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INVESTMENT IN JOINT-VENTURE ENTITY

  The group’s principal investment is a 50% (2015: 50%) interest in Assmang Proprietary Limited (Assmang), a South African company which it jointly controls with African Rainbow Minerals (ARM) which is also listed on the JSE. Assmang mines iron, manganese and chrome ores and produces manganese and chrome alloys. In accordance with IFRS, the results of Assmang are accounted for by Assore using the equity method. The financial information set out below has been extracted from the audited financial statements of Assmang and its subsidiary companies for the year ended 30 June 2016.
       
    2016  2015*
    R’000  R’000 
  Consolidated income statement of Assmang (accounting for Dwarsrivier as a discontinued operation)    
  Turnover 18 927 093  19 512 919 
  Cost of sales (14 374 497) (14 369 081)
  Gross profit 4 552 596  5 143 838 
  Other operating income 796 369  656 844 
  Other operating expenses (2 185 862) (2 754 964)
  Profit from operations 3 163 103  3 045 718 
  (Loss)/income from joint-venture entity (17 741) 101 684 
  Income from investments 416 251  434 164 
  Finance costs (59 258) (55 157)
  Profit before taxation 3 502 355  3 526 409 
  Taxation (950 181) (988 902)
  Profit for the year from continuing operations, net of taxation 2 552 174  2 537 507 
  Discontinued operations    
  Profit after taxation for the year from discontinued operation (refer note 36) 103 183  121 716 
  Other comprehensive income 206 442  – 
  Total comprehensive income for the year, net of taxation (group interest therein 50% (2015: 50%)) (refer "Equity accounting results for Assmang"? below) 2 861 799  2 659 223 
  Dividends declared during the year 1 750 000  3 000 000 
  Abridged consolidated statement of financial position of Assmang    
  Total assets    
  Non-current assets 24 918 898  23 728 211 
  Current assets    
  Inventories 3 712 093  4 448 860 
  Trade and other receivables 3 557 556  3 532 558 
  Financial assets 71 450  85 017 
  Cash resources 4 798 476  4 942 638 
  Assets held-for-sale 1 843 269  1 585 709 
    38 901 742  38 322 993 
  Total liabilities    
  Non-current liabilities    
    Deferred taxation liability 5 097 914  5 035 202 
    Long-term provisions 802 695  959 828 
    Trade and other payables 96 381  92 344 
  Current liabilities    
    Trade and other payables 1 320 541  1 857 782 
    Short-term provisions 698 627  608 367 
    Taxation 213 125  369 778 
    Liabilities directly associated with the assets held-for-sale 630 964  469 996 
    8 860 247  9 393 297 
  Net assets 30 041 495  28 929 696 
  Proportion of the group’s ownership 50% 50%
  Carrying amount of investment    
  Opening balance 14 585 308  14 768 170 
  Share of profit after taxation 1 281 000  1 317 138 
  Share of other comprehensive income, net of taxation 103 221  – 
  Less: Dividends received (875 000) (1 500 000)
  Carrying amount of investment in statement of financial position 15 094 529  14 585 308 
 
* Certain comparative figures have been restated in accordance with the restatements adopted in Assmang’s financial statements for 2016, which were previously disclosed as follows (R’000):
  – other operating income 650 092   
  – other comprehensive income 6 752   
  non-current assets 23 725 390   
  – deferred taxation 2 821   
  – cash resources 5 425 101   
  – assets held-for-sale 1 103 246   
  – trade and other payables 1 950 126   
    2016  2015 
    R’000  R’000 
  Carrying amount of investment (continued)    
  Capital expenditure 2 974 678  3 836 808 
  Capital commitments 3 521 805  5 035 856 
  – contracted for 1 123 409  2 286 424 
  – not contracted for 2 398 396  2 749 432 
       
  Equity accounting results of Assmang    
  Total comprehensive income for the year, net of taxation 2 861 799  2 659 223 
  Less: Other comprehensive income from continuing and discontinued operations (206 442) – 
    2 655 357  2 659 223 
  Less: Depreciation not recorded in Assmang as assets held-for-sale (Dwarsrivier), effective 25 June 2015, required for group (68 410) – 
  Assmang profit after taxation accounting for Dwarsrivier as a continuing operation 2 586 947  2 659 223 
  50% thereon 1 293 474  1 329 612 
  Group consolidation adjustments (12 474) (12 474)
  Share of profit from joint-venture entity after taxation per income statement 1 281 000  1 317 138 
       
  Impairment of assets    
  The carrying values of the following assets were fully impaired at year-end, as no future economic benefits were expected to arise from these operations:    
  – furnaces and associated assets at Cato Ridge Works 333 110  302 956 
  – mine properties and associated assets at Machadodorp Works 72 308  – 
  – one ferromanganese furnace at Machadodorp Works and associated assets –  362 306 
  – the off-grade plant at Khumani Iron Ore Mine –  147 114 
    405 418  812 376