-accounted investees
An impairment loss in respect of an equity-accounted investee is measured by comparing the recoverable amount of the investment with its carrying amount. An impairment loss is recognised in profit or loss, and is reversed if there has been a favourable change in the estimates used to determine the recoverable amount.
(ii) Non-financial assets
At each reporting date, the Group reviews the carrying amounts of its non-financial assets (other than biological assets, investment property, inventories and deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill is tested annually for impairment.
For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets (referred to cash generating units or CGUs). Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or
CGU.
An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable amount.
Impairment losses are recognised in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro-rata basis.
An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
(h) Assets held-for-sale
Non-current assets, or disposal groups comprising assets and liabilities, are classified as held-for-sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use.
Such assets, or disposal groups, are generally measured at the lower of their carrying amount and fair value less costs to sell. Any impairment loss on a disposal group is allocated first to goodwill, and then to the remaining assets and liabilities on a pro-rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets, employee benefit assets, investment property or biological assets, which continue to be
45
46
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(h) Assets held-for-sale (continued) measured in accordance with the Group’s other accounting policies. Impairment losses on initial classification as held-for-sale or held-for-distribution and subsequent gains and losses on re-measurement are recognised in profit or loss.
Once classified as held-for-sale, intangible assets and property, plant and equipment are no longer amortised or depreciated, and any equity-accounted investee is no longer equityaccounted.
(i) Employee benefits
Retirement benefits for employees are provided by defined benefit and define contribution schemes. The assets of the define benefit scheme are held in a consolidated trusteeadministered fund. The pension plan is funded by contributions from the Group and the employees, taking account the recommendations of independent qualified actuaries.
(i) Defined contribution plans
Obligations for contributions to defined contribution plans are expensed as the related service is provided. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. The Group currently has a defined contribution plan for post retirement medical benefits.
(ii) Defined benefit plans
The Group’s net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.
The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Group, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.
Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in other comprehensive income. The Group determines the net interest expense (income) on the net defined benefit (liability) asset for the period, by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the net defined benefit (liability) asset, taking into account any changes in the net defined benefit
(liability) asset during the period, as a result of contributions and benefit payments.
Net interest expense and other expenses related to defined benefit plans are recognised in profit or loss.
When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Group recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.
(iii) Other long-term employee benefits
The Group’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(i) Employee benefits (continued)
(iii) Other long-term employee benefits (continued) current and prior periods. That benefit is discounted to determine its present value.
Remeasurements are recognised in profit and loss in the period in which they arise.
(iv) Termination benefits
Termination benefits are expensed at the earlier of when the Group can no longer withdraw the offer of those benefits and when the Group recognises costs for a restructuring. If benefits are not expected to be settled wholly within 12 months of the end of the reporting period, then they are discounted to their present value.
(v) Short-term employee benefits
Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.
(j) Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as a finance cost.
(k) Revenue
(i) Goods sold
Revenue from the sale of goods in the course of ordinary activities is measured at the fair value of the consideration received or receivable, net of excise taxes, returns, trade discounts and volume rebates. Revenue is recognised when persuasive evidence exists, usually in the form of an executed sales agreement, that the significant risks and rewards of ownership have been transferred to the customer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, there is no continuing management involvement with the goods, and the amount of revenue can be measured reliably.
If it is probable that discounts will be granted and the amount can be measured reliably, then the discount is recognised as a reduction of revenue as the sales are recognised. The timing of the transfer of risks and rewards varies depending on the individual terms of the sales agreement.
(ii) Services
If the services under a single arrangement are rendered in different reporting periods, then the consideration is allocated on a relative fair value basis between the different services, across the reporting periods.
The Group recognises revenue from rendering of services in proportion to the stage of completion of the transaction at the reporting date. The stage of completion is assessed based on surveys of work performed.
47
48
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(l) Leases
Determining whether an arrangement contains a lease
At inception of an arrangement, the Group determines whether the arrangement is or contains a lease. At inception or on reassessment of an arrangement that contains a lease, the Group separates payments and other consideration required by the arrangement into those for the lease and those for other elements on the basis of their relative fair values. If the Group concludes for a finance lease that it is impracticable to separate the payments reliably, then an asset and a liability are recognised at an amount equal to the fair value of the underlying asset; subsequently, the liability is reduced as payments are made and an imputed finance cost on the liability is recognised using the Group’s incremental borrowing rate. Lease payments
Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.
Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. In cases where leases provide financing for property, plant and equipment, the finance cost associated with such leases is recognised within the cost of the related assets.
(m) Finance income, finance costs and dividend income
The Group’s finance income and finance costs include:
-
-
-
interest income interest expense dividend income.
Interest income or expense is recognised using the effective interest method. Dividend income is recognised in profit or loss on the date that the Group’s right to receive payment is established.
(n) Taxation
Income tax expense comprises current and deferred tax. It is recognised in profit or loss except to the extent that it relates to a business combination, or items are recognised directly in equity or in other comprehensive income.
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to tax payable or receivable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also includes any tax arising from dividends.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:
-
temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss;
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
temporary differences related to investments in subsidiaries and joint arrangements to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
taxable temporary differences arising on the initial recognition of goodwill.
A deferred tax asset is recognised for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. For this purpose, the carrying amount of investment property measured at fair value is presumed to be recovered through sale, and the Group has not rebutted this presumption.
Deferred tax assets and liabilities are offset only if certain criteria are met.
(o) Discontinued operations
A discontinued operation is a component of the Group’s business, the operations and cash flows of which can be clearly distinguished from the rest of the Group and which:
-
represents a separate major line of business or geographical area of operations;
is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations; or
is a subsidiary acquired exclusively with a view to re-sale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria to be classified as held-for-sale. When an operation is classified as a discontinued operation, the comparative statement of profit or loss and other comprehensive income is re-presented as if the operation had been discontinued from the start of the comparative year.
(p) Segment reporting
Segment results that are reported to the Chief Executive Officer, Executive Management team, and those charged with Governance include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise assets and liabilities, finance costs and income, other income and expenses, dividend income, impairment charges, foreign exchange gains and losses, fair value gains and losses, gain on financial liability, gain on disposal of investment, share of profits from equity-accounted investee, net of tax, and tax expenses and income.
(q) Share capital
Ordinary shares
Incremental costs directly attributable to the issue of ordinary shares net of any tax effects, are recognised as a deduction from equity.
49
50
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
3. Significant Accounting Policies (continued)
(q) Share capital (continued)
Repurchase and reissue of share capital (treasury shares)
When share capital recognised as equity is repurchased, the amount of the consideration paid, which includes directly attributable costs, net of any tax effects, is recognised as a deduction from equity. Repurchased shares are classified as treasury shares and are classified within share capital as a deduction. When treasury shares are sold or reissued subsequently, the amount received is recognised as an increase in equity, and the resulting surplus or deficit on the transaction is presented within share premium.
(r) New standards and interpretations not yet adopted
A number of new standards, amendments to standards and interpretations are effective for annual periods beginning after January 1, 2014, and have not been applied in preparing these consolidated financial statements. Those that may be relevant to the Group are set out below. The Group does not plan to adopt these standards early.
-
IFRS 9 Financial Instruments
IFRS 9, published in July 2014, replaces the existing guidance in IAS 39 Financial
Instruments: Recognition and Measurement. IFRS 9 includes revised guidance on the classification and measurement of financial instruments, including a new expected credit loss model for calculating impairment on financial assets, and the new general hedge accounting requirements. It also carries forward the guidance on the recognition and derecognition of financial instruments from IAS 39.
The Group is assessing the potential impact on its consolidated financial statements resulting from the application of IFRS 9.
-
IFRS 15 Revenue from Contract with Customers
IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including IAS 18 Revenue, IAS 11 Construction Contracts and IFRIC 13 Customer
Loyalty Programmes.
The Group is assessing the potential impact on its consolidated financial statements resulting from the application of IFRS 15.
4. Change in Accounting Policy
The Group has adopted the following new standards and amendments to standards, including any consequential amendments to other standards, with a date of initial application of January
1, 2014:
a. Investment entities (Amendments to IFRS 10, IFRS 12 and IAS 27)
b. Offsetting financial assets and financial liabilities (Amendments to IAS 32)
c. Recoverable amount disclosures for non-financial assets (Amendments to IAS 36)
d. Novation of derivatives and continuation of hedge accounting (Amendments to IAS 39)
e. IFRIC 21 Levies
f. Defined benefit plans: Employee contributions (Amendments to IAS 19).
Investment entities (Amendments to IFRS 10, IFRS 12 and IAS 27)
The amendments provide a consolidation exception for investment funds, to align external financial reporting with the way in which investment funds operate. A qualifying investment
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
4. Change in Accounting Policy (continued) entity is required to account for investments in controlled entities – as well as investments in equity-accounted investees – at fair value through profit or loss (FVTPL); the only exception being subsidiaries that are considered an extension of the investment entity’s investment activities. The consolidation exception is mandatory – not optional. The standard provides characteristics to be met by entities to qualify for classification as investment entities, and sets out new disclosures which include quantitative data about the investment entity’s exposure to risks arising from its unconsolidated subsidiaries. The parent of an investment entity (that itself is not an investment entity) is still required to consolidate all subsidiaries.
The change did not have any impact on the Group’s consolidated financial statements.
Offsetting financial assets and financial liabilities (Amendments to IAS 32)
The changes to IAS 32 did not have any impact on the Group’s consolidated financial statements.
Recoverable amount disclosures for non-financial assets (Amendments to IAS 36)
The IASB has issued amendments to reverse the unintended requirement in IFRS 13 Fair
Value Measurement to disclose the recoverable amount of every cash-generating unit to which significant goodwill or indefinite-lived intangible assets have been allocated. Under the amendments, recoverable amount is required to be disclosed only when an impairment loss has been recognised or reversed.
The change did not have any impact on the Group’s consolidated financial statements.
Novation of derivatives and continuation of hedge accounting (Amendments to IAS 39)
IAS 39 requires an entity to discontinue hedge accounting if the derivative hedging instrument is novated to a clearing counterparty – unless the hedging instrument is being replaced as part of the entity’s original documented hedging strategy. This is because novation involves a termination of expiration of the original hedging instrument, and this requires cessation of hedge accounting. The amendments add a limited exception to IAS 39, to provide relief from discontinuing an existing hedging relationship when a novation that was not contemplated in the original hedging documentation meets specific criteria.
The change did not have any impact on the Group’s consolidated financial statements.
IFRIC 21 Levies
A new interpretation has provided more clarity as to when a liability for a levy should be recognised.
The interpretation defines a levy as an outflow from an entity imposed by a government in accordance with legislation, and provides guidance on accounting for levies in accordance with
IAS 37. The entity recognises a liability for a levy when – and only when – the triggering event specified in the legislation occurs, even if it has no realistic opportunity to avoid the triggering event. The change did not have any impact on the Group’s consolidated financial statements.
Defined benefit plans: Employee contributions (Amendments to IAS 19)
The practical expedient addresses an issue that arose when amendments were made in
2011 to the previous pension accounting requirements. Some defined benefit plans require contributions not only from the employer, but also from employees or third parties. Under previous pension accounting, contributions from employees or third parties that were linked to service were generally deducted from the service cost in the period in which they were received.
They were not included in calculating the defined benefit obligation. The amendments introduce a relief that will reduce the complexity of accounting for certain contributions from employees or third parties, provided they meet certain criteria. When contributions are eligible for the practical expedient, an entity is permitted (but not required) to recognise them as a reduction of the service cost in the period in which the related service is rendered. The amendments also
51
52
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
4. Change in Accounting Policy (continued) clarify how service-linked contributions from employees or third parties should be included in determining net current service cost and the defined benefit obligation.
The change did not have any impact on the Group’s consolidated financial statements.
Inventories – provision for aging losses
The Group previously had a policy of providing for expected losses of alcohol volume from evaporation during the aging process. The provision was calculated based on evaporation rates of various blends, with movements recognised monthly according to stock on hand. During the year, an exercise was performed to physically verify the volume of aged stock held, thereby establishing the exact evaporation losses from aging. It is the Group’s intention to repeat this exercise periodically to ensure that evaporation losses are consistently confirmed, as opposed to estimating losses using the above parameters. In so doing, the Group has eliminated the need for a provision for expected aging losses. Accordingly, a prior year adjustment has been recognised in the consolidated financial statements to remove the provision for aging losses, and the impact of this adjustment is explained further in Note 31.
5. Determination of Fair Values
A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the methods described below. Where applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.
a) Fair value measurement
(i) Property, plant and equipment
The fair value of property, plant and equipment recognised as a result of a business combination is the estimated amount for which property could be exchanged on the acquisition date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably.
The fair value of items of plant, equipment, fixtures and fittings is based on the market approach and cost approaches using quoted market prices for similar items when available and depreciated replacement cost when appropriate. Depreciated replacement cost reflects adjustments for physical deterioration as well as functional and economic obsolescence. (ii) Intangible assets
The fair value of patents and trademarks acquired in a business combination is based on the discounted estimated royalty payments that are expected to be avoided as a result of the patents or trademarks being owned. The fair value of customer relationships acquired in a business combination is determined using the multi-period excess earnings method, whereby the subject asset is valued after deducting a fair return on all other assets that are part of creating the related cash flows.
The fair value of other intangible assets is based on the discounted cash flows expected to be derived from the use and eventual sale of the assets.
(iii) Inventories
The fair value of inventories acquired in a business combination is determined based on the estimated selling price in the ordinary course of business less the estimated costs of completion and sale, and a reasonable profit margin based on the effort required to complete and sell the inventories.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
5. Determination of Fair Values (continued)
a) Fair value measurement (continued)
(iv) Equity and debt securities
The fair values of investments in equity and debt securities are determined with reference to their quoted closing bid price at the measurement date, or if unquoted, determined using a valuation technique. Valuation techniques employed include market multiples and discounted cash flow analysis using expected future cash flows and a market-related discount rate. Subsequent to initial recognition, the fair values of heldto-maturity investments are determined for disclosure purposes only.
(v) Trade and other receivables
The fair values of trade and other receivables, excluding construction work in progress, are estimated at the present value of future cash flows, discounted at the market rate of interest at the measurement date. Short-term receivables with no stated interest rate are measured at the original invoice amount if the effect of discounting is immaterial.
Fair value is determined at initial recognition and, for disclosure purposes, at each annual reporting date.
(vi) Other non-derivative financial liabilities
Other non-derivative financial liabilities are measured at fair value, at initial recognition and for disclosure purposes, at each annual reporting date. Fair value is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the measurement date.
In respect of the liability component of convertible notes, the market rate of interest is determined with reference to similar liabilities that do not have a conversion option.
For finance leases the market rate of interest is determined with reference to similar lease agreements.
(vii)
Contingent consideration
The fair value of contingent consideration arising in a business combination is calculated using the income approach based on the expected payment amounts and their associated probabilities. When appropriate, it is discounted to present value.
b) Valuation models
The Group’s accounting policy on fair value measurements is discussed in accounting policy
3(c)(viii).
The Group measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements.
Level 1: Quoted market price (unadjusted) in an active market for an identical instrument.
Level 2: Valuation techniques based on observable inputs, either directly (i.e. prices) or indirectly (i.e. derived from prices). This category includes instruments valued using: quoted market prices in active markets for similar instruments; quoted prices for identical or similar instruments in markets that are considered less than active; or other valuation techniques where all significant inputs are directly or indirectly observable from market data.
Level 3: Valuation techniques using significant unobservable inputs. This category includes all instruments where the valuation technique includes inputs not based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation.
This category includes instruments that are valued based on quoted prices for similar instruments where significant unobservable adjustments or assumptions are required to reflect differences between the instruments.
53
54
Angostura Holdings Limited
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
5. Determination of Fair Values (continued)
(c) Financial instruments measured at fair value – fair value hierarchy
At year end, the following financial instrument was measured at fair value. Fair Level 1
Level 2
Level 3
Value
2014
$’000 $’000 $’000 $’000
Equity securities
--
109
--
109
--
109
--
109
2013
Equity securities
(d) Financial instruments not measured at fair value Total Fair Carrying Level 1
Level 2
Level 3
Value
Amount $’000 $’000 $’000 $’000 $’000
As at December 31, 2014
Assets held-for-sale
Trade receivables
Cash and cash equivalents
Trade and other payables
--
--
--
--
As at December 31, 2013
Assets held-for-sale
Trade receivables
Cash and cash equivalents
Trade and other payables
-----
1,423
232,129
173,387
106,623
--
--
--
--
3,598
190,984
148,002
109,967
---
---
1,423
232,129
173,387
106,623
1,423
232,129
173,387
106,623
3,598
190,984
148,002
109,967
3,598
190,984
148,002
109,967
The fair value of debt securities is estimated using discounted cash flow techniques, applying the rates that are offered for debt securities of similar maturities and terms.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
6. Financial Risk Management
Overview
The Group has exposure to the following risks from its use of financial instruments:
-
-
-
credit risk liquidity risk capital risk.
This Note presents information about the Group’s exposure to each of the above risks, the
Group’s objectives, policies and processes for measuring and managing risk, and the Group’s management of capital. Further quantitative disclosures are included throughout these consolidated financial statements.
Risk management framework
The Executive Management has set up a Risk Management Committee to institute a formal Risk
Management program to ensure that key risks are actively and continuously identified, managed, monitored and reported. The aim is to establish a risk management culture and communicate the importance of risk management activities to all staff and specify the responsibilities and accountability for risk management throughout operations. Input is obtained from all key stakeholders including management, those charged with Governance, legal counsel, internal and external auditors. The Risk Management Committee also considers the emergence of new risks, and operational management is required to report on such risks and assist in the development of mitigating strategies to address them.
The Group’s Audit Committee oversees how management monitors compliance with the Group’s policies and procedures. The Group’s Audit Committee is assisted in its oversight role by Internal
Audit. Internal Audit undertakes both regular and ad hoc reviews of controls and procedures, the results of which are reported to the Audit Committee.
As part of the overall risk management process, the Risk Management Committee has reviewed the activities of the Company in consideration of its natural and commercial operating environments and has identified the major risks faced by the Company.
In order to better focus the risk management efforts, risks have been classified into the following major categories and assessed on the basis of residual exposure after consideration of the level of management and control activities designed and implemented to specifically mitigate against them:
- financial and reporting
- operational
- compliance
- strategic.
The inherent risk levels (defined by their potential impact, and likelihood of occurrence in the absence of controls) are compared to management control levels to determine the appropriate risk response specifically, whether risks should be monitored or accepted or conversely, whether controls should be monitored or improved.
The Risk Management Committee manages and updates the Risk Register which details for each core functional area, the major risks identified, key drivers and metrics related to each risk, risk owner (with direct responsibility for managing the risk), the response adopted, type and frequency of monitoring, and action plan for implementation of the documented risk response.
Management notes that the risk management process is dynamic and requires ongoing review and revision to enable the Group to maintain a position of strength in relation to inherent and residual risks. The process is continuously refined in response to environmental changes from both a natural and operating perspective.
55
56
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
6. Financial Risk Management (continued)
(a) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables from customers.
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the demographics of the Group’s customer base, including the default risk of the industry and country in which customers operate, as these factors may have an influence on credit risk.
The Group has no significant concentrations of credit risk. It has policies in place to ensure that credit sales of products are made to customers with an appropriate credit history. The
Group’s Credit Committee has established a credit policy under which each new customer is analysed for creditworthiness before the Group’s standard payment and delivery terms and conditions are offered. The Group’s review includes external ratings when available, and in some cases bank references. Purchase limits are established for each customer and are reviewed on an ongoing basis. Customers that fail to meet the Group’s benchmark creditworthiness may transact with the Group only on a cash basis.
For the purposes of credit risk assessment, customers are segregated into categories and reviews take account of the specific trading relationship of each category of debtor with the Company. Credit risk assessment presents significant implications for two major categories of debtors: trade receivables and related party receivables.
Trade receivables – Management assesses the creditworthiness of major trade customers on an ongoing basis and revises credit limits based on the findings of analyses performed.
Discretionary allowances are made for individual customers where temporary breaches in credit limits are deemed acceptable. Preferred customers who trade in high volumes typically benefit from adjustments to their credit terms at the year-end.
Related party receivables – Trade with related parties occurs on terms comparable with those offered to third parties. Significant transactions falling outside the scope of regular trade require approval by the Board of Directors. Transactions undertaken with related parties are monitored during the year to ensure agreement of balances by relevant parties.
Credit risk with banks and financial institutions is managed through the purchase and sale of foreign currency, transfer of balances between financial institutions to take advantage of interest rates and where beneficial to the Company, investment in short term, easily convertible, liquid assets. In addition, the Group maintains banking relationships with prominent local and foreign banks with a proven history of stability and corporate resilience.
The financial results of banking institutions are monitored by Management and frequent liaison with representatives of banks ensures early warnings are received in the event that banks encounter the risk of financial or operational difficulties.
The table below shows the carrying values at the reporting date of major categories of debtors. Trade receivables:
Third party – net (Note 14)
Related party – net (Note 30(v))
2014 2013
$’000 $’000
228,882
3,247
188,181
2,803
232,129
190,984
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
6. Financial Risk Management (continued)
(a) Credit risk (continued)
Information on the exposures to credit risk is provided in Note 14.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables.
(b) Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the
Group’s reputation. Due to the dynamic nature of the underlying businesses, the Group aims to maintain flexibility in funding by keeping committed credit lines available.
The Group uses activity-based standard costing to cost its products and services, which assists it in monitoring cash flow requirements and optimising its cash return on investments. Typically the Group ensures that it has sufficient cash on hand to meet expected working capital requirements and operational expenses including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters. Information on the maturity profile of significant contractual obligations is provided in Notes 18 and 20.
(c) Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.
(i) Currency risk
The Group operates internationally and is exposed to foreign exchange currency risk arising from various currency exposures, primarily with respect to the US dollar, Euro and Pound Sterling. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.
As at the year end all debt carried by the Group was held in the functional currency of the group and as such, no currency exposure was noted in respect of borrowings.
The Group considers revenue and receivables in US dollars to be the greatest source of currency risk. The primary mitigating factor against this exposure is the Group’s
US dollar denominated purchases and payables. The group is a marginal net earner of US dollars.
(ii) Price risk
The Group does not have a policy for managing price risk arising from the investments held in foreign currencies. No significant price risk in respect of such investments has been identified at the year-end since all investments in foreign currencies have been fair valued and foreign operations are not significant to the Group.
(iii) Interest rate risk
The Group had no significant interest-bearing assets or liabilities at the year end.
Differences in contractual re-pricing or maturity dates and changes in interest rates expose the Group to interest rate risk. The Group’s exposure to interest rate risks on its financial assets and liabilities are disclosed in Notes 15 and 19 respectively.
57
58
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
6. Financial Risk Management (continued)
(c) Market risk (continued)
The Group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration refinancing, renewal of existing positions, alternative financing and hedging. Based on these scenarios, the Group calculates the impact on profit and loss of a defined interest rate shift. For each simulation, the interest rate shift is determined based on expected market movements and anticipated changes arising from ongoing negotiations. The scenarios are run only for liabilities that represent the major interest-bearing positions.
The Group assesses its interest burden and ranks its debt from high to low in relation to the demands placed on working capital for servicing. High interest facilities and facilities denominated in volatile currencies are considered first for refinancing followed by lower interest rate borrowings and borrowings denominated in stable currencies or the functional currency of the Group.
(d) Capital risk
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders, and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including ‘current and non-current borrowings’ as shown in the consolidated statement of financial position) less cash and cash equivalents.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
7. Segment Information
Management has determined the operating segments based on the reports reviewed by Executive
Management to make strategic decisions.
The segment results for the year ended December 31, 2014 are as follows:
Branded Trade Commodity Trade
Total
$’000 $’000 $’000
Revenue
550,593
121,641
672,234
Results from operating activities
211,187
9,041
220,228
Finance cost
Finance income
--
--
--
--
Results from continuing operations
Other expense
Dividend income
Foreign exchange loss
--
--
--
--
-- 217,292
--
(10,381)
--
1,245
--
(1,180)
Group profit before tax
Tax expense
--
--
-- 206,976
--
(53,550)
(3,044)
108
Profit for the year
153,426
The assets and liabilities of the Group are not allocated by segment.
The segment results for the year ended December 31, 2013 are as follows: Restated Branded Trade Commodity Trade
Total
$’000 $’000 $’000
Revenue
546,237
116,990
663,227
Results from operating activities
196,629
8,612
205,241
--
--
--
--
Finance cost
Finance income
(9,068)
23
Results from continuing operations
--
-- 196,196
Other income
--
--
3,174
Dividend income
--
--
126
Impairment charges
(465)
Foreign exchange gains
--
--
21,052
Gain on financial liability
44,445
Gains on disposal of investments
--
--
83,223
Share of profits from equity-accounted investee, net of tax
--
--
3,084
Profit before tax
Tax expense
--
--
-- 350,835
--
(61,817)
Profit for the year
289,018
The assets and liabilities of the Group are not allocated by segment.
59
60
Angostura Holdings Limited
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
8. Property, Plant and Equipment
Plant,
Land and
Machinery & Casks &
Assets in
Buildings
Equipment
Pallets
Progress
Total
$’000 $’000 $’000 $’000 $’000
December 31, 2014
Cost or revaluation
Balance as at January 1
Additions
Transfers
Disposals
Adjustments
Revaluation charge
Accumulated depreciation
Balance as at January 1
Depreciation charge
Disposals
(9,605)
(2,873)
--
217,489
30,789
80,592
506,345
(141,350)
(14,313)
1,465
(19,093)
(2,536)
3,076
----
(170,048) (19,722) 4,541
--
(185,229)
Balance as at December 31 At December 31, 2013
Cost or valuation
Accumulated depreciation
(12,478)
(154,198)
(18,553)
177,475
(12,478)
217,489
(154,198)
30,789
(18,553)
80,592
--
506,345 (185,229)
Net book value
164,997
12,236
80,592
321,116
63,291
The Group’s land and buildings are subject to revaluation every five years and were last revalued on December 31, 2014 by qualified independent experts. The next revaluation is due in 2019 in accordance with the accounting policy of the Group. Valuations were done on the basis of market value. Revaluation surpluses and losses were recognised within ‘revaluation surpluses’ in other reserves (Note 18) or ‘other expenses’ in profit or loss, as described in Note 3(d)(i).
9. Available-for-Sale Assets
2014 2013
$’000 $’000
Balance at January 1
Impairment charge
Balance at December 31
109
--
574
(465)
109
109
Available-for-sale assets include the following:
Listed equity securities – English speaking Caribbean
Unlisted securities
1
108
1
108
109
109
62
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
10. Investment in Joint Venture
C
ompany
Country of incorporation
Tobago Plantations Limited
Percentage Owned
2014 2013
Trinidad and Tobago
50%
50%
The carrying value of the joint venture operation was reduced to nil in 2007 when the Group’s share of the operating losses incurred by the joint venture surpassed the carrying value of the investment. It is the Group’s policy to recognise a share of losses only to the extent of its investment in the joint venture operation (Note 3(a)(iv)).
11. Retirement Benefit (Asset) Obligation
i. Consolidated Statement of Financial Position The amounts recognised in the consolidated statement of financial position are determined as follows: Fair value of plan assets
Deferred benefit obligation
The amounts recognised in the consolidated statement of financial position are represented by: 2014 2013 $’000 $’000
Net defined benefit asset
Net defined benefit liability:
- Asset-backed post-retirement benefit obligation
- Cash funded post-retirement benefit obligation
(75,829)
(64,714)
1,512
9,603
(65,809)
2,333
9,925
(53,551)
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
11. Retirement Benefit (Asset) Obligation (continued) ii. Movement in net defined benefit (asset) liability
Included in profit and loss
Current service cost
Past service cost
Interest cost (income)
Administrative expenses
10,285
1,447
13,088
--
10,414
-12,286
--
-
-(16,002)
264
-
-(12,680)
269
24,820
22,700
(15,738)
(12,411)
Included in other comprehensive income
Remeasurement (gain) loss:
Actuarial (gain) loss arising from
experience adjustments
(6,910)
Return on plan assets
excluding interest income
-
Other
Contributions paid by employer and members
Benefits paid Balance as at December 31
921
--
--
--
(53,551)
(2,003)
10,285 1,447
(2,914)
264
10,414
-(394)
269
9,082
(6,910)
10,289
921
(3,745)
(53,704)
(3,745) (53,704)
(6,910)
921 (3,745)
(53,704)
(10,655) (52,783)
3,170
(12,110)
3,121
(10,598)
(12,138)
9,948
(10,403)
10,366
(7,428)
(2,162)
(7,282)
(1,772)
(37)
(9,590)
(9,054)
(8,940)
(319,831) (253,679)
(9,017)
275,250 266,280
(650)
(339,964) (319,831)
(64,714) (53,551)
63
64
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
11. Retirement Benefit (Asset) Obligation (continued) iii. Summary of Principal actuarial assumptions as at 31 December
2014 2013
Discount rate
Average individual salary increase
Future pension increases
5.0%
4.5%
0.0%
5.0%
4.5%
0.0%
Assumptions regarding future mortality rates are based on the published mortality tables.
The life expectancies underlying the value of the defined benefit obligation as at December
31, 2014 are as follows:
2014 2013
Life expectancy at age 60 for current pensioner in years:
- Male
- Female
Life expectancy at age 60 for current members age 40 in years:
- Male
- Female
iv. Asset allocation
21.8
25.6
21.8
25.6
21.8
25.6
21.8
25.6
2014 2013
$’000 $’000
Insured managed fund contract
Endowment policies
Immediate annuity policies
335,228
1,416
3,248
315,045
1,348
3,438
339,964
319,831
The value of the Plan’s investment in the managed fund contract at December 31, 2014 was provided by the insurer (CLICO).
The Plan’s assets are mostly invested in an insured managed fund contract with CLICO. The value of this policy is reliant on the financial strength of CLICO. Other than for the purchase of immediate annuity polices for some of the Plan’s pensioners, there are no asset-liability matching strategies used by the Plan. Plan assets are comprised as follows:
Equity
Debt securities
Other (short-term securities)
2014 2013
61.4 65.2
23.8
20.9
14.8
13.9
12.1% (2013:12.0%) of the managed fund assets are invested in the Company’s ordinary shares. December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
11. Retirement Benefit (Asset) Obligation (continued)
v. Sensitivity Analysis
The calculation of the defined benefit obligation is sensitive to the assumptions used.
The following table summarises how the defined benefit obligation as at December
31, 2014 would have changed as a result of a change in the assumptions used.
Discount rate
Future salary increase
2014 2013
$’000 $’000
1% pa
1% pa decrease increase
47,163
(13,678)
45,808
(11,828)
An increase of 1 year in the assumed life expectancies shown above would increase the defined benefit obligation at the year end by $4,013 thousand (2013: $3,823 thousand). vi. Funding
The Group meets the balance of the cost of funding the defined pension plan and must pay contributions at least equal to those paid by the members, which are fixed. The funding requirements are based on the regular (at least every 3 years) actuarial valuations of the
Plan and the assumptions used to determine the funding required may differ from those set out above. The Group expects to pay $9,029 thousand to the pension plan during 2015.
12. Inventories
2014 2013
$’000 $’000
Raw and packaging materials
Work in progress
Finished goods
73,626
116,153
31,496
68,332
96,655
36,105
Provision for obsolescence
221,275
(1,350)
201,092
(2,461)
219,925
198,631
13. Assets Held-for-Sale
Balance at January 1
Additions
Transfer to property, plant and equipment
Balance at December 31
2014 2013
$’000 $’000
3,598
-(2,175)
1,423
3,558
40
-3,598
There were no impairment provisions on assets held-for-sale at the year-end (2013: $NIL).
65
66
Angostura Holdings Limited
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
14. Trade and Other Receivables
2014 2013
$’000 $’000
Trade receivables
Provision for impairment of trade receivables
243,570
(14,688)
201,334
(13,153)
Receivables from related parties – net (Note 30 (v))
228,882 188,181
3,247
2,803
Trade receivables – net
Prepayments and other receivables
Taxation recoverable
232,129
190,984
502
754
8,948 2,442
241,579
194,180
There is no concentration of credit risk with respect to trade receivables as the Group has a large number of customers that are internationally dispersed.
The aging of trade and other receivables at the year-end was: Gross Impairment
Gross Impairment 2014 2014
2013 2013 $’000 $’000
$’000 $’000 Not past due
Past due 0 – 30 days
Past due 31 – 60 days
Past due 61 – 90 days
Past due 90 – 120 days
Past due more than 120 days
158,985
61,317
17,014
2,234
1,063
22,586
--
--
--
--
--
(21,620)
263,199 (21,620)
132,776
44,611
5,007
1,620
865
29,498
-----(20,197)
214,377 (20,197)
As of December 31, 2014, trade receivables of $966 thousand (2013: $9,301 thousand) were more than 120 days past due but not impaired. This balance related to a number of third party customers for whom there was no history of default and management held the opinion that these amounts were collectible. Impaired receivables relate primarily to wholesalers and retailers that have defaulted on payments. The ageing of these receivables is as disclosed above.
The carrying amounts of the Group’s trade and other receivables are denominated in the following currencies:
2014 2013
$’000 $’000
United States dollar
Trinidad and Tobago dollar
Canadian dollar
Euro
91,857
148,406
43
1,273
75,773
117,013
43
1,351
241,579
194,180
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
14. Trade and Other Receivables (continued)
Movements during the year in the provision for impaired trade receivables were as follows:
2014 2013
$’000 $’000
At January 1
Reversal of provisions
Increase in provision
13,153
-1,535
At December 31
Related party provisions (Note 30(v))
14,688
6,932
13,153
7,044
Total provision for impaired trade and other receivables
21,620
20,197
13,497
(344)
--
The creation and release of provision for impaired receivables have been included in ‘selling and marketing expenses’ in the consolidated statement of comprehensive income. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash. None of the classes within trade and other receivables contain impaired assets other than as disclosed above.
The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. None of the trade and other receivables of the Group are pledged as collateral for borrowings (2013: $NIL).
15. Cash and Cash Equivalents
Cash at bank and in hand
2014 2013
$’000 $’000
173,387
148,002
The Group had no material exposure to interest rate risk arising from cash and cash equivalents held at the year-end.
16. Share Capital
2014
2013
Number of shares in issue (000)
Treasury shares (000)
206,277
(457)
206,277
(457)
205,820
205,820
Ordinary shares ($’000)
Treasury shares ($’000)
119,369
(811)
119,369
(811)
118,558
118,558
67
68
Angostura Holdings Limited
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
17. Other Reserves
Revaluation
Capital
Surplus Reserves Total
$’000 $’000 $’000
Balance at January 1, 2013
Other reserve movements – depreciation on revalued land and buildings
Balance at December 31, 2013
77,877 9,656 87,533
-77,877
(405)
9,251
(405)
87,128
Balance at January 1, 2014
77,877 9,251 87,128
Revaluation of land and buildings
9,460
-
-Other reserve movements – depreciation on revalued land and buildings
-
(405)
(405)
Transfer of revaluation losses to retained earnings on disposal of land and buildings 3,732
-
3,732
Balance at December 31, 2014
91,069
8,846
99,915
Revaluation surplus represents the gain on revaluation of land and buildings of certain of the Group companies. Land and buildings were revalued on December 31, 2014 by qualified independent experts in accordance with the Group’s accounting policies. As part of the 2014 revaluation exercise further disaggregation of the asset class was obtained and revealed that for certain of the Group’s land and buildings, revaluation losses were carried in the reserve. These losses amounted to $3,732 thousand, and have been reclassified to retained earnings in 2014.
Capital reserves represent general reserves as well as accumulated foreign exchange gains
(losses) recognised in equity upon revaluation of the Group’s interest in foreign operations.
18. Borrowings
Unsecured borrowings
Facilities held by the Group are as follows:
Demand loans
Trade revolver
2014 2013
$’000 $’000
114,764
110,136
50,000
110,136
64,764
-114,764
110,136
Demand loans are subject to interest at a fixed rate, payable in quarterly instalments. Outstanding principal will mature in less than twelve months.
The trade revolver is subject to floating interest, payable quarterly and re-set every six months.
Principal payments are due six months after each drawdown.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
18. Borrowings (continued)
The effective interest rates on debt servicing for the year were as follows:
Type of borrowing
2014
TT$
US$
€
Unsecured borrowings
2.2%
--
--
2013
Unsecured borrowings
Secured borrowings
3.4%
--
--
4.8%
1.5%
--
The carrying amounts of short-term borrowings approximate their fair value.
2014 2013
$’000 $’000
Trinidad and Tobago dollar
Pound sterling
114,628
136
110,000
136
114,764
110,136
6 months or less
Between 6 months to 1 year
Between 1 – 5 years
50,492
14,000
136
110,000
-136
Fixed rate borrowings
64,764 110,136
50,000
--
The exposure of the Group’s borrowings to interest rate changes and the contractual re-pricing dates at the reporting date are as follows:
114,764
110,136
50,628
64,000
136
110,000
-136
114,766
110,136
The contractual cash flows are as follows:
Due in 6 months
Between 6 months and 1 year
Over 1 year There were no loans from related parties at the year end (2013: NIL).
69
70
Angostura Holdings Limited
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
19. Deferred Taxation
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. The
Group does not offset deferred tax assets and deferred tax liabilities within the statement of financial position.
i. The movement in deferred tax assets and liabilities during the year is as follows: (Charged) Credited to
Charged
Provisions comprise mainly the estimated costs related to legal matters and other amounts for which expenses are expected to be incurred in the future.
Accruals comprise amounts due in respect of known obligations of the Group at the year-end.
Trade and other payables are expected to be settled in the short term.
21. Operating Profit
Included in operating profit are the following operating income (expense) items:
Depreciation (Note 8)
Employee benefits (Note 28)
Gain on settlement of financial liability
Gain on disposal of investments
Operating lease payments (Note 29)
Research and development
Repairs and maintenance
3,044 The effective rates of interest on debt servicing for the year are included in Note 18.
9,068
71
72
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
23. Other Income
Gain on disposal of property, plant and equipment
Loss on revaluation of land and buildings
Other income
2014 2013
$’000 $’000
250
(10,865)
234
(10,381)
1,781
-1,393
3,174
24. Dividend Income
Dividend income
2014 2013
$’000 $’000
1,245
126
25. Foreign Exchange Gains
2014 2013
$’000 $’000
Gain on settlement of Euro debt
Other foreign exchange (losses) gains
-
17,732
(1,180)
3,320
(1,180)
21,052
26. Taxation Expense
2014 2013
$’000 $’000
Current charge
Deferred tax expense (Note 19(ii))
(45,466)
(8,084)
(56,955)
(4,862)
Net expense
(53,550)
(61,817)
206,976
350,835
The tax on the Group’s profit before tax differs from that calculated at the statutory tax rate applicable to profits of the Group companies as follows:
Profit before tax
Tax charge at statutory rate of 25%
Non-deductible expenses
Income not subject to tax
Revenue based taxes – Green Fund levy
51,744
9,522
(8,897)
1,181
87,709
6,463
(33,519)
1,164
53,550 61,817
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
27. Earnings per Share
Basic earnings per share is calculated by dividing the net profit attributable to equity holders of the Group by the number of ordinary shares in issue during the year, excluding ordinary shares purchased by the Group and held as treasury shares.
2014 2013
Profit attributable to equity holders of the Company ($’000)
153,426
289,018
Number of ordinary shares in issue (000) (Note 16)
205,820
205,820
0.75
1.41
Basic and diluted earnings per share ($)
28. Employee Benefits
2014 2013
$’000 $’000
Wages, salaries and other benefits
Pension costs – defined benefit plans
100,505
1,728
98,801
1,673
102,233
100,474
29. Leases
The Group has non-cancellable operating leases for vehicles and office space.
2014 2013
$’000 $’000
Expense for the year
Future minimum lease payments under these leases at
December 31 are as follows:
Within 1 year
Between 2 and 5 years
3,544
3,426
2,711
2,377
3,235
3,399
5,088
6,634
73
74
Angostura Holdings Limited
• Annual Report 2014
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Notes to the Consolidated Financial Statements (continued)
30. Related Party Transactions
The following transactions were carried out with related parties during the year: 2014
2013
$’000 $’000
i) Sales of goods and services
Sales of goods:
- Equity-accounted investees
-
13,526
- Entities controlled by Parent
9,111
8,835
9,111
22,361
Interest, dividends and other income:
- Entities controlled by Parent
- Key management
9
13
119
56
22
175
9,133
22,536
174
348
ii) Purchases of goods and services
Purchases of goods:
- Entities controlled by Parent
Purchases of services and interest charges:
- Equity-accounted investees
- Entities controlled by Parent
-11,066
11,066
20,611
11,239
20,959
11,305
848
12,769
711
12,153
13,480
iii) Key management compensation
Salaries and other short-term employee benefits
Pension contributions iv) Year-end balances arising from sales/purchases of goods/services
Current receivables from related parties:
- Parent
- Provision for impairment of receivable
984,611
(984,611)
--
10,564
10,047
984,611
(984,611)
--
There were no movements in the provision related to the Group’s parent company receivable during the year.
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
Angostura Holdings Limited
• Annual Report 2014
75
Notes to the Consolidated Financial Statements (continued)
30. Related Party Transactions (continued)
2014
2013
$’000 $’000
v) Year-end balances arising from sales/purchases of goods/services
- Entities controlled by Parent
9,959
9,532
- Provision for impairment of receivables
(6,932)
(7,044) - Key management
3,027 2,488
220
315
3,247
2,803
Analysis of movements in related party impairment provisions:
Opening balance
Amounts written off against provision
Increase in provision
7,044
(112)
--
7,031
-13
Closing provision
6,932
7,044
vi) Payables and provisions in respect of related parties (Note 20)
- Parent
2,410
2,410
vii) Other charges due to related parties
- Entities controlled by Parent
- Key management
2,726
4,913
2,922
6,025
7,638
8,947
4,989
(4,989)
4,989
(4,989)
viii) Loans to related parties
- Equity-accounted investees
- Provision for impairment of receivables
--
--
31. Restatement – Prior Period Adjustment
Prior to 2014, the Group maintained a provision for aging losses to account for expected evaporation of spirits as part of the aging process. The provision was required since regular re-casking of aged spirits was not undertaken, and losses from evaporation were theoretically derived. During 2014, an extensive re-casking exercise commenced in which the Group was able to determine volume and value of aging losses of decanted spirits. Upon completion of the exercise, expected in 2015 and every five years thereafter, the full extent of aging losses will be confirmed for all aged stock.
The Group’s current accounting policy is to carry inventory at the lower of cost and net realisable value, where cost includes ‘expenditure incurred in acquiring the inventories, production or conversion costs, and other costs incurred in bringing them to their existing location and condition’. Aging losses are a cost to convert spirits from ‘fresh’ to ‘aged’ and as such, should be included within the cost of aged stock. The Group intends to regularly conduct re-casking exercises in the future, to ensure barrels are efficiently used for aging of spirits, and as a consequence, will regularly confirm the volume of evaporation from aging. Due to this change in operations, the Group has concluded that a provision for aging losses should no longer be carried. The resulting change in accounting policy has been recognised retrospectively in these consolidated financial statements in accordance with the provisions of IAS 8 (Accounting Policies, Change in Accounting Estimates and Errors).
76
Angostura Holdings Limited
December 31, 2014
(Expressed in Trinidad and Tobago Dollars)
• Annual Report 2014
Notes to the Consolidated Financial Statements (continued)
31. Restatement – Prior Period Adjustment (continued)
The quantitative impact of the change is set out below:
December 31, 2012
Impact of Re-statement
As
Change in
Previously Accounting
Reported
Policy
Retained
Earnings
As
Restated
$’000 $’000 $’000 $’000
Inventory value
Aging provision
Tax impact
204,358
(12,352)
--
192,006
December 31, 2013
Inventory value
Aging provision
Tax impact
198,631
(12,494)
--
186,137
-12,352
(3,088)
9,264
-12,494
(3,124)
9,370
-(12,352)
3,088
204,358
---
(9,264)
204,358
-(142)
36
198,631
---
(106)
198,631
32. Contingencies
The Group was party to certain legal issues at the reporting date for which provisions have been made in the consolidated financial statements. Management is satisfied that provisions held at the year-end in respect of legal matters were reasonable, and such amounts are reported within
‘Provisions’ in ‘Trade and Other Payables’ (Note 20) on the consolidated statement of financial position. 33. Capital Commitments
At the year-end, capital commitments amounted to $56,676 thousand (2013: $70,761 thousand). 34. Events after the Reporting Date
On March 23, 2015 the Board of Directors declared a final dividend in respect of 2014 of 16¢ per share. The total dividend declared in respect of 2014 was 26¢ (2013: 24¢) per share.
There were no events occurring after the reporting date and before the date of approval of the consolidated financial statements by the Board of Directors that require adjustment or disclosure in the consolidated financial statements.
Angostura Holdings Limited
• Annual Report 2014
Management Proxy Circular
Republic of Trinidad and Tobago
The Companies Act, 1995
(Section 144)
1.
Name of Company:
ANGOSTURA HOLDINGS LIMITED. Company No. A-719(C).
2.
Particulars of Meeting:
Thirty-third Annual Meeting of the Company to be held on July 27, 2015 at 10.00 a.m. at the
House of Angostura, Angostura Complex, Eastern Main Road, Laventille, Trinidad.
3.
Solicitation:
It is intended to vote the Proxy solicited hereby (unless the Shareholder directs otherwise) in favour of all resolutions specified therein.
4.
Any Director’s statement submitted pursuant to Section 76 (2):
No statement has been received from any Director pursuant to Section 76 (2) of the Companies
Act, 1995.
5.
Any Auditor’s statement submitted pursuant to Section 171 (1):
No statement has been received from the Auditors of the Company pursuant to Section 171
(1) of the Companies Act, 1995.
6.
Any Shareholder’s proposal submitted pursuant to Sections 116 (a) and 117 (2):
No statement has been received from Shareholder pursuant to Sections 116 (a) and 117 (2) of the Companies Act, 1995.
Date
June 30, 2015
Name and Title
Lyn Patricia Lopez
Secretary
Signature
77
Proxy Form
Angostura Holdings Limited
Company No.:A-719(C)
I/We the undersigned, being a shareholder (s) of Angostura Holdings Limited, hereby appoint
.................................................................. of ................................................................................
Or failing him/her, the Chairman of the meeting, as my proxy to vote for me and on my behalf at the Annual General Meeting of the Company, to be held on July, 27, 2015 at 10:00 am and any adjournment thereof.
Ordinary Business
Item
Resolution
Resolution 1
To receive, consider and approve the Report of the
Directors, the Audited Financial Statements of the
Company for the financial year ended December 31,
2014, together with the report of the Auditors thereon.
Resolution 2
To appoint KPMG as auditors of the Company for the financial year ending December 31, 2015 and to authorise the Directors to fix their remuneration thereon. Resolution 3
To re-elect the following directors who retire in accordance with paragraph 4.6.1 of Bye Law No. 1 of the Company (and being eligible offer themselves for re-election) until the close of the third Annual General
Meeting of the Company following his election or until his retirement:
Resolution 3(a)
Krishna Boodhai
Marlon Holder
Joseph Teixeira
For Against
Gerald Yetming
Signed this ................................................ day of ............................................................... 2015
Signed: ..................................................... Name: ........................................................................
Address:
