enl commercial limited annual report 2011 - Investing In Africa

ENL COMMERCIAL LIMITED 

ANNUAL REPORT 2011

100% 

This Annual Report is printed on 

ENL Commercial Limited 

7 th Floor Swan Group Centre | 10, Intendance Street 

Port Louis | Mauritius 

T +230 213 3800 | F +230 208 0968 

info@enl.mu | www.enl.mu 

Contents 

Group 

Structure 

Portfolio of 

Operating Companies 

Financial 

Highlights 

Director’s 

Report 

4 5 

6-7 10-28 29 

Corporate 

Information 

Corporate Governance 

Report 

Share 

Analysis 

ENL Foundation 

Statement of Directors’ 

Responsibilities 

Other Statutory 

Disclosures 

30-48 49 

50-55 56 57-60 

Company Secretary’s 

Certificate 

Independent Auditors’ 

Report to the Members 

Statements of Financial 

Position 

Statements of 

Comprehensive Income 

61 62-63 65 66-67 68 

Statement of Changes 

in Equity 

Statements 

of Cash Flows 

Notes to the Financial 

Statements 

Notice of 

Meeting 

Proxy 

Form 

69 70-111 112 113 

2 

The Savannah Sugar Estates Company Limited - Annual Report 2010

Dear Shareholder, 

The Board of Directors of ENL Commercial Limited is pleased to present the Annual Report of the Company 

and of the Group for the year ended June 30, 2011. This report was approved by the Board of Directors on 

September 30, 2011. 

On behalf of the Board of Directors, we invite you to join us at the Annual Meeting of the Company to be 

held: 

Date: December 7, 2011 

Time: 13.30 hours 

Place: 7th Floor, Swan Group Centre 

Intendance Street 

Port Louis 

Sincerely, 

Guy RIVALLAND 

Chairman 

Eric ESPITALIER-NOËL 

Director 


Annual Report 2011 

1

Eric Espitalier-Noël ( CEO of ENL Commercial ) 

2 


Annual Report 2011



3

Group Structure 

as at June 30, 2011 

Subsidiairies 

Associates 

Non-Core Assets 

Axess Limited 

(Car accessories & 

earthmoving equipment) 

100.00% 

35.00% 

Docufile (Mauritius) Ltd 

(Warehousing of documents) 

11.68% 

ENL Investment Limited 3 

(Investment holding) 

Charabia Ltd 

(Supplier to hospitality 

industry) 

100.00% 

25.00% 

ENl Foundation 

(Corporate Social 

Responsibility) 

1.38% O shares 

1.56% P shares 

ENL Land Ltd 3 

(Agribusiness & Property) 

COGIR Limitée 

(Building & Construction) 

56.00% 

47.14% 

Formation, Recruitemement 

et Conseil en Informatique 

(IT training & services) 

0.74% 

New Mauritius Hotels 3 

(Hotel owner & operator) 

Grewals (Mauritius) Limited 1 

(Supplier of timber and 

building materials) 

100.00% 

45.00% 

Hyperdist IO 

(Investment) 

2% O shares 

3.33% P shares 

Tropical Paradise 3 

(Hotel owner & operator) 

100.00% 

100.00% 

Grewals Contracting Ltd 

(Joinery contracting) 

Hyperdist Madagascar 

(Sale of IT products) 

25.00% 

Grewals Rodrigues Ltd 

(Timber merchant in Rodrigues) 

75.00% 

45.00% 

Superdist 

(IT Hardware) 

Pack Plastics Limited 

(Supplier to hospitality 

industry) 

99.93% 

Changes in Shareholding post June 30, 2011 

Packestate Limited 

(Rental of industrial buildings) 

Plastinax Austral Limitée 2 

(Eyewear manufacturer) 

Rennel Limited 

(International Express courier) 

100.00% 

58.81% 

100.00% 

Subsidiaries 

¹ Effective July 1, 2011, Grewals (Mauritius) has amalgamated with Grewals 

Contracting and Grewals (Mauritius) now remains as the amalgamated 

company 

² Post 30 June 2011, ENL Commercial will hold 92.38% in Plastinax Austral 

As at July 1, 2011, ENL Commercial holds 100% in L’Epongerie 

Non-Core Assets 

³ On October 10, 2011, ENL Commercial disposed of the following stakes: 

- 11.68% of ENL Investment 

- 1.38% and 1.56% of O and P shares of ENL Land Ltd respectively 

- 0.74% of New Mauritius Hotels 

- 2% and 3.33% of O and P shares of Tropical Paradise respectively 

Société Réunion 

(Investment holding) 

100.00% 

O Shares- Ordinary Shares 

P Shares - non voting convertible redeemable preference shares 

4 



Portfolio of operating companies 

of ENL Commercial 

as at June 30, 2011 

Rs M 

364 

20m 

Axess 

Charabia 

128 

30 

77 

Cogir 

FRCI 

Grewals 

75 

Pack Plastics 

31 

111 

Rennel 

33 

Others 

Superdist 



5

Financial Highlights 

Earnings per Share (Rs) 

14.07 

1.51 

1.05 0.91 

2.81 

2007 2008 2009 2010 2011 

Group Profit After Tax (Rs’000) 

Entity Dividends Receivable (Rs’000) 

416,593 

48,087 

50,493 

42,965 

49,426 

31,487 

85,072 

48,172 

30,659 

26,499 

2007 

2008 

2009 

2010 

2011 

2007 

2008 

2009 

2010 


6 



Dividend per Share (Rs) 

0.80 0.80 

0.90 

0.60 

0.30 

2007 2008 2009 2010 2011 

Group Turnover (Rs’000) 

Profit Before Exceptional Items (Rs’000) 

2,631,792 

91,739 

61,086 

53,083 

1,105,274 

1,262,597 

1,324,690 

1,345,657 

26,860 

34,701 

2007 

2008 

2009 

2010 


2007 

2008 

2009 

2010 




7

8 





9

Directors’ Report 

Part of the ENL group, ENL Commercial Limited was created in 1969 with a view to developing nonsugar 

activities within the ENL group. The Company is listed on the Stock Exchange of Mauritius Limited 

and is made up of a number of commercial, service and manufacturing business units. ENL Commercial 

has contracted out its management to ENL Limited and as such benefits from a pool of experienced 

professionals to support its strategic thinking and development. All of its business units are autonomously 

managed and adequately staffed but have to follow reporting guidelines and abide by set standards of 

business ethics. 

Financial Results 

The Group registered a marked increase in its turnover which reached Rs 2.6bn in 2011 as compared with 

Rs 1.3bn in 2010. This significant improvement is mainly attributable to the consolidation of the turnovers 

of Plastinax Austral and Cogir, in which ENL Commercial acquired a majority stake during the year under 

review. The Group’s profit before exceptional items which amounted to Rs 34.7m for 2010 reached 

Rs 53.1m for the year under review. This 55% increase is mainly due to better performances of its subsidiary 

companies. 

The Company has declared a dividend of Re 0.90 per share for the year under review. 

Segmental Review 

Commercial Segment 

Axess 

Grewals (Mauritius) 

Rennel 

Charabia 

During the year under review, the Group acquired Charabia, a company providing goods and services to 

the Hospitality Industry though the turnover was not consolidated as the acquisition was finalised in June 

2011. Turnover of the Commercial Segment was much better than last year; it increased from Rs 1,293m to 

Rs 1,524m while operating profits stood at Rs 79m (Rs 51m in 2010) on account of a more dynamic market. 

Industry Segment 

Pack Plastics 

Plastinax 

Cogir 

During the year under review, Emballages Limited was amalgamated with Pack Plastics Limited with the 

latter remaining as the amalgamated company. Moreover, ENL Commercial acquired a majority stake 

in former associated companies Plastinax Austral and Cogir. As a result, these two companies are now 

subsidiaries. 

Following the above mentioned acquisitions, segment turnover increased from Rs 53m in 2010 to 

Rs 1,108m in 2011, whilst operating profits increased substantially to reach Rs 49m in 2011 (Rs 3 m for 

2010). 

10 



Directors’ Report 

(continued) 

Associated Companies 

FRCI 

Superdist 

Docufile (Mauritius) 

During the course of the financial year, the Group acquired a 35% stake in Docufile, a company providing 

archiving services to local operators. 

The contribution of the associated companies to the results of the Group was impacted by the poor 

performance of Superdist for the 12 months ended June 30, 2011.The share of loss attributable to the 

associates was Rs 4m against a profit of Rs 5m in 2010. 

A review of each Subsidiary and Associated Company listed above is found on pages 12 to 28 of the Annual 

Report. 

Prospects 

The Group has completed its 3 year strategic planning exercise in June 2011. Its first milestone is the 

sale of the remaining non-core investments, as approved by shareholders at the special meeting held 

on 7 October 2011. This transaction, bringing in Rs 680m of cash, will enable the Company to repay its 

debts, to consolidate its subsidiary companies and to avail itself of new business opportunities. As a result, 

Group profits are expected to improve in 2012. Moreover, the Group believes that the drivers of the 3 year 

strategic plan, namely Focus, Cash Generation, Business Development, People and Culture, will translate 

into enhanced dynamism and performance and will benefit shareholders through increased profitablity. 

Acknowledgement 

Mr. Guy Rivalland is retiring from his office as Chairman of the Board of Directors of ENL Commercial 

Limited on the forthcoming annual meeting of shareholders. Since his appointment, in 1989, as Director 

and Chairman of the Company, Guy Rivalland has shown unflinching dedication to further the interests of 

ENL Group. His discrete wisdom backed by a solid reputation as one the country’s finest solicitors has 

earned him the respect and esteem of fellow directors who have always found in him a source of reliable 

guidance. The Board of Directors of ENL Commercial Limited thanks Guy Rivalland for his contribution and 

wishes him a fruitful and restful retirement. 

Guy RIVALLAND 

Chairman 


Director 



11

ACTIVITIES 

Axess is a major player in the motor vehicle industry in Mauritius with a market 

share of approximately 15%. The company is specialised in the sales of new 

vehicles and offers a complete after sales service with a comprehensive range 

of products and services to meet the needs and expectations of the local 

market. Axess is strategically located in Pailles, and provides a dedicated and 

highly qualified team to satisfy the needs of all its customers. 

Axess is the exclusive dealer of prestigious brands such as Jaguar, Land Rover, 

Ford, Citroën, Mazda, Isuzu, Suzuki as well as agricultural machinery, with the 

renowned New Holland brand. 

Axess is also the sole distributor of Michelin Tyres in Mauritius operating under 

Univers M which provides tyres for all types of vehicles and offers the following 

services: 

• Professional technical assistance 

• Free breakdown tyre assistance 

• Credit facilities on the spot on all services and products 

A new tool and accessory showroom has been set up as a one stop shop 

for brands such as Hitachi, Mirka, Sonic tools, Abel Auto, Varta and Freedom 

Batteries. 

MANAGEMENT TEAM 

Antoine d’Unienville - General Manager 

831 

47 

1,009 

60 

1,094 

50 

1,124 

52 

1,315 

79 

Olivier de Robillard - Sales & Marketing Manager 

Patrick Souchon - Finance & Administration Manager 

Guy Toulet - After Sales Operations Manager 

Sylvain Pipelier - Spare Parts Manager 

YEAR REVIEW 

The motor vehicle market picked-up at the beginning of 2010 and remained 

buoyant for the whole financial year. Sales volumes rose substantially to reach 

7,300 units, representing an increase of 22% from the previous financial year. 

The strong Yen has been unfavourable to imported second hand operators, 

allowing new vehicles dealerships to gain market share. Axess sold 1,051 

vehicles for the year under review, margins were maintained at satisfactory 

levels on sales and services, and expenses were kept under close control. 

Due to the above mentioned factors, the company posted better results than 

last year’s with operating profits of Rs 79m (2010: Rs 52m) and a net profit of 

Rs 38.9m (2010: Rs 34.4m). 

2007 

2008 

2009 

2010 


Turnover (Rs’000) 

Operating Profit (Rs’000) 

PROSPECTS 

Notwithstanding the persistent unpredictable economic climate both on the 

local and international scenes, the company’s sales and services for the current 

year have been forecasted on assumptions of a stable market and are expected 

to be Rs 1,5m. It is difficult at this stage to anticipate precisely the effects of the 

new duty formula based on Co2 emissions, but it is highly likely that sales of 

vehicles equipped with small capacity engines will be boosted to the detriment 

of more polluting bigger engines. However, Axess having a wide range of 

products on offer, one is expected to be counterbalanced by the other. 

Efforts have also been deployed in order to enhance customer satisfaction at 

after sales level; this should bear favourably on service figures. 

12 



AXESS LIMITED 



13

ACTIVITIES 

Charabia is specialised in the sale of premium quality fabrics imported 

from various suppliers in Europe, South Africa and the Far East at 

competitive prices. 

Every aspect of business bearing the Charabia label ensures originality 

and master quality. As an established and trustworthy name in both 

the hospitality and retail sectors, Charabia’s top priority is to provide 

excellence and quality in every project it tackles. 

The company’s contracting department is dedicated to provide 

professional attention to detail in all its undertakings, be it soft furnishing 

items (sofas, curtains, bedcovers, cushions etc), handmade lampshades, 

wallpapers or trimmings. 


Nathalie Hardy - Manager 

YEAR REVIEW 

The performance of Charabia was adversely affected by the negative 

impact which the persistent economic crisis has had on the tourism 

sector. 

36,301 

However the Management adopted a proactive approach to counter 

those difficulties by developing new services lines such as procurement 

services to RES projects. These new services have helped Charabia to 

increase its turnover by 68% to reach Rs 31.6m. Bottom line results 

were better than what had been anticipated, with a profit of Rs 1.6m. 

30,619 

31,635 

PROSPECTS 

18,599 

9,437 

19,184 

The Hospitality Industry is still suffering and this will affect the business 

progress of Charabia. However, with the support of ENL group, 

management is now in a better position to face the challenges ahead. 

5,834 

1,365 

347 

1,858 

2007 

2008 

2009 

2010 




14 



CHARABIA LTD 



15

ACTIVITIES 

Cogir is a grade A building and civil engineering contractor with an 

impressive track record, having been involved in the construction of 

many hotels, industrial buildings, schools and residential properties 

locally. 

In July 2010, ENL Commercial acquired additional shares in Cogir, 

increasing its shareholding to 56%. 


Benoit Hardy - Managing Director 

Jean Claude Giraud – Executive Director 

Bernard Rougier Lagane - Executive Director 

Rosida Beesoo - Accountant 

Denis Espitalier Noel , Ercole Concil, Fernando Gonzalez - Senior Site 

Managers / Contracts Managers 

Ian Baillee , Maurice Martin - Site Managers 

Amben Gooriah – Senior QS 

Claude Bissessur - Personal Manager 

Jean Francois de Rosnay - Plant Manager 

YEAR REVIEW 

830 

During the year under review, Cogir completed the Port Chambly Project, 

a 50 bedroom hotel at Tamarina, an industrial building at Flacq and has 

been in progress on the Bagatelle Mall, Hotel and Infrastructure projects. 

The company’s turnover reached Rs 830m while the profit before tax 

stood at Rs 14.2m. The net profit has been negatively impacted by 

aggressive pricing on Bagatelle and also by unanticipated delays 

encountered in respect of secured projects. 

324 

13 

532 

533 

30 30 

478 

23 

17 

PROSPECTS 

For the financial year 2011-2012, Cogir will complete running projects at 

Bagatelle Mall as well as the extension works at le Suffren Hotel. Cogir 

is also already engaged in the construction of offices for ENL together 

with a commercial centre at St Pierre and of breeder farms for Food 

and Allied at Bonne Veine. Given the contracts already secured and 

the existing pipeline, Cogir’s turnover for the year ending June 2012 is 

expected to be in line with last year’s while bottom line results should 

exceed those of 2011. 

2007 

2008 

2009 

2010 




16 



COGIR LIMITÉE 



17

ACTIVITIES 

Grewals is a major supplier of high quality timber in Mauritius. It is fully 

equipped for lumbering operations and runs a saw mill for the processing 

of local pine timber. It offers Tanalith E treatment for soft woods and kiln 

drying services and has specialised in the supply of shingles to roofing 

specialists. 

As the local agent for the Dyrup brand, Grewals also sells a wide variety 

of wood care products. 

In addition, Grewals represents the famous Betafence brand, a leader 

in high quality fencings, access control gates and detection systems. 

In May 2010, Grewals successfully launched an Iron Sheeting production 

unit and targeted sales volumes for the first year of operation were 

achieved. 


Denis Gallet - General Manager 

Thierry Duchenne - Sales & Marketing Manager 

Jean Francois Rougier Lagane - Production Manager 

Darrel Appou - Business Development Manager 

Thierry Gourrege - Unit Production Manager 

YEAR REVIEW 

154,324 

11,507 

140,730 

7,894 

125,296 

121,133 

166,150 

7,722 

While an overall growth of only 4.3% was recorded in the construction 

sector in calendar year 2010, the residential building sector showed 

resilience and grew by 13.7% (8.1% in 2009). Grewals successfully 

partnered on major ongoing projects, resulting in a growth of 39% in its 

consolidated turnover which, at 30 th June 2011, totalled Rs 182m. 

This performance is attributable to the following : 

• Positive contribution from the iron sheeting department on a full year 

basis 

• Excellent sales realised on the Betafence branded product range 

• Material increase in sales of services 

Gross profit margin rose as a result of a better product mix and contained 

cost of operations. Consolidated profit for the year under review was 

Rs 2.1m as compared with a loss of Rs 6.3m last year. 

2007 

1,663 

(3,407) 

2008 

2009 

2010 




PROSPECTS 

Grewals (Mauritius) has amalgamated with Grewals Contracting with 

effect as from 1st of July 2011, with Grewals (Mauritius) remaining the 

amalgamated company. 

The construction sector is expected to remain tough with a real estate 

environment still showing signs of slow down. Continuous rising costs 

of raw materials as well as unstable prevailing economic conditions do 

not stimulate the industry and remain a potential threat to its growth rate. 

In the light of the above, Grewals’ strategy will be to focus on providing 

better quality products and services to its customers. The following 

actions have already been initiated: 

• Acquisition of a new state-of-the-art Moulder/Planner equipment 

• Creation of a help desk 

• Introduction of fidelity cards 

Furthermore, management has identified potential new business lines 

for the coming year. 

18 



GREWALS (MAURITIUS) LIMITED 



19

ACTIVITIES 

Pack Plastics and Emballages have been 

amalgamated during the course of the 

financial year with Pack Plastics remaining 

the amalgamated company. 

A rebranding exercise was carried out, 

resulting in the launching of the Packlines 

and Elite Stationery brands. This generated 

enhanced team spirit and renewed 

dynamism within the entire spectrum of the 

sales and administrative teams. 

ELITE Stationery’s main product lines consist of filing products and 

envelopes. It regularly adapts its range of wares to meet the ever 

changing needs of customers. An experienced workforce and a 

constant improvement in customer service are the determining factors 

in the firm’s market penetration strategy in local and regional markets. 

PACKLINES sells a wide range of goods consisting of indoor and outdoor 

soft furnishings products. Packlines also carries a range of giveaways/ 

promotional products. 

Its indoor product range consists of tailor made curtains, bed skirts, 

cushions, bolsters, curtain accessories, and high end specific curtains 

bands. Packlines’ specialised team also offers on site fixing services. 

The outdoor product offering is now more extensive, with outdoor 

furniture being added to the product range of beach mattresses and 

outdoor cushions in order to offer the customer a complete product. 

27,320 

3,282 

2007 

56,937 

34,905 

28,008 

26,551 

5,785 

4,750 

1,123 

30 

2008 

2009 

2010 





Arnaud Boullé - General Manager 

Jérôme Ferrat - Marketing Manager 

Navin Appalasami - Operation & HR Manager 

Anil Sobnack - Administration & Finance Manager 

Ravin Lochunah – Procurement Manager 

Kamal Hurreebun – Factory Manager 

YEAR REVIEW 

Elite has faced several challenges this year, competition for market 

share was fierce and orders were obtained on the back of difficult 

negotiations and reduced margins. New entrants were observed in the 

envelopes segment, resulting in a loss of market share. On the other 

hand improvements in our product offering and better service levels 

boosted sales of files. 

The year under review yielded good results for the Packlines range. The 

team demonstrated good ability and market trends were well anticipated. 

The strong foothold on the outdoor range was maintained and inroads 

were made in our newly developed indoor range. 

Some success was also recorded regionally and contracts were obtained 

in the neighboring islands. 

PROSPECTS 

The company has streamlined its production processes for Elite, 

resulting in efficiency gains, which coupled with aggressive marketing 

has generated good sales. Large orders have consequently been 

secured for the coming year. This activity is thus expected to contribute 

positively to the bottom line results of the company. 

Packline’s performance will be under pressure for the coming year, as 

it relies heavily on the Hospitality Industry, which is expected to remain 

sluggish. 

The recently acquired business of L’Epongerie, a company engaged 

in the business of import, manufacture and sale of linen and related 

products, complements the offering to hospitality industry and should 

help in mitigating these adverse market conditions and maintain actual 

profit levels. 

20 



PACK PLASTICS LIMITED 



21

Statement of Directors’ Responsibilities 

for the year ended June 30, 2010 (continued) 

ACTIVITIES 

Rennel is the licensee of Federal Express Corporation in Mauritius 

since 1st August 1995. This license enables the company to offer its 

customers the world renowned FedEx service quality. FedEx is the 

world’s largest express transportation company, providing fast and 

reliable delivery to more than 220 countries, including every address 

in the United States. FedEx provides customs-cleared, door-to-door 

service to more international locations than its competitors. Rennel 

through its license with FedEx can tap on a structure comprising of 688 

aircrafts and a workforce of more than 142,000 employees worldwide 

delivering approximately 8.5 million packages. 


Michel Prefumo – General Manager 

Jonathan Leung Kai Sen – Finance & Administration Manager 

Jean Alain Marie-Louise – IT & Operations Manager 

Josian Gopal – Customs Clearance Manager 

YEAR REVIEW 

48,624 

3,406 

50,582 

4,414 

49,975 

43,247 

(1,531) (923) 

50,515 

2,945 

In the first half of the financial year, sales were down on the previous 

year. However on the back of a more dynamic market and enhanced 

product offering, the Company performed better during the second 

semester and thus posted a satisfactory year end result. The new and 

more flexible product offering was in line with targeted customer’s 

demand and led to new market penetration. In addition, investment in 

the latest FedEx IT facilities namely FedEx Ship Manager (FSM), a state 

of the art desktop shipping solution enabled our customers in Mauritius 

to automate and manage their entire shipping process, through timesaving 

features, enhanced conveniences and renowned Fedex reliability. 

For the year ended 30 June 2011, Rennel registered an increase in 

turnover of 13.2% and a profit after tax of Rs 2.4m. 

PROSPECTS 

For the next financial year, the dedicated Rennel team will stay focused 

on cost control and on service quality. Rennel will continue to strengthen 

its working relationship with its service providers in order to offer its 

customer base a wider range of sophisticated services with a view to 

boost sales figures and achieve better bottom line results. 

2007 

2008 

2009 

2010 




22 




for the year ended June 30, 2010 (continued) 

RENNEL LIMITED 



23

ACTIVITIES 

Established in 1976, Plastinax Austral manufactures plastic injected 

sunglasses and reading glasses for export markets, mainly to the USA 

and Europe. The company has a successful history supplying superior 

quality eyewear products to major players in the industry. 

Plastinax Austral works in close partnership with its customers to 

develop their collections by offering design services, visualisation 

through hand-made prototyping, fine-tuning through 3D drawings and 

computer generated physical prototypes prior to the manufacturing of 

moulds for production. Plastinax Austral has representatives based in 

the USA and Europe who are responsible for developing its markets and 

offering proximity assistance and service. 


Nicholas Park - General Manager 

Didier Lagane - Technical Manager 

Didier de Spéville - Marketing & Sales Manager 

Thierry Lagane - Production Manager 

Hubert Koenig - Supply Chain Manager 

Nicolas Angeline - Financial Manager 

YEAR REVIEW 

192,759 

160,852 

191,934 

173,312 

215,311 

7,970 

For the financial year ended June 30, 2011, Plastinax Austral exported 

more than one million units, an increase of 46% from the previous year, 

and generated a turnover of Rs 215.3m, representing an increase of 

25% from the previous year. The gross profit reached Rs 60.3m (+73%). 

Profit before finance charges amounted to Rs 11.4m, a satisfactory 

turnaround compared with previous years losses. Despite adverse 

macroeconomic conditions, with a continued slow worldwide demand, 

and a 14% appreciation of the Mauritian Rupee against the US Dollar 

for the period, the company has managed to increase its sales and 

revenues. This has been made possible through the securing of four 

large new clients, and the consolidation of the existing customer base. 

PROSPECTS 

(12,542) 

2007 

(23,285) 

2008 

3,902 (14,976) 

2009 

2010 


Plastinax Austral has secured two additional large accounts for exports 

starting this coming financial year. This breakthrough is expected to 

increase export volumes by approximately 20%. To ensure a good 

control of this expansion, the company has recruited key personnel 

in order to consolidate its management team with a head of finance, 

a head of quality control and an industrial engineer. Investments have 

been made in three new injection molding machines and one new highend 

lens-cutting machine, in order to enhance first-time quality, contain 

production costs and increase productivity. 



24 



PLASTINAX AUSTRAL LIMITÉE 



25

SUPERDIST LIMITED 

ACTIVITIES 

The company is the largest distributor of IT hardware 

and software in the region. Based in Mauritius with 

a local office in Madagascar, Superdist serves a 

distribution network of over 600 resellers within the 

region. The brands sold include: Hewlett Packard, 

Fujitsu-Siemens, Cisco, Linksys, D-Link, Oracle, 

Samsung and Toshiba. 

389,367 

4,988 

2007 

520,377 

29,981 

2008 

536,818 

34,203 

2009 


573,320 

14,361 

2010 


454,742 

2,616 



Julien Gufflet - General Manager 

Bhim Bissessur - Administration & Finance Manager 

Parveen Sheik Dawood - Support & Logistic 

Manager 

YEAR REVIEW 

For the year ended December 31, 2010, turnover 

decreased to Rs 454m representing a 20% drop on 

2009 (Rs 573m). 

The crisis in Madagascar coupled with a significant 

decline in business from our main retail customers in 

Mauritius impacted heavily the company’s turnover. 

Gross margin was also under pressure due to fierce 

competition. 

The profitability of the company has been 

consequently adversely affected with a loss of 

Rs 4.2m (2009: loss of Rs 0.7m) 

PROSPECTS 

Market conditions remain very challenging in 

Mauritius and even more so in Madagascar. 

Local companies remain prudent on IT expenditure 

and the retail market is expected to be relatively 

slack. 

The re-engineering exercise started in 2010 is not yet 

completed and stringent cost control measures are 

still a priority. 

Turnover for the first six months of 2011 was below 

expectations and stood at Rs 169m. Thanks to a 

more aggressive marketing strategy, the second 

semester sales should improve significantly. 

26 



ACTIVITIES 

FRCI specialises in information technology services, 

software, web development and training for 

enterprises. Created in 1989, FRCI is structured 

around five main areas of activities and expertise: 

Nuclei - Training centre 

Isys - Enterprise content management and IT 

infrastructure 

Insight - Business software solutions 

eServices - Web solutions 

Maurisoft - Multimedia solutions 

FRCI has strong partnerships with leading 

international organisations such as, Adobe, McAfee 

and SkillSoft. The company is also a Microsoft Gold 

Partner since 2007. After being recognised in 2008 

as Microsoft IOI 10-years Outstanding Partner, 

FRCI received two other international awards at 

the Microsoft Worldwide Partners conference in 

Washington last year. 


Managing Director - Pierre-Yves Harel 

Administration & Finance Manager - Janine Lau 

Manager - Isys - Clarel Constance 

Manager - Insight - Denis Lam 

Manager - eServices - Frederic de Comarmond 

Manager - Nuclei - Mary-Jane Perrault 

Manager - Maurisoft - Nicolas Lemaire 

YEAR REVIEW 

In December 2010 FRCI moved in its new offices at 

Phoenix. 

For the year under review, some FRCI divisions still 

remained under pressure, while others had been able 

to meet their targets. 

The group’s turnover increased by 13% and the 

operating profit grew by 25% to reach Rs 12.4 m. 

PROSPECTS 

In spite of the difficult economic context, FRCI’s 

management team remains confident in the 

company’s capacity to improve on 2011 results for 

the year 2012. 

52,120 

5,441 

2007 

72,361 

9,280 

2008 

88,824 

8,674 

2009 


107,934 

9,896 

2010 


121,979 

12,397 


FORMATION, RECRUTEMENT ET CONSEIL INFORMATIQUE LIMITÉE 



27

DOCUFILE (MAURITIUS) LIMITED 

ACTIVITIES 

Established in 2003, Docufile is specialised in 

Document Management Systems. Its core business 

is the storage and management of archives. It 

operates a 10,000 square metre warehouse at 

Pailles and uses the latest technologies and 

systems to provide safe management of confidential 

documents for its corporate customers. The 

company is the market leader since its inception 

and is expanding its customer base. 

4,282 

6,383 

8,114 

8,631 

9,467 


Sophie De Chalain Pelletier – Managing Director 

Richie Caroopen – Systems Administrator 

YEAR REVIEW 

ENL Commercial purchased 35% of the shares 

of Docufile during the financial year under review. 

Efforts have been mainly targeted at upgrading 

service levels. 

PROSPECTS 

For the coming financial year, the thrust will be 

directed towards capturing new markets and 

developing new IT related systems. 

1,581 

(693) 

687 

134 

455 

2007 

2008 

2009 

2010 




28 



Corporate Information 

June 30, 2011 

Registered Office 

7 th Floor, Swan Group Centre 


Port Louis 

Telephone: (230) 213 3800 

Fax: (230) 208 0968 

Email: info@enl.mu 

Secretary 

ENL Limited 



Port Louis 

Share Registry 

MCB Registry and Securities Ltd 

Raymond Lamusse Building 

9-11 Sir William Newton Street 

Port Louis 

Tel: (230) 202 5419 

Fax: (230) 208 1167 

Management 

ENL Limited 



Port Louis 

Auditors 

BDO & Co. 

Bankers 

Barclays Bank PLC 

The Mauritius Commercial Bank Ltd 

State Bank of Mauritius Ltd 

Afrasia Bank Limited 

Solicitors 

Etude de Commarmond Koenig 

Notaries 

Me Jean Pierre Montocchio 

Me Bernard d’Hotman de Villiers 

Subsidiaries 

Axess Limited 

General Manager: 

Antoine M. d’Unienville 

Grewals Lane, Les Pailles 

Telephone: (230) 206 4300 

Fax: (230) 286 5121 

Email: axess@axess.mu 

Charabia Ltd 

General Manager: Nathalie Hardy 

Robinson Road, Floreal 

Telephone: (230) 696 2772/4410 

Fax: (230) 696 4623 

Email: charabia@intnet.mu 

Cogir Limitée 

Chief Executive Officer: Benoit Hardy 

(effective July 1, 2011) 

General Managing Director: Jean-Claude 

Giraud (up to June 30, 2011) 

Grewals Lane, Pailles 

Telephone: (230) 286 5633 

Fax: (230) 286 6566 

Email: cogirltee@intnet.mu 


General Manager: Denis Gallet 


Telephone: (230) 286 6619 

Fax: (230) 286 8649 

Email: info@grewals.mu 

(effective July 01, 2011 Grewals 

(Mauritius) Limited has amalgamated with 

Grewals Contracting Ltd and Grewals 

(Mauritius) Limited now remains as the 

amalgamated company) 

Grewals (Mauritius) Limited 

General Manager: Denis Gallet 


Telephone: (230) 286 6619 

Fax: (230) 286 8649 

Email: info@grewals.mu 


Manager: Denis Gallet 

Camp du Roi, Rodrigues 

Telephone: (230) 831 0178 

Fax: (230) 831 0177 


General Manager: Arnaud Boullé 

Anse Courtois, Les Pailles 

Telephone: (230) 286 2826 

Fax: (230) 286 6584 

Email: info@pack.mu 


General Manager: Arnaud Boullé 

Anse Courtois, Les Pailles 

Telephone: (230) 286 2826 

Fax: (230) 286 6584 

Email: info@pack.mu 

Plastinax Austral Limitée 

General Manager: Nicholas Park 

Industrial Zone, Saint Pierre 

Telephone: (230) 433 4638 

Fax: (230) 433 4639 

Email: plastinax@plastinax.com 


General Manager: Michel Prefumo 


Telephone: (230) 286 5914 

Fax: (230) 286 4948 

Email: info@rennel.mu 

Société Réunion 

Management: ENL Limited 


Intendance Street, Port Louis 

Telephone: (230) 213 3800 

Fax: (230) 208 0968 

Email: info@enl.mu 

Associates 

Docufile (Mauritius) Ltd 

General Manager: Sophie de Chalain- 

Pelletier 

Sir James Burty David Street 

Pailles 

Telephone: (230) 286 0627 / 

(230) 286 0195 

Email: customercare@docufile-mauritius. 

com 

Formation Recrutement et Conseil 

Informatique Limitée 

Managing Director: Pierre Yves Harel 

1 st Floor, The Hub 

Industrial Zone, Phoenix 

Telephone: (230) 286 9636 

Fax: (230) 286 9629 

Email: info@frci.net 

Hiperdist IO 

Managing Director: Julien Gufflet 

Anse Courtois, Pailles 

Telephone: (230) 286 9000 

Fax: (230) 286 9005/6 

Email: superdist@hiperdist.com 

Superdist Limited 

Managing Director: Julien Gufflet 

Anse Courtois, Pailles 

Telephone: (230) 286 9000 

Fax: (230) 286 9005/6 

Email: superdist@hiperdist.com 


Manager: Mario Radegonde 

Railway Square 

Minissy, Moka 

Telephone: (230) 4334231 

Fax: (230) 4339261 

Email: csroffice@enl.mu 



29

Corporate Governance Report 

The Directors have pleasure in submitting to shareholders their report on corporate governance. 

ENL Commercial Limited is committed to the highest standard of business integrity, transparency and 

professionalism on all its activities to ensure that the activities within the Company and the Group are 

managed ethically and responsibly to enhance business value for all stakeholders. ENL Commercial Limited 

is fully committed to the best principles of corporate governance. This report describes the main corporate 

governance framework and compliance of the Company with the disclosures required under the Code of 

Corporate Governance for Mauritius. 

Holding Structure 

ENL Commercial Limited forms part of the ENL group and the cascade holding structure through which 

control of the Company is exercised has remained unchanged since the previous financial year, save for 

some minor changes in the number of shares owned by various companies of the Group. 

The ultimate holding company of ENL Commercial Limited remains L’Accord Limited, a limited-liability 

public company incorporated in Mauritius. 

The ultimate control of the Company remains with Société Carédas, a société civile. 

The Company’s holding structure as at June 30, 2011 was as follows: 

(The % disclosed relates to voting rights) 

Société Carédas 

59.61% 

L’Accord Limited 

76.52% 

La Sablonnière Limited 

71.83% 

ENL Limited & its Subsidiaries 

61.12% 


30 


ANNUAL REPORT 2011


(continued) 

Common Directors 

Five Directors of the Company for the year ended June 30, 2011 were also directors of other companies 

within the Company’s holding structure, namely: 

L’Accord Limited La Sablonnière Limited ENL Limited 

Edouard Espitalier-Noël 

Eric Espitalier-Noël • • • 

Gilbert Espitalier-Noël 

Hector Espitalier-Noël • • • 

Gérard Garrioch 

Guy Rivalland 

Louis Rivalland 

Furthermore, the directorships held by the Company’s Directors in subsidiaries of the Company for the year 

ended June 30, 2011 were as follows: 

• 

• 

• 

Axess Limited 

Charabia Ltd 


Grewals Contracting Ltd* 







Edouard Espitalier-Noël 

Eric Espitalier-Noël • • • • • • • • • • 

Gilbert Espitalier-Noël 

Hector Espitalier-Noël • • • • • • • • 

Gérard Garrioch 

Guy Rivalland 

Louis Rivalland 

*(effective July 01, 2011 Grewals (Mauritius) Limited has amalgamated with Grewals Contracting Ltd and 

Grewals (Mauritius) Limited now remains as the amalgamated company) 

Substantial Shareholders 

As at June 30, 2011, the shareholders holding more than 5% of the ordinary shares of the Company were 

as follows: 

Ordinary % 

ENL Limited 46.34 

ENL Investment Limited 14.77 



31


(continued) 

Dividend Policy 

ENL Commercial Limited declares dividends in November (interim) and June (final) for every financial year. 

The Company has no formal dividend policy. Payment of dividends is subject to the profitability of the 

Company, cash flow, working capital and capital-expenditure requirements. 

The following table outlines the interim and final dividends paid by the Company over the last five financial 

years: 

Dividend per Share 

Total Dividend Value 

Financial year Interim (Rs) Final (Rs) Total (Rs) (Rs) 

June 30, 2007 0.20 0.10 0.30 8,751,750 

June 30, 2008 0.30 0.30 0.60 17,503,500 

June 30, 2009 0.50 0.30 0.80 23,338,000 

June 30, 2010 0.40 0.40 0.80 23,338,000 

June 30, 2011 0.40 0.50 0.90 26,255,250 

Directors’ Profile 

The names and profiles of the Company’s Directors are as follows: 

Edouard Espitalier-Noël (52 years) 

Non-Executive Director, Member of the Corporate Governance Committee 

Edouard Espitalier-Noël holds a BSc (Hons) degree from the UK in Electrical & Electronic Engineering. 

During his career, he has held various executive positions in the Rogers Group and has now retired after 

some 30 years of service. He was first appointed to the Board of the Company in 1989. 

Directorships in other listed companies 

• ENL Limited 

Eric Espitalier-Noël (52 years) 

Executive Director 

Eric Espitalier-Noël holds a Bachelor’s degree in Social Science and an MBA. 

He was first appointed to the Board of the Company in 1987 and is currently the Chief Executive Officer of 

ENL Commercial Limited. 


• Automatic Systems Limited 

• ENL Investment Limited 

• ENL Land Ltd 


• Les Moulins de la Concorde Ltée 

• Livestock Feed Limited 

• Rogers & Co. Ltd 

• Swan Insurance Co Ltd 

• The Anglo-Mauritius Assurance Society Ltd 

• Tropical Paradise Co Ltd (Alternate Director) 

32 




(continued) 

Gilbert Espitalier-Noël (47 years) 

Non-Executive Director, Member of Audit and Risk Management Committee 

Gilbert Espitalier-Noël holds a BSc (Hons) degree in Food Science and Engineering, a BSc in Biochemistry, 

Microbiology and Biotechnology, and an MBA from INSEAD. 

He was first appointed to the Company’s Board of Directors in 1999 and is currently the Chief Executive 

Officer of ENL Property Limited. 





• Livestock Feed Limited 

• Rogers & Co Ltd 

• Tropical Paradise Co Ltd 

Hector Espitalier-Noël (53 years) 

Executive Director, Member of the Corporate Governance Committee 

Hector Espitalier-Noël is a member of the Institute of Chartered Accountants in England and Wales. 

He was first appointed to the Board of the Company in 1984 and was appointed Chief Executive Officer of 

ENL Limited and the ENL Group in 1990. 





• New Mauritius Hotels Limited 

• Rogers & Co Ltd 

• Tropical Paradise Co Ltd 

Gérard Garrioch (56 years) 

Independent Non-Executive Director, Chairman of the Corporate Governance Committee, Member of the 

Audit and Risk Management Committee 

Gérard Garrioch holds a BSc (Hons) degree in Bio-chemistry and an MBA, and is the Executive Director of 

the Cernol group of companies. He was first appointed to the Board of the Company in 2004. 


• Southern Cross Tourist Company Ltd 

• Union Sugar Estate 

Guy Rivalland (67 years) 

Non-Executive Director, Chairman 

Guy Rivalland is a Senior attorney and has been practicing since 1966. He was first appointed to the Board 

of the Company in 1989. 







33


(continued) 

Directors’ Profile (continued) 

Louis Rivalland (40 years) 

Independent Non-Executive Director, Chairman of Audit and Risk Management Committee 

Louis Rivalland holds a BSc (Hons) degree in Actuarial Science and Statistics, and is a Fellow of the 

Institute of Actuaries (FIA) of the United Kingdom. 

He is the Group Chief Executive of Swan Insurance Co. Ltd and The Anglo-Mauritius Assurance Society 

Ltd. He was first appointed to the Company’s Board in 2004. 


• Belle Mare Holding Ltd 

• Ireland Blyth Limited 

• New Mauritius Hotels Limited 

• Swan Insurance Co. Ltd 

• The Mauritius Development Investment Trust Company Limited 

Directors’ Interests in the Shares of the Company 

The Directors’ interests in the shares of the Company as at June 30, 2011 were as follows: 

Direct 

No. of Ordinary 

Shares 

Indirect 

% 

No. of Ordinary 

Shares 

% 

Edouard Espitalier-Noël 6,387 0.022 56,594 0.194 

Eric Espitalier-Noël 259,728 0.890 1,425,368 4.886 

Gilbert Espitalier-Noël - - 1,459,208 5.002 

Hector Espitalier-Noël 648,737 2.224 1,439,371 4.934 

Gérard Garrioch - - - - 

Guy Rivalland - - - - 

Louis Rivalland - - - - 

Related Party Transactions 

Note 32 of the financial statements for the year ended June 30, 2011 set out on page 106 to 107 of the 

Annual Report 2011 details all the related party transactions between the Company or any of its subsidiaries 

or associates and a director, chief executive, controlling shareholder or companies owned or controlled by 

a director, chief executive or controlling shareholder. In addition, shareholders are apprised of related party 

transactions through the issue of circulars and press releases by the Company in compliance with the 

Listing Rules of the Stock Exchange of Mauritius Limited. 

Dealings in Shares by Directors 

The Board abides to the principles of the Model Code for Securities Transactions by Directors of Listed 

Companies as detailed in Appendix 6 of the Listing Rules issued by the Stock Exchange of Mauritius 

Limited. In this regard, Directors are kept apprised of closed periods and of their responsibilities in respect 

to the above Code. 

During the financial year under review, none of the Directors, except for Hector Espitalier-Noël who bought 

41,900 shares, have traded in ENL Commercial’s shares. 

34 




(continued) 

Material Clauses of the Company’s Constitution 

In 2007, the shareholders adopted a new Constitution, in compliance with the provisions of The Companies 

Act 2001 and the Listing Rules of the Stock Exchange of Mauritius Limited. 

The salient features of ENL Commercial’s constitution are as follows: 

• Fully paid up shares are freely transferable; 

• The Company may acquire and hold its own shares; 

• A special meeting of shareholders may be called by the Board and shall be so called on the written 

request of shareholders holding shares carrying together not less than five percent (5%) of the voting 

rights entitled to be exercised on the issue; 

• Proceedings of shareholder’s meeting are governed by the fifth schedule of the Companies Act 2001; 

• A director is not required to hold shares in the Company; 

• A quorum for a meeting of the Board is three directors. 

Shareholders’ Agreement affecting the Governance of the Company by the Board 

The Directors confirm that, to the best of their knowledge, they are not aware of the existence of any such 

agreement during the year under review. 

Contracts of Significance between the Company and its Substantial Shareholders 

The Company has renewed its contractual agreement with ENL Limited, its holding company, for the 

provision of management and secretarial services. The new contract provides for ENL Limited to be 

remunerated at a flat rate of Rs 5,000,000 (exclusive of Value Added Tax) per year. 

Furthermore, the Company’s operating subsidiaries also have a management contract with ENL Limited 

for the provision of management and secretarial services. The remuneration of ENL Limited in these cases 

consists of a fixed fee as well as an incentive fee of 5% of the respective subsidiary’s profit after tax, 

exclusive of value added tax. 

Profile of the Senior Management Team 

The profile of the Senior Management Team of ENL Commercial is as follows: 

Eric Espitalier-Noël 

Chief Executive Officer- ENL Commercial Limited 

(Please refer to Directors’ profile section) 

Olivier Lagesse 

Chief Operating Officer - ENL Commercial Limited 

Degree in IT & Social Sciences - Montpellier University - France 

Previous experience with TSI - Portfolio Investment Managers 

Joined ENL in 1996 



35


(continued) 

Management of Subsidiaries 

Arnaud Boullé 

General Manager - Pack Plastics Limited 

PHD - Management - Paris - France 

Previous experience with Aquarelle Clothing 

Joined Pack Plastics in 2008 

Antoine d’Unienville 

General Manager - Axess Limited 

Licence in Economy - UCT, RSA 

Sciences Po - Paris 

Joined Axess in 1989 

Denis Gallet 

General Manager - Grewals (Mauritius) Limited 

BCOM - University of Natal - Durban - South Africa 

Previous experience with Associated Brokers, Cirné Group 

Joined Grewals in 2002 

Jean-Claude Giraud 

General Managing Director - Cogir Limitée - (up to June 30, 2011) 

Degree in Structural Engineering (1971) 

Practice at Davis, Michelow & Harwood (S.A) 

Previous experience: SIGMA 

Benoit Hardy 

Chief Executive Officer – Cogir Limitée (effective 1 July 2011) 

BSc (Hons) Civil Engineering 

Previous experience with Flagstone Ltd 

First Joined Cogir in August 1998 till January 2007. Rejoined Cogir in May 2010 

Nathalie Hardy 

Manager – Charabia Ltd 

National Diploma in Textile Technology - Technikon Natal – South Africa 

Previous experience: 15 years in the textile industry 

Joined Charabia in May 2003 

Nicholas Park 

General Manager -Plastinax Austral Limitée 

DESS in International Commerce - IAE Lyon - France 

Previous experience with Rogers Logistics 

Joined Plastinax in 2008 

36 




(continued) 

Michel Prefumo 

General Manager - Rennel Limited (FedEx) 

MBA - University of Cape Town. Postgraduate Diploma in Marketing - The Chartered Institute of 

Marketing, UK. 

Previous experience with DCDM Business School and Mauritius Telecom 

Joined Rennel in 2005. 

Management of Associated Companies 

Sophie de Chalain-Pelletier 

Managing Director -Docufile (Mauritius) Ltd 

Previous experience as Director of Nonstop Ltd (Debt Management) 

Joined Docufile in June 2003 

Subudh Caussy 

General Manager – Superdist – (up to April 30, 2011) 

DEA in Information Technologies – France 

Julien Gufflet 

General Manager –Superdist (effective May 1, 2011) 

Chief Financial Officer –Superdist (up to April 30, 2011) 

Diplome d’Etude Supérieure Specialisée (DESS) en Ingenierie Financière (France), Maitrise d’Economie 

Appliquée (France), (Bsc) in Mathematics & Management (UK) 

Joined Superdist Limited in December 2010 

Pierre-Yves Harel 

Managing Director - FRCI Limitée 

DUT in management and administration, DECS Accounting - Aix en Provence - France 

Previous experience : GIS - Albatross - Rogers 

Joined FRCI in 1993 

Board of Directors 

The Board of Directors is the Company’s supreme governing body and has full power over the affairs of 

the Company. 

In accordance with the terms of the Company’s management contract, the Board has delegated to ENL 

Limited certain of its attributions, mainly with regard to day-to-day operational matters, but all major decisions 

have to be submitted to it by ENL Limited for approval. Furthermore, the Board remains accountable for 

such delegation. 

ENL Commercial is governed by a Board of Directors consisting of seven Directors. As per the Company’s 

constitution, the Board shall consist of not less than five nor more than seven Directors. At each Annual 

Meeting of the Company, one Director, who has been longest in office since his appointment or last reappointment, 

retires by rotation and is eligible for re-appointment. 



37


(continued) 

Board Charter 

The Board is of the view that the responsibilities of the Directors should not be confined in a Board charter 

and has consequently resolved not to adopt a charter. 

Remuneration of Directors 

The Company’s constitution confers upon the Board the power to fix directors’ emoluments. The table 

hereunder lays out the present remuneration policy, as decided by the Board, for the chairpersons and 

members of the Board and of its Committees. Each director’s yearly entitlement consists of two halves: one 

fixed (paid irrespective of attendance) and the other linked to attendance. 

The underlying philosophy is to set remuneration at appropriate level to attract, retain and motivate high 

calibre personnel and reward in alignment with their individual as well as joint contribution towards the 

achievement of the company’s objective and performance, whilst taking into account the current market 

conditions and Company’s financial position. The Directors are remunerated for their knowledge, experience 

and insight given to the Board and Committees. There is currently also no remuneration policy in place for 

executive directors approaching retirement. Such policy is determined on a case by case basis. 

Category of Member 

Yearly Fixed Fee 

(Rs) 

Yearly Attendance Fee 

(Rs) 

Company Chairman 90,000 90,000 

Board member 45,000 45,000 

Committee Chairman 60,000 60,000 

Committee member 30,000 30,000 

For the year under review, the actual remuneration and benefits perceived by the Directors are disclosed 

on pages 58 to 59 of the Annual Report. The said remuneration has been disclosed globally due to the 

commercial sensitivity of such information. 

Board Attendance 

For the year under review, the Board had six sittings and attendance by the Directors was as follows: 

16/09/10 11/11/10 24/11/10 11/02/11 12/05/11 23/06/11 

Edouard Espitalier-Noël • • • • • 

Eric Espitalier-Noël • • • • • 

Gilbert Espitalier-Noël • • • • • 

Hector Espitalier-Noël • • • • • • 

Gérard Garrioch • • • • 

Guy Rivalland • • • • • 

Louis Rivalland • • • • • • 

Corporate Governance Committee 

The Corporate Governance Committee consists of three members and met three times in the year under 

review. The Committee is chaired by an independent Director, in compliance with the code of corporate 

governance. 

38 




(continued) 

Attendance of members at the Committee’s meetings was as follows: 

13/09/10 15/03/11 10/06/11 

Edouard Espitalier-Noël • • • 

Hector Espitalier-Noël • • 

Gérard Garrioch (Chairman) • • • 

The main attributions of the Committee are as follows: 

Duties 

• Ensure that corporate governance reporting requirements are met. 

• Ensure that the company complies with all regulations pertaining to corporate governance. 

• Ascertain that potential new Directors are fit and proper and are not disqualified from being Directors. 

• Ensure that new Director is fully cognizant of what is expected from a Director. 

• Ensure that the right balance of skills, expertise and independence is maintained. 

• Pay particular attention to potential conflicts of interest and other ethical problems that could arise in 

nominating a Director. 

• Review the independence of the independent members of the Board. 

• Determine, develop and agree on the Company’s general policy with respect to executive and senior 

management remuneration. 

Reporting Responsibilities 

• Report formally to the Board on its proceedings after each meeting on all matters within its duties and 

responsibilities. 

• Make recommendations to the Board on any area within its remit where action or improvement is 

needed. 

The Committee also benefits, at its own instigation, from the collaboration of the internal audit department, 

which ensures during its routine audits that all corporate-governance initiatives as proposed by the 

committee are properly implemented in the Company’s subsidiaries. 

The Corporate Governance Committee has also requested the internal audit department to assess the 

compliance of each of the Company’s subsidiaries with the principles of good corporate governance. The 

reporting process that has been initiated is being closely monitored in the areas of Board issues, business 

ethics, human resources, environment and financial reporting. A follow up report is also made by the Group 

Chief Internal Auditor at least once a year. 

Audit and Risk Management Committee 

Established in the 2004-05 financial year, the Audit and Risk Management Committee is the cornerstone of 

the Company’s system of internal controls and risk management. 

The Board has delegated its powers on internal control and risk management to the Audit and Risk 

Management Committee which reviews the risk philosophy, strategy and policies of the Group. The Board 

strongly believes that internal control and risk management to be of paramount importance so that the 

activities of the Group are conducted in a suitable and stable environment conducive to growth. 

The committee consists of three members and met four times in the year under review. It is chaired by an 

independent Director in compliance with the Code of Corporate Governance of Mauritius. 



39


(continued) 

Audit and Risk Management Committee (continued) 

Attendance of members at the committee’s meetings was as follows: 

13/09/10 10/11/10 10/02/11 11/05/11 

Gilbert Espitalier-Noël • • • • 

Gérard Garrioch • • • • 

Louis Rivalland (Chairman) • • • • 

The Board of Directors of the Company had, on 12 May 2011, approved a new Terms of Reference for the 

Audit and Risk Management Committee of the Company. 

The main duties of the Audit and Risk Management Committee are as follows: 

I. Auditors and external audit 

• Consider and make recommendations to the Board for the appointment, re-appointment and removal 

of the company’s external auditor; 

• Evaluate the independence and effectiveness of the external auditor; 

• Discuss and review, with the external auditor the engagement letter, audit plan, terms, nature and 

scope of the audit function, procedure and engagement and audit fee; 

• Determine the remuneration of the external auditor, whether fees for audit or non-audit services, and 

the auditor’s terms of engagement; 

• Obtain assurance from the external auditor that adequate accounting records are being maintained; 

• Seek to ensure co-ordination with the activities of internal audit; 

• Meet privately with the external auditors at least once a year without the presence of senior 

management. 

II. Financial Reporting 

• Review significant accounting and reporting issues and understand their impact on the financial 

statements; 

• Review the annual financial statements, prior to submission and approval by the Board and assess 

whether the financial statements reflect appropriate accounting principles; 

• Ensure that International Accounting Standards have been consistently applied; 

• Meet with management and the external auditors to review the financial statements and the results of 

the audit; 

III. Internal control and internal audit 

• Review the internal audit function’s compliance with its mandate as approved by the Audit and Risk 

Management Committee; 

• Review the effectiveness of the Company’s systems of internal control, including internal financial 

control and business risk management and maintaining effective internal control systems; 

• Review and approve the internal audit charter, internal audit plans and internal audit’s conclusions with 

regard to internal control and risk management; 

• Review the adequacy of corrective action taken in response to significant internal audit findings; 

• Review significant matters reported by the internal audit function; 

40 




(continued) 

• Assess the adequacy of performance of the internal audit function, and ensure it has adequate 

resources and appropriate access to information to enable it to perform its function effectively and in 

accordance with the relevant professional standards; 

• Review significant differences of opinion between management and the internal audit function; 

• Evaluate the independence and effectiveness of the internal auditors; 

• Control the overall operational and financial reporting environment; 

• Meet the head of internal audit at least once a year, without management being present, to discuss 

their remit and any issues arising from the internal audits carried out. 

IV. Compliance, whistleblowing and fraud 

• Review the Company’s procedures for detecting fraud; 

• Review the Company’s systems and controls for the prevention of bribery and receive reports on noncompliance. 

V. Ethics 

• Review statements on ethical standards or requirements for the Company and assisting in developing 

such standards and requirements; 

• Give recommendations on any potential conflict of interest or questionable situations of a material 

nature. 

VI. Health, Safety and Environment 

• Review the development and implementation of health, safety and environmental practices to comply 

with existing legislative and regulatory frameworks. 

VII. Risk Management 

• Review and assess the integrity of the risk control systems and ensure that the risk policies and 

strategies are effectively managed; 

• Outline the scope of risk management work; 

• Review executive management reports detailing the adequacy and overall effectiveness of the 

Company’s risk management function and its implementation by management; 

• Review risk identification and measurement methodologies. 

VIII. Reporting And Accountability 

• To account to the Board for its activities and make recommendations concerning the adoption of the 

annual and interim financial statements and any area within its remit where action or improvement is 

needed; 

During its meetings in the financial year ended June 30, 2011, the Audit and Risk Management Committee’s 

work amongst others, mainly related to the following issues: 

(a) Review and recommend to the Board the approval of the audited financial statements for the year 

ended June 30, 2010; 

(b) Review and recommend to the Board the approval of the unaudited quarterly consolidated results of 

the Company for publication purposes; 

(c) Review and recommend the approval of the Internal Audit Plan for year ending June 30, 2012; 

(d) Examination of reports and corrective action plans relating to subsidiaries, in accordance with the 

internal audit plan; 

(e) Review of the effectiveness of the internal control and risk management systems. 



41


(continued) 

Internal Audit 

ENL Limited (ENL) provides internal audit services to the Company and to its subsidiaries in accordance with 

the terms of the management contract that binds the entities. ENL’s internal audit department is adequately 

staffed with qualified auditors and also conducts regular audits at the company’s subsidiaries. ENL’s chief 

internal auditor reports to the Company’s Audit and Risk Management Committee on all internal audit 

issues of the Company and of the Group. The internal audit department uses a risk-based methodology for 

auditing whereby compliance on policies and procedures is reviewed in areas of significant inherent risk. 

It also has unrestricted access to review all activities and transactions undertaken within the Group and to 

appraise and report thereon if necessary. 

The internal audit department provides independent assurance to the Audit and Risk Management 

Committee as to the adequacy and effectiveness of internal control and risk management processes. It 

operates in line with the Internal Audit Charter and has the objective of: 

(i) providing high quality and concise information in its reports; 

(ii) providing value added to the Group throughout all the assignment carried out; and 

(iii) using the latest audit techniques and business risk methodologies to perform its work effectively. 

Internal audit activities are carried out in line with an approved audit plan. A follow-up mechanism facilitates 

the monitoring of progress and the audit management system is continuously updated to international 

standards. 

The internal audit department works closely with the external auditors to further ensure the highest level of 

service to the Group. 

Furthermore, the Audit and Risk Management Committee meets specifically to review and approve the 

internal audit plan prior to the start of each financial year. 

ENL’s Chief Internal Auditor is invited to all meetings of the Audit and Risk Management Committee and is 

entitled to convene a special meeting of the committee in order to deal with any matter which he considers 

to be urgent. 

During the year ended June 30, 2011, the main tasks carried out by the internal audit department for the 

ENL Commercial group are as follows: 

• Conducting of Internal Audit reviews as per the Internal Audit Plan; 

• Finalising of action plans and corrective action plans with management; 

• Reporting on audit issues and progress reports of subsidiaries to the Audit and Risk Management 

Committee; 

• Collaborating with External Auditors and sharing of audit issues; 

• Attending to special reviews and assignments made at the request of management and the Audit and 

Risk Management Committee, as and when required; 

• Preparing of the Internal Audit Plan for year ended June 30, 2012 for approval by the Audit and Risk 

Management Committee; and 

• Facilitating the implementation of a Risk Management Register. 

Internal Control 

The Board is responsible for the system of internal control and risk management of the Company and its 

subsidiaries. The Board is committed to continuously maintain adequate internal control procedures with 

a view to safeguard the assets of the Group. Areas with high residual risks are continuously assessed and 

reviewed with the assistance of the internal audit department. 

42 




(continued) 

Risk Management 

Risk Management refers to the systematic and ongoing process used to identify, assess, prioritise and 

manage risks to mitigate the exposure to business risks. 

The Audit and Risk Management Committee monitors the risk-management process with the support 

of ENL’s Internal Audit Department. However, the Board of Directors has overall responsibility for the 

Company’s systems of risk management. Furthermore it ensures that this process is carried out by the 

Group in order to attain its strategic objectives. 

Management is accountable to the Board to establish processes and procedures for a logical and systematic 

method of identifying, analysing, treating and monitoring the significant risks involved in the activities of 

the Group. To this end, an in-house risk management framework based on proven and leading practices 

is relied upon by Management for identification of the risks inherent to the Company and capture them 

in a Risk Management Register. The Risk Management Register is aligned with the strategic objectives, 

enterprise culture and policies and procedures in place in the business. 

Given the dynamic nature of risks, Management is also responsible to continuously review and update 

the Risk Management Register to reflect the ongoing risk facing the business in order to ensure a robust 

system of risk management. Emerging risks recognition and the corresponding likelihood of occurrence as 

well as their potential impact are identified and assessed in a timely manner as a sequel of which adequate 

mitigating measures are implemented. Management also reports the most significant risks to the Board to 

assist the Board in the setting of the appropriate risk mitigating strategy. 

The Risk Management Register compiles, amongst others, the following information: 

(i) Identification of inherent financial and non-financial risks of the various business activities; 

(ii) Evaluation of risks in terms of the likelihood of occurrence and potential impact; 

(iii) The actions established in order to mitigate those inherent risks; 

(iv) Evaluation of the residual risks remaining after taking into consideration the mitigating actions; 

(v) Associated risk owners who are members of the Senior Management within the Company who have a 

hands-on approach to assess and manage the risks as a first line of defence. 

The key risks are reported to the Board through the Audit and Risk Management Committee. The Board 

believes that the internal control and risk management of the Company provide reasonable assurance that 

control and risk issues are identified, reported on and dealt with appropriately. 

The categories in which risks have been analysed for ENL Commercial are Financial, Operational, Customer, 

People and System. The significant risks identified under these categories are as follows: 

Financial 

Financial Risk Management is analysed in Note 3 to the Financial Statements, on pages 78 to 81 and 

includes a discussion of the following types of risk: 

(a) Market risk which includes: 

(i) currency risk 

(ii) price risk 

(iii) cash flow and fair value interest risk 

(b) Credit risk 

(c) Liquidity risk 



43


(continued) 

Operational 

Operational risk encompasses a wide range of areas of business that may result in operations being 

inefficient and ineffective in satisfying customers and achieving the Group’s quality, cost and time objectives. 

The Group takes adequate measures by continuously appraising and reviewing its operational and financial 

policies to ensure effectiveness of a sound internal control environment and thereby minimising its exposure 

to operational risks. 

A close review is also done by ENL’s Internal Audit Department to ensure that the mitigating actions are 

adequate and strictly adhered to for matters with high inherent risk. Any deviation is reported to Management 

for prompt remedial actions and subsequently to the Board through the Audit and Risk Management 

Committee. 

The main Operational risks and the corresponding mitigating actions are: 

• Reliance on key suppliers: The Group depends to a large extent on its key suppliers and contractors 

for sourcing of its raw materials, finished goods and services distributed both on the local and foreign 

markets. In this respect, the business ensures adequacy and compliance with its internal business 

policies and procedures. The business also endeavours to maintain a good and lasting relationship 

with the key suppliers in line with its shared values. 

• Production, machinery and equipment: Given the capital intensive nature of some activities, the 

Group ensures that replacement of machines and adequate maintenance of machines is undertaken 

to ensure sustainable performance and efficiency in its production operations. 

• Production planning: In the absence of structured planning, the business may face the risk of nonoptimisation 

of production capacity and hence, efficiency. To this end, management makes use of 

properly structured and dynamic production planning and monitoring tools that provide valuable 

information to enable effective decision-making. 

• Procurement and Stock: An optimal stock level may not be kept with the risk of stock out and in 

situation of excessive stock level, unnecessary cash being tied up and risk of stock obsolescence. 

Management closely monitors the stock level. 

Risks are further mitigated by transferring certain risks to external parties such as insurance companies or 

via outsourcing of business processes. 

Customer 

The success of the Group is based on its ability to adapt rapidly to evolving customer needs and the 

provision of value-added customer services. At the operational level, each entity of the Group maintains a 

close relationship with its respective clients/business counterparts to ensure that standards of quality are 

adhered to. At Group level, the CEO regularly and closely reviews the strategy of each entity and corrective 

actions (if any) are taken promptly. 

As changes in the economic outlook may have adverse impact on the operating profits or value of the 

Group’s assets, each entity has implemented appropriate marketing, sales and customer care strategies to 

enable sustainable growth of the customer portfolio while delivering the desired level of quality of service 

provided to the business’s valued customers. 

In accordance with the core values of the business, the Group aims at promoting long-term and lasting 

relationships with its clients who are supported by Management’s vision and focus in achieving customer 

satisfaction. 

44 

People and System 

The Group is highly dependent on its people and management information systems for smooth running of 

its operations as well as for reporting and decision-making purposes. 

ENL Commercial and its Subsidiaries benefit from support in respect of Human Resource (HR) and 

Information Technology (IT) from ENL Limited. This also ensures that a coherent and consistent policy/ 




(continued) 

strategy with regard to HR and IT systems are maintained across the Group. 

People and system risks and their corresponding mitigating actions are: 

• HR risks: which relate to losses arising from acts inconsistent with employment practices. With 

the assistance of the HR function, the Group adheres to fair policies and practices on recruitment, 

employee treatment, hiring, dismissal and disciplinary procedures amongst others. 

• Health and safety risks: may arise in the event of non-compliance to health and safety laws that 

may entail personal injury claims. The Group also endeavours to comply with the industry’s health 

and safety norms and regulations to provide a safe working environment for its employees, which is 

conducive to higher employee welfare and productivity. 

• Information processing and technology risks: The loss of critical electronic data due to IT system 

failure and/or failure of back-ups is an inherent risk for most businesses. The Management Information 

System is also a key tool for management to have ready information for monitoring of the activities of 

the Group and taking prompt decisions. Given the importance placed by Management on this aspect, 

the business has invested in physical and human capital to reinforce controls pertaining to the IT 

environment namely as regards to the IT infrastructure, firewalls and systems back-ups. 

Internal Audit assignments also cover areas of significant residual HR and IT risks and where necessary, 

action plans are prepared and corrective actions taken by management. Residual risks on HR and IT issues 

are regularly monitored by the management of each entity and closely reviewed by senior management at 

Group level. 

Share Option Plans 

ENL Commercial Limited has no share option plans. 

Shareholders’ Relations and Communication 

The Company communicates to its shareholders through Annual Report, circulars issued in compliance 

with the Listing Rules of the Stock of Exchange of Mauritius Limited, press announcements, publication of 

unaudited quarterly and audited abridged financial statements of the Company, dividend declaration and 

the Annual Meeting of shareholders. 

Also Board members attend the Annual Meeting, to which all shareholders are invited. 

Shareholders’ Calendar 

End of financial year June 30 

Publication of Quarterly financial statements/ abridged audited 

financial statements 

Annual Report issued 

Forthcoming Annual Meeting of Shareholders 

Declaration of dividend 

Payment of dividend 

February/ May/ September/November 

November 

December 

November /June 

December/July 



45


(continued) 

Stock Market Information 

The Company’s ordinary shares are listed on the Official List of the Stock Exchange of Mauritius Limited. 

Accordingly, the Company is governed by the Listing Rules of the Stock Exchange of Mauritius Limited. 

Hereunder is the graphical representation of the price movement of the Company’s ordinary shares from 

July 1, 2010 to July 1, 2011. 

ENL Commercial Limited - Share Price Movement 

Semdex 

ENL Commercial 

180 

160 

140 

120 

100 

80 

60 

40 

Jul 

10 

Aug 

10 

Sep 

10 

Oct 

10 

Nov 

10 

Dec 

10 

Jan 

11 

Feb 

11 

Mar 

11 

Apr 

11 

May 

11 

Jun 

11 

Jul 

11 

Code of Ethics 

The Company is committed to high standards of integrity and ethical conduct in dealing with its stakeholders. 

The Company adheres to the Code of ethics issued by the Mauritius Employers’ Federation and Model 

Code of Conduct for Directors and employees of private sector companies issued by the Joint Economic 

Council. 

The group also systematically ensures that the employees are aware of and adhere to its core values. 

Health and Safety 

The Company and its subsidiaries strive to maintain a working environment that is free from hazards and 

risk of injury to all employees and others. Business is organised in a responsible manner and systems 

of work preserve the health and safety of our employees and other people concerned with the Group’s 

activities. 

To meet these commitments, the Company and its subsidiaries: 

• comply with The Occupational Safety and Health Act 2005 and other legislative and regulatory 

frameworks. 

• give information, instruction, training and supervision to ensure that employees are aware of their legal 

responsibility. 

46 




(continued) 

• wherever applicable, subsidiaries have employed Health and Safety officers and/or established Health 

and Safety Committees to ensure that the legal framework is complied with and contribute to the well 

being of their employees. 

Company Secretary 

ENL Limited provides corporate secretarial services to ENL Commercial Limited in accordance with the 

terms of a management contract binding the two companies. 

All Directors have access to the advice and services of the Company Secretary delegated by ENL Limited. 

The Company Secretary is responsible to the Board for ensuring proper administration of Board proceedings. 

The Company Secretary provides guidance to Directors on matters of company law and with regard to their 

responsibilities in the statutory environment in which the Company operates. 

The Directors are entitled to seek independent professional advice at the Company’s expense. 

Auditor’s Fees 

The fees paid to the auditors for audit and other services are disclosed on page 60 of the Annual Report. 

Donations 

The aggregate amounts of political and other donations made during the year under review are disclosed 

on page 59 of the Annual Report. 

Corporate Social Responsibility 


Following a group policy decision in 2009 to set up a dedicated structure to manage, implement and 

finance all the social projects of the Group, ENL Commercial now channels all its CSR initiatives through 

ENL Foundation. Incorporated in January 2010 as a not for profit private company, ENL Foundation 

spearheads the Group’s initiatives in this field and is entrusted with the responsibility to manage, implement 

and finance all CSR projects of the Group, in collaboration with existing Non-governmental Organisations 

(NGOs) and corporate partners. In March 2010, ENL Foundation received its accreditation to the National 

CSR Committee. 

ENL Foundation focuses its CSR initiatives on the empowerment of the youth and preservation/ enhancement 

of the natural environment of Mauritius. Both initiatives contribute towards a qualitative evolution of the 

social and natural environment. 

For the year ended June 30, 2011, ENL Foundation received a total contribution of Rs 9.5M out of which 

ENL Commercial contributed an amount of Rs 0.4m to ENL Foundation. This sum represents the CSR levy 

to the tune of 2% of profit after tax imposed by Government on all companies as from June 2009. 



47


(continued) 

Corporate Social Responsibility (continued) 

Corporate Programme 

ENL Foundation works in accordance with a comprehensive CSR Programme as approved by the National 

CSR Committee. The said programme encompasses various social and environmental projects. 

A number of projects have been implemented in partnership with NGOs at regional and national levels in the 

field of social integration, education and training, promotion of youth health, youth development through 

sports and leisure, prevention of substance abuse targeting particularly youth in vulnerable localities, arts 

& culture and preservation of the environment. Non-governmental Organisations like Mauritius Wild Life 

Foundation, Caritas, Fondation Pour la Formation au Football, Junior Achievement Mascareignes have 

benefited funds to promote their respective initiatives. 

Furthermore, ENL Foundation adheres to the Government sponsored national program for the eradication 

of absolute poverty in the island. As such, ENL Foundation is actively involved in the alleviation of poverty 

in the Moka/St Pierre and L’Escalier regions. 

A full report on ENL Foundation is set out on pages 50 to 55. 

ENL Limited 


September 30, 2011 

48 



Share Analysis 

Distribution of Shareholders at June 30, 2011 

Range of shareholding Shareholder Count No. of shares owned % Shares owned 

1-500 559 106,196 0.36 

501-1000 271 215,693 0.74 

1001-5000 438 1,163,157 3.99 

5001-10,000 138 1,004,891 3.44 

10,001-50,000 126 2,675,493 9.17 

50,001-100,000 21 1,406,766 4.82 

100,001-250,000 9 1,105,016 3.79 

250,001-500,000 3 1,105,341 3.80 

Over 500,000 6 20,389,947 69.89 

Total 1571 29,172,500 100.00 

To the best knowledge of the Directors, the spread of shareholders at June 30, 2011 was as follows: 

No of Shareholders Shares held % 

Individuals 1,400 7,302,440 25.03 

Insurance & Assurance Cos 5 763,506 2.62 

Pension & Provident Funds 5 521,632 1.79 

Investment & Trust Cos 9 681,785 2.34 

Other Corporate Bodies 152 19,903,137 68.22 

Total 1,571 29,172,500 100.00 



49

Mario Radegonde ( ENL Foundation Manager ) 

50 





51

The ENL Group has always considered corporate citizenship as an essential part of its existence. ENL 

Foundation, which spearheads the CSR initiatives of the ENL Group, had, during the financial year ended 

June 30, 2011, devoted its efforts into consolidating its CSR actions initiated since January 2010. 

The budget of ENL Foundation has increased by 27%, from Rs 7.5m to Rs 9.5m, for the year ended June 

30, 2010 and 2011 respectively. While the CSR contributions received from the subsidiaries of the ENL 

Group represented 82 % of the total CSR value, 18% had been received from associated and external 

companies. During the current financial year, ENL Foundation led and supported a number of new projects 

to drive a positive change in its areas of focus. 

Furthermore, ENL Foundation kept a tight lid on its administrative costs, which represented 12% of its total 

expenditure, in compliance with guidelines set by the Government. The Foundation perused its traineeship 

programme with the double purpose of providing fresh graduates from tertiary institutions, with hands-on 

experience while at the same time, ensuring an additional supply of resources to the Foundation. 

During the financial year for the year ended June 30, 2011, the funds of ENL Foundation had been put to 

use to support programmes in the following areas: 

1. Education & Learning 

ENL Foundation devoted 18% of its budget to Education and Learning initiatives, namely by: 

i. Providing continued support to La Baraque Learning Centre in partnership with Omnicane Foundation. 

As at 30 June 2011, some 150 adults and 160 children had followed literacy programmes and 

qualification-based training in IT at the centre. 

ii. Consolidating the ‘Programme d’Accompagnement Scolaire’ launched in Pailles West in the previous 

financial year, with the contribution of a psychologist to provide training and supervision. The number of 

children in attendance doubled to 50 and the programme was then also extended to Pailles East. Some 

80 other children attending ZEP school in the region are now given guidance by trained educators from 

the Ruth School. 

iii. Providing Tertiary scholarship schemes to supporting three youngsters from poverty-stricken regions 

who would be completing their studies at the Charles Telfair Institute in the coming financial year. The 

Foundation also gave the opportunity to two teenagers from Cite Ste Catherine, through its recently set 

up ‘Secondary School Support Programme’, in collaboration with Caritas, to resume their secondary 

studies with the Open College Educational Programme (OCEP). 

2. Training 

The Foundation dedicated the equivalent of 19% of its budget to Training & Development programmes. 

i. ENL Foundation remains a major partner of Junior Achievement Mascareignes (JAM). Between January 

and June 2011, some 5,500 students in 63 colleges received training through the JA Notre Quartier 

programme, in which employees of the ENL Group were also actively involved as volunteers. The 

number of ENL volunteers participating in the Junior Achievement Programme rose from 12 in the 

previous financial year to 18 in the current financial year; 

ii. In partnership with the Civic Action Team, the Foundation contributed to the setting up of various 

training programmes conducted at the ’Centre de Formation et d’Apprentissage Technique de Pailles’. 

Prior to launching the courses, a study was undertaken to identify the training needs of the inhabitants. 

As at 30 June 2011, a total of some 170 children and youngsters, young ladies and unemployed 

people, received training in hairdressing, masonry, fabric hand painting, first-aid, English Literacy using 

Information Technology (ELIT) and parents’ schooling. 

52 




(continued) 

3. Eradication of Absolute Poverty Programme 

ENL Foundation committed 9% of its budget to the national Eradication of Absolute Poverty (EAP) 

programme. These funds were mainly devoted to: 

i. Setting up a Day Care Centre at L’Escalier to provide a rehabilitation facility closer to people having 

drugs, alcohol and substance abuse problems living in the South of the island. In continuation to a 

counselling service launched in February 2010, ‘L’Oasis nu l’espwar’ was set up jointly with Omnicane 

Foundation and the National Empowerment Foundation in March 2011 and some 30 people followed 

the programme. 

ii. Providing toilet and sanitary ware facilities to deprived households in Moka/St Pierre and Ste Catherine. 

The project is due to be completed in the coming financial year; 

iii. Launching of a Breakfast Support Programme since April 2011. With the collaboration of benevolent 

ladies living in the local community, a balanced breakfast is provided on weekdays to some 53 school 

children of Camp Tagore and La Sourdine; 

iv. The financing of training in food processing at the Agricultural Research & Extension Unit Training 

Centre in Wooton for a dozen of unemployed women from Cite Ste Catherine and La Laura. 

4. Actions geared towards Vulnerable Children 

In the course of financial year 2010/2011, 5% of the Foundation’s budget was spent on actions geared 

towards Vulnerable Children, namely: 

i. The launch of a programme dedicated to promote creativity and artistic awakening for some 40 young 

children in Alma and Cite Ste Catherine in collaboration with the ‘Association Culturelle de Sensibilisation 

et d’Eveil artistique’ (ACSEA); 

ii. The setting up of an Ecole de chant targeting some 50 children in Pailles and Ste Catherine with the 

collaboration of ‘Fondation Spectacle & Culture’. 

iii. The launch of ‘Zenfans Sourire Alma’ with the aim of providing healthy leisure activities to some 25 

underprivileged children in Alma in association with NGO ACSEA. 

iv. Books for Success 2011 operation aiming at distributing reading books and school materials to 

underpriviledged children of Alma and Cite Ste Catherine as well as La Sourdine village. This operation 

has gained its momentum among the ENL staff who offered books and school materials to some 400 

children. 

v. Promoting sports through the support of ‘Ecole de foot de l’Agrement’ for the second year in collaboration 

with the Fondation pour la Formation au Football. 

5. Environmental Projects 

ENL Foundation earmarked 5% of its budget to environmental projects including: 

i. A contribution to the Mauritian Wildlife Foundation’s endeavour to protect the Pink Pigeon, an endemic 

bird specy in Mauritius. 

ii. The embellishment and clean up campaign in its regions of intervention, namely Cité Dargahed in 

Pailles, La Sourdine and Moka; 

iii. The organisation of a mini-carnival on 4 June 2011 in the context of the World Environment Day. The 

event held in collaboration with the Agricultural Society of the University of Mauritius, attracted some 

250 participants; 

iv. The projection on an ongoing basis of documentary films to sensitise the youth in the regions of 

intervention of the Foundation of the importance of preserving our environment. 



53


(continued) 

The Foundation showed its commitment to youth development by devoting 4% of its budget to this item, 

namely through: 

i. Funding a programme conducted by the LEAD NGO to sensitise the youth to social issues such as 

drugs, alcohol and HIV/AIDS; 

ii. Implementing leadership courses targeting some 60 youngsters in Ste Catherine, Alma and Pailles 

regions; 

iii. Sponsoring a campaign against youth violence run by the Chapter of the JCI of Quatre Bornes. 

ENL Foundation spent 5% of its budget in the promotion of sports, arts & leisure and recreational activities. 

Besides its contribution at national level, ENL Foundation supported ongoing educational and recreational 

activities in Pailles, L’Escalier/La Sourdine, Ste Catherine and Alma. The Foundation also offered support on 

this count through the donation of sports equipment. These activities targeted more than 350 youngsters 

within the mentioned regions. 

ENL Foundation donated 18% of its budget to NGOs accredited to the National CSR Committee and to 

Corporate Partners to finance various programmes at national level, namely Caritas Ile Maurice, ICJM for 

its project Les Amis de Zippy, Baden Powell Scout Ass., Mahatma Gandhi Institute (Basic Guardina School 

at Moka), Open Mind, Action Familiale, Link to Life, Fondation Pour L’enfance Terre de Paix, etc. offering 

services in the field of Health, Handicap, Socio Economic Development, Youth development, etc. 

In the coming financial year, ENL Foundation intends to make necessary adjustments in its corporate 

program in order to align itself with the Government’s appeal in the 2011 National Budget to use 50% 

of CSR resources to support three National Programmes namely social housing, vulnerable children and 

eradication of absolute poverty. 

In addition to providing its support to ongoing initiatives, a number of new projects have also reached an 

advanced stage of completion. These include a multi-purpose centre to promote youth empowerment 

in Ste Catherine and a ‘Maison de l’Entreprenariat et de l’Artisanat’ in St Pierre in collaboration with the 

ACSEA to act as a business incubator for women entrepreneurs and craftspeople in the region. 

54 




(continued) 

Breakdown of Funds by Area of Focus (%) 

Education-Learning-Training 

37 19 

5 

EAP & Vulnerable 

Children Projects 

Environmental Projects 

9 

Sports-Arts-Leisure & 

Youth Development 

18 

Support to NGOs and 

Corporate Partners 

12 

Administrative costs 



55


In Respect of Financial Statements 

Company law requires the Directors to prepare financial statements for each financial year, which present 

fairly the financial position, financial performance and cash flow of the Company. In preparing those financial 

statements, the Directors are required to: 

• select suitable accounting policies and then apply them consistently; 

• make judgments and estimates that are reasonable and prudent; 

• state whether international financing reporting standards have been followed and complied with, 

subject to any material departures being disclosed and explained in the financial statements; and 

• prepare the financial statements on a going-concern basis unless it is inappropriate to presume that 

the company will continue in business. 

The Directors confirm that they have complied with the above requirements in preparing the Company’s 

financial statements. 

The Directors are responsible for keeping proper accounting records, which disclose with reasonable 

accuracy the financial position of the Company at any time and enable them to ensure that the Financial 

Statements comply with The Companies Act 2001. They are also responsible for safeguarding the assets 

of the Company and hence for taking reasonable steps to prevent and detect fraud and other irregularities. 

The Board is responsible for the system of internal control and risk management for the Company and its 

subsidiaries. The Board is committed to continuously maintain a sound system of risk management and 

adequate control procedures with a view to safeguarding the assets of the Group. 

The Board believes that the Group’s systems of Internal control and risk management provide reasonable 

assurance that control and risk issues are identified, reported on and dealt with appropriately. 

ENL Limited (ENL) provides internal audit services to ENL Commercial Limited in accordance with the terms 

of the management contract with the company. ENL’s internal audit department also conducts regular 

audits at ENL Commercial Limited’s subsidiaries. ENL’s Chief Internal Auditor reports independently to the 

Company’s Audit and Risk Management Committee on all internal audit issues. 

Nothing has come to the Board’s attention, to indicate any material breakdown in the functioning of the 

internal controls and systems during the period under review, which could have a material impact on the 

business. The financial statements are prepared from the accounting records on the basis of consistent 

use of appropriate accounting policies supported by reasonable and prudent judgments and estimates that 

fairly present the state of affairs of the Group and the Company. 

Guy RIVALLAND 

Chairman 


Director 

56 



Other Statutory Disclosures 

(Pursuant to Section 221 of The Companies Act 2001 and Section 88 of The Securities Act 2005) 


The names of directors of subsidiaries holding office at June 30, 2011 and those who ceased to hold office 

during the accounting period are stated below: 

Axess Limited 


Hector Espitalier-Noël 

Bertrand Daruty de Grandpré 

Olivier Lagesse (appointed on April 12, 2011) 

Antoine D’Unienville (appointed on April 12, 2011) 

Charabia Ltd 

Eric Espitalier-Noël (appointed on May 25, 2011) 

Olivier Lagesse (appointed on May 25, 2011) 

Marie Thérèse Catherine Paturau (resigned on May 25, 2011) 

Marie Claire Régine Sauzier (resigned on May 25, 2011) 


Eric Espitalier-Noël (appointed on January 19, 2011) 

Hector Espitalier-Noel 

Jean Claude Roussel Giraud 

Benoit Doger de Spéville Hardy (appointed on January 19, 2011) 

Bernard Rougier Lagane 




M. P. Roger Espitalier-Noël 


(effective July 01, 2011 Grewals (Mauritius) Limited has amalgamated with Grewals Contracting Ltd and 

Grewals (Mauritius) Limited now remains as the amalgamated company) 






Yvan Mainix (resigned on September 15, 2010) 












57



June 30, 2011 (continued) 








Olivier Lagesse (appointed on April 8, 2011) 

Frédéric Tyack (appointed on April 8, 2011) 




Directors’ Service Contracts 

None of the Directors proposed for the election at the following annual meeting has service agreements 

with the Company. 

Directors’ and Senior Officers’ Interests in Shares 

(i) 

(ii) 

(ii) 

The interests of the Directors in the securities of ENL Commercial Limited at June 30, 2011 are found 

on page 34 of the Annual Report. 

None of the directors of the Company has a direct interest in the equity of the subsidiaries of the 

Group. 

None of the senior officers (excluding directors) of the Company hold any direct or indirect interests in 

the securities of ENL Commercial Limited and its subsidiaries as at June 30, 2011. 

Directors’ Remuneration and Benefits 

Remuneration and benefits (including bonuses and commissions) received and receivable from the 

company and its subsidiaries were as follows: 

- Directors of ENL Commercial Limited 

From 

the Company 

From the 

Subsidiaries 

Remuneration from 

companies on which 

Director serves as 

representative of the 

Company 

2011 2010 2011 2010 2011 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Executive 

- Full-time 

- Part-time 

- 

248 

- 

- 

- 

- 

- 

- 

- 

- 

Non-executive 885 1,148 - - - 

Post employment benefits 

- Executive Directors 

- - - - 

- 

1,133 1,148 - - - 

58 






- Directors of subsidiary companies who are not Directors of the Company 

2011 2010 

Rs’000 

Rs’000 

Executive 

- Full-time - - 

- Part-time - - 

Non-executive - - 

- - 

Indemnities and Insurance 

A Directors’ and Officers’ Liability Insurance policy has been subscribed to by the holding company. The 

policy provides cover for the risks arising out of the acts or omissions of the Directors and Officers of the 

Company. The cover does not provide insurance against fraudulent, malicious or wilful acts or omissions. 

Contracts of Significance 

The Company has a management contract with ENL Limited for provision of management and secretarial 

services as detailed in the corporate governance report. 

Shareholders 

At September 8, 2011, the following shareholders were directly or indirectly interested in more than 5% of 

the ordinary share capital of the Company: 

Interest (%) 

No. of shares 

ENL Limited 46.55 13,580,390 

ENL Investment Limited 14.77 4,310,173 

Donations 

Donations made during the 

year by: 

Number of 

recipients 


Rs ‘000 

Number of 

recipients 

Rs ‘000 

Charabia Ltd 1 31 - - 

ENL Commercial Limited 1 110 - - 

Grewals (Mauritius) Limited 1 59 - - 

Rennel Ltd 1 12 - - 

Pack Plastics Limited 1 21 1 7 

Emballages Limited - - 1 1 

The Company and subsidiaries not listed above did not make any donation during the year. The Group did 

not incur any political donation during the year. However, all profitable subsidiaries have made their CSR 

contributions to ENL Foundation. 



59




Auditors’ Fees 

The fees paid to the auditors, for audit and other services, were: 


Audit Other Services Audit Other Services 

Rs’000 Rs’000 Rs’000 Rs’000 

ENL Commercial Limited 130 300 100 300 

Packestate Ltd 39 11 32 7 

Société Réunion 12 4 5 1 

Grewals Rodrigues Ltd - - 30 7 

Grewals Contracting Ltd 72 10 70 12 

Grewals (Mauritius) Ltd 255 - 212 37 

Pack Plastics Limited 170 14 120 14 

Axess Ltd 648 - 500 103 

Rennel Ltd 161 - 130 10 

Charabia Ltd 212 - - - 

Cogir Limitée 175 29 - - 

Emballages Limited * - - 120 12 

Plastinax Austral Limitée - 23 - - 

*Emballages Limited was amalgamated with Pack Plastics Limited during the year. 

Other services comprise of audit fees for consolidation and taxation fees. 

60 



Company Secretary’s Certificate 

(Pursuant to Section 166(d) of the Companies Act 2001) – June 30, 2011 

We certify that, to the best of our knowledge and belief, the Company has filed with the Registrar of 

Companies all such returns as are required of the Company under the Companies Act 2001. 

ENL Limited 




Port Louis 




61

Independent Auditors’ Report to the Members 

This report is made solely to the members of ENL Commercial Limited (the “company”), as a body, in 

accordance with Section 205 of the Companies Act 2001. Our audit work has been undertaken so that we 

might state to the company’s members those matters we are required to state to them in an auditors’ report 

and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility 

to anyone other than the company and the company’s members as a body, for our audit work, for this 

report, or for the opinions we have formed. 

Report on the Financial Statements 

We have audited the financial statements of ENL Commercial Limited and its subsidiaries (the “group”) 

and the company’s separate financial statements on pages 65 to 111 which comprise the statements of 

financial position at June 30, 2011, the statements of comprehensive income, statements of changes in 

equity and statements of cash flows for the year then ended, and a summary of significant accounting 

policies and other explanatory notes. 

Directors’ Responsibility for the Financial Statements 

The directors are responsible for the preparation and fair presentation of these financial statements in 

accordance with International Financial Reporting Standards and in compliance with the requirements of 

the Companies Act 2001. This responsibility includes: designing, implementing and maintaining internal 

control relevant to the preparation and fair presentation of financial statements that are free from material 

misstatements, whether due to fraud or error, selecting and applying appropriate accounting policies, and 

making accounting estimates that are reasonable in the circumstances. 

Auditors’ Responsibility 

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted 

our audit in accordance with International Standards on Auditing. Those Standards require that we comply 

with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the 

financial statements are free from material misstatements. 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures 

in the financial statements. The procedures selected depend on the auditors’ judgement, including the 

assessment of the risks of material misstatements of the financial statements, whether due to fraud or 

error. In making those risk assessments, the auditors consider internal control relevant to the company’s 

preparation and fair presentation of the financial statements in order to design audit procedures that are 

appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness 

of the company’s internal control. An audit also includes evaluating the appropriateness of accounting 

policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating 

the overall presentation of the financial statements. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our 

audit opinion. 

Opinion 

In our opinion, the financial statements on pages 65 to 111 give a true and fair view of the financial position 

of the group and of the company at June 30, 2011, and their financial performance and their cash flows for 

the year then ended in accordance with International Financial Reporting Standards and comply with the 

Companies Act 2001. 

62 



Independent Auditors’ Report to the Members 

(continued) 

Report on Other Legal and Regulatory Requirements 

Companies Act 2001 

We have no relationship with, or interests in, the company or any of its subsidiaries, other than in our 

capacity as auditors, tax and business advisers and dealings in the ordinary course of business. 

We have obtained all information and explanations we have required. 

In our opinion, proper accounting records have been kept by the company as far as it appears from our 

examination of those records. 

Financial Reporting Act 2004 

The directors are responsible for preparing the corporate governance report and making the disclosures 

required by section 8.4 of the code of Corporate Governance of Mauritius (“code”). Our responsibility is to 

report on these disclosures. 

In our opinion, the disclosures in the corporate governance report are consistent with the requirements of 

the code. 

BDO & CO 

Chartered Accountants 

Yacoob RAMTOOLA (FCA) 

Licensed by FRC 


Port Louis, 

Mauritius. 



63

FINANCIAL STATEMENTS 

64 



Statements of Financial Position 


THE GROUP 

THE COMPANY 

Notes 2011 2010 2011 2010 

Rs’000 Rs’000 Rs’000 Rs’000 

Assets 

Non current assets 

Property, plant and equipment 5 622,483 402,795 - - 

Intangible assets 6 124,301 27,212 - - 

Investments in subsidiary companies 7 - - 803,199 581,815 

Investments in associates 8 35,986 22,288 65,163 160,314 

Investments in financial assets 9 28,086 835,286 - 826,550 

Deposit on investment 10 9,321 52,891 9,321 57,891 

820,177 1,340,472 877,683 1,626,570 

Current assets 

Inventories 11 413,813 286,622 - - 

Trade and other receivables 12 556,586 268,725 4,485 9,035 

Amounts receivable from group companies 13 10,945 25,490 66,800 57,698 

Held for trading securities 14 3,756 3,756 3,756 3,756 

Cash and cash equivalents 47,325 11,189 119 489 

1,032,425 595,782 75,160 70,978 

Non-current assets classified as held for sale 15 679,872 - 679,872 - 

Total assets 2,532,474 1,936,254 1,632,715 1,697,548 

Equity and Liabilities 

Capital and reserves 

Share capital 16 177,960 177,960 177,960 177,960 

Reserves 878,352 926,488 1,191,802 1,300,459 

Equityholders’ interests 1,056,312 1,104,448 1,369,762 1,478,419 

Non-controlling interests 17,389 80 - - 

Total equity 1,073,701 1,104,528 1,369,762 1,478,419 

Liabilities 

Non-current liabilities 

Borrowings 17 403,018 134,929 134,714 33,921 

Deferred tax liabilities 18 27,635 3,307 - - 

Retirement benefit obligations 19 47,493 19,173 - - 

Deferred income 20 610 - - - 

478,756 157,409 134,714 33,921 

Current liabilities 

Trade and other payables 21 444,866 168,392 2,476 3,513 

Amounts payable to group companies 22 161,410 152,906 11,088 24,291 

Current tax liabilities 23 3,173 5,558 84 78 

Borrowings 17 355,982 335,792 100,005 145,657 

Proposed dividends 24 14,586 11,669 14,586 11,669 

Total liabilities 980,017 674,317 128,239 185,208 

Total equity and liabilities 2,532,474 1,936,254 1,632,715 1,697,548 

These financial statements have been approved for issue by the Board of Directors on September 30, 2011. 

Guy RIVALLAND 

Chairman 


Director 

The notes on pages 70 to 111 form an integral part of these financial statements. 

Auditors’ report on pages 62 and 63. 



65

Statements of Comprehensive Income 

Year ended June 30, 2011 

THE GROUP 


Investment & 


Notes management Commercial Industry Total management Commercial Industry Total 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Sales - 1,523,708 1,108,084 2,631,792 - 1,292,847 52,810 1,345,657 

Cost of sales - (1,252,245) (969,383) (2,221,628) - (1,049,176) (40,564) (1,089,740) 

Gross profit - 271,463 138,701 410,164 - 243,671 12,246 255,917 

Investment and other income 16,459 - - 16,459 21,134 - - 21,134 

16,459 271,463 138,701 426,623 21,134 243,671 12,246 277,051 

Other operating expenses - (43,056) (44,268) (87,324) - (33,429) (3,810) (37,239) 

Administrative expenses (13,260) (176,058) (50,078) (239,396) (10,937) (173,552) (6,209) (190,698) 

Other operating income - 26,815 4,318 31,133 - 17,135 767 17,902 

3,199 79,164 48,673 131,036 10,197 53,825 2,994 67,016 

Fair value gain on 

held-for-trading securities 14 - - - - 1,490 - - 1,490 

Share of results of 

associates - (4,925) 988 (3,937) (4,465) (3,045) 2,750 (4,760) 

Finance costs 27 (17,487) (41,153) (15,376) (74,016) (12,041) (16,214) (790) (29,045) 

(14,288) 33,086 34,285 53,083 (4,819) 34,566 4,954 34,701 

Profit on disposal of investments 5,131 - 899 6,030 2,159 - - 2,159 

Provision for guarantee - - - - - (2,939) - (2,939) 

Fair value adjustment of 

financial liabilities - - 156 156 - - - - 

Fair value gain arising on 

business combination 41,159 - - 41,159 - - - - 

Profit before taxation 25 32,002 33,086 35,340 100,428 (2,660) 31,627 4,954 33,921 

Income tax expense 23 (109) (7,385) (2,671) (10,165) (134) (7,192) (96) (7,422) 

Profit for the year 31,893 25,701 32,669 90,263 (2,794) 24,435 4,858 26,499 

Other comprehensive 

income: 

Fair value movement on 

available for sale financial 

assets (163,696) - - (163,696) (36,999) - - (36,999) 

Share of comprehensive 

income of associates 2,689 - - 2,689 5,349 - - 5,349 

Surplus on revaluation of 

properties net of deferred tax - 52,126 3,756 55,882 - - - - 

28 (161,007) 52,126 3,755 (105,125) (31,650) - - (31,650) 

Total comprehensive 

income for the year (129,114) 77,827 36,425 (14,862) (34,444) 24,435 4,858 (5,151) 

Profit attributable to: 

Owners of the company 31,893 25,701 27,399 84,993 (2,794) 24,502 4,858 26,566 

Non-controlling interests - - 5,270 5,270 - (67) - (67) 

31,893 25,701 32,669 90,263 (2,794) 24,435 4,858 26,499 


income attributable to: 

Owners of the company (129,114) 77,827 29,312 (21,975) (34,444) 24,502 4,858 (5,084) 

Non-controlling interests - - 7,113 7,113 - (67) - (67) 

(129,114) 77,827 36,425 (14,862) (34,444) 24,435 4,858 (5,151) 

Earnings per share 29 Rs. 2.81 Rs. 0.91 



66 



Statements of Comprehensive Income 


THE COMPANY 

Notes 2011 2010 

Rs’000 Rs’000 

Investment and interest income 51,871 45,122 

Administrative expenses (12,068) (10,115) 

39,803 35,007 

Fair value gain on held-for-trading securities 14 - 1,490 

Finance costs 27 (17,272) (11,784) 

22,531 24,713 

Profit on disposal of investments 7,623 2,159 

Provision-written back 317 - 

Profit before taxation 25 30,471 26,872 

Income tax expense 23 (96) (72) 

Profit for the year 30,375 26,800 

Other comprehensive income: 


available for sale financial assets (104,768) 14,829 

Release to income on disposal 

of available for sale financial assets (8,009) - 

28 (112,777) 14,829 

Total comprehensive income for the year (82,402) 41,629 

Earnings per share 29 Rs 1.04 0.92 





67

Statements of Changes In Equity 


(a) 

THE GROUP 

Attributable to equity holders of the company 

Holding company 

and subsidiaries 

Fair value 

Non- 

Share Associated and other Retained controlling Total 

Notes capital companies reserves earnings Total interests equity 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Balance at July 1, 2010 177,960 (13,340) 279,400 660,428 1,104,448 80 1,104,528 

Transfer - - (1,000) 1,000 - 257 257 

Transfer to retained 

earnings on business combination - 30,107 - (30,107) - - - 

Effect of change in ownership 

not resulting in loss of control - - 1,704 (1,610) 94 (94) - 

Acquisition of subsidiaries - - - - - 415 415 

Issue of shares in subsidiaries 

to non-controlling shareholders - - - - - 10,000 10,000 

Transfer to retained earnings 

on disposal of subsidiaries - - (8,645) 8,645 - - - 


income for the year - (4,425) (109,657) 92,107 (21,975) 7,113 (14,862) 

Dividends 24 - - - (26,255) (26,255) - (26,255) 

Dividend paid by subsidiaries and 

associates to non-controlling shareholders - - - - - (382) (382) 

Balance at June 30, 2011 177,960 12,342 161,802 704,208 1,056,312 17,389 1,073,701 

Balance at July 1, 2009 177,960 (7,029) 316,399 645,540 1,132,870 147 1,133,017 

Total comprehensive income 

for the year - (6,311) (36,999) 38,226 (5,084) (67) (5,151) 

Dividends 24 - - - (23,338) (23,338) - (23,338) 

Balance at June 30, 2010 177,960 (13,340) 279,400 660,428 1,104,448 80 1,104,528 

(b) 

THE COMPANY 

Share Fair value and Retained 

Note capital other reserves earnings Total 

Rs’000 Rs’000 Rs’000 Rs’000 

Balance at July 1, 2010 177,960 619,047 681,412 1,478,419 


for the year - (112,777) 30,375 (82,402) 

Dividends 24 - - (26,255) (26,255) 

Balance at June 30, 2011 177,960 506,270 685,532 1,369,762 

Balance at July 1, 2009 177,960 604,218 677,950 1,460,128 


for the year - 14,829 26,800 41,629 

Dividends 24 - - (23,338) (23,338) 

Balance at June 30, 2010 177,960 619,047 681,412 1,478,419 



68 



Statements of Cash Flows 


THE GROUP 

THE COMPANY 

Notes 2011 2010 2011 2010 

Rs’000 Rs’000 Rs’000 Rs’000 

Cash flows from operating activities 

Cash generated from operations 30(a) 95,011 87,321 20,990 35,316 

Income tax paid (11,498) (6,738) (90) (408) 

Net cash generated from 

operating activities 83,513 80,583 20,900 34,908 

Cash flows from investing activities 

Purchase of investments in associates (4,363) (1,420) (3,500) - 

Purchase of investments in subsidiaries - - (20,000) (1,500) 

Purchase of investments in other 

financial assets (17,018) - (17,018) - 

Deposit on investment (9,321) (52,891) (9,321) (57,891) 

Purchase of property, plant and equipment (166,319) (40,094) - - 

Purchase of intangible assets (4,046) (4,749) - - 

Proceeds from disposal of property, plant 

and equipment 19,152 3,821 - - 

Proceeds from disposal of investments - 21,411 13,700 21,413 

Loans refunded by group companies 1,400 - 17,400 456 

Loans granted to group companies - (7,500) (7,000) (23,500) 

Interest received 1,074 989 1,728 1,015 

Acquisition of subsidiaries net of cash (32,510) - - - 

Disposal of subsidiaries net of cash 14,647 - - - 

Net cash used in investing activities (197,304) (80,433) (24,011) (60,007) 

Cash flows from financing activities 

Interest paid (74,155) (28,905) (17,562) (11,643) 

Refund of long term borrowings (425,385) (70,523) (90,114) (13,372) 

Loans received from group companies 135,000 - - - 

Loans repaid to group companies (11,500) (16,500) (11,500) (16,500) 

Proceeds from long term borrowings 646,171 72,000 179,600 70,000 

Issues of shares by subsidiaries to 

non-controlling interests 10,000 - - - 

Finance lease principal payments (33,751) (13,391) - - 

Dividends paid (23,338) (20,421) (23,338) (20,421) 

Dividends paid by subsidiaries to non-controlling 

shareholders (9,750) (3) - - 

Net cash generated from/(used in) 

financing activities 213,292 (77,743) 37,086 8,064 

Net increase/(decrease) in cash and 

cash equivalents 99,501 (77,593) 33,975 (17,035) 

Movement in cash and cash equivalents 

At July 1, (188,414) (110,821) (62,371) (45,336) 

Increase/(decrease) 99,501 (77,593) 33,975 (17,035) 

At June 30, 30(b) (88,913) (188,414) (28,396) (62,371) 





69

Notes to the Financial Statements 


1 GENERAL INFORMATION 

ENL Commercial Limited is a limited liability company incorporated and domiciled in Mauritius. 

The holding company is ENL Limited. Both companies are incorporated in Mauritius and their registered 

office is at 7th Floor, Swan Group Centre, 10 Intendance Street, Port Louis. 

The ultimate holding entity is Société Caredas, a ‘société civile’ registered in Mauritius. 

These financial statements will be submitted for consideration and approval at the forthcoming annual 

meeting of the shareholders of the company. 

2 SIGNIFICANT ACCOUNTING POLICIES 

The principal accounting policies adopted in the preparation of these financial statements are 

set out below. These policies have been consistently applied to all the years presented unless 

otherwise stated. 

(a) 

Basis of preparation 

The financial statements of ENL Commercial Limited comply with the Companies Act 2001 and have 

been prepared in accordance with International Financial Reporting Standards (IFRS). Where necessary, 

comparative figures have been amended to conform with changes in presentation for the current year. 

The financial statements include the consolidated financial statements of the holding company and its 

subsidiaries (the group) and the separate financial statements of the holding company (the company). 

The financial statements have been prepared under the historical cost convention, except that: 

(i) certain property, plant and equipment are carried at revalued amounts; and 

(ii) held for trading and available-for-sale securities are stated at their fair values as disclosed in the 

accounting policies hereafter. 

The preparation of financial statements in conformity with IFRS requires the use of certain critical 

accounting estimates. It also requires management to exercise its judgement in the process of applying 

the group’s accounting policies. The areas involving a higher degree of judgement or complexity, or 

areas where assumptions and estimates are significant to the financial statements, are disclosed in 

note 4. 

Standards, Amendments to published Standards and Interpretations effective in the reporting 

period 

Amendments to IFRS 1, ‘Additional Exemptions for First-time Adopters’, exempt entities that use the 

full cost method for oil and gas properties from retrospective application of IFRSs. It also exempts 

entities with existing leasing contracts from reassessing the classification of those contracts in 

accordance with IFRIC 4, ‘Determining whether an arrangement contains a lease’. The amendment is 

not expected to have any impact on the group’s financial statements. 

Amendments to IFRS 2, ‘Group Cash-settled Share-based Payment Transactions’. In addition 

to incorporating IFRIC 8, ‘Scope of IFRS 2’, and IFRIC 11, ‘IFRS 2 – Group and treasury share 

transactions’, the amendments expand on the guidance in IFRIC 11 to address the classification of 

group arrangements that were not covered by that interpretation. This amendment is not expected to 

have any impact on the group’s financial statements. 

Amendment to IAS 32, ‘ Classification of rights issues’, addresses the accounting for rights issues 

that are denominated in a currency other than the functional currency of the issuer. Provided certain 

conditions are met, such rights issues are now classified as equity regardless of the currency in which 

the exercise price is denominated. Previously, these issues had to be accounted for as derivative 

liabilities. This amendment is not expected to have any impact on the group’s financial statements. 

Amendment to IFRS 1 Limited Exemption from Comparatives IFRS 7 Disclosures for First-time 

Adopters provides first-time adopters relief from presenting comparative information for the new 

disclosures required by the March 2009 amendments to IFRS 7 ‘Financial Instruments: Disclosures’. 

This amendment is not expected to have any impact on the group’s financial statements. 

70 





(a) 

Basis of preparation (continued) 

Standards, Amendments to published Standards and Interpretations effective in the reporting 

period (continued) 

IFRIC 19, ‘Extinguishing financial liabilities with equity instruments’, clarifies the accounting by an 

entity when the terms of a financial liability are renegotiated and result in the entity issuing equity 

instruments to a creditor of the entity to extinguish all or part of the financial liability (debt for equity 

swap). It requires a gain or loss to be recognised in profit or loss, which is measured as the difference 

between the carrying amount of the financial liability and the fair value of the equity instruments issued. 

If the fair value of the equity instruments issued cannot be reliably measured, the equity instruments 

should be measured to reflect the fair value of the financial liability extinguished. This IFRIC will not 


Improvements to IFRSs (issued 16 April 2009) 

IAS 1 (Amendment), ‘Presentation of Financial Statements’ clarifies that the potential settlement of a 

liability by the issue of equity is not relevant to its classification as current or non-current. By amending 

the definition of current liability, the amendment permits a liability to be classified as non-current 

(provided that the entity has an unconditional right to defer settlement by transfer of cash or other 

assets for at least 12 months after the accounting period) notwithstanding the fact that the entity could 

be required by the counterparty to settle in shares at any time. This amendment is not expected to 


IAS 7 (Amendment), ‘Statement of Cash Flows’, clarifies that only expenditure that results in 

a recognised asset on the statement of financial position can be classified as a cash flow from investing 

activities. 

IAS 17 (Amendment) ‘Leases’, clarifies that when a lease includes both land and buildings, classification 

as a finance or operating lease is performed separately in accordance with IAS 17’s general principles. 

Prior to the amendment, IAS 17 generally required a lease of land with an indefinite useful life to 

be classified as an operating lease, unless title passed at the end of the lease term. A lease newly 

classified as a finance lease should be recognised retrospectively. 

IAS 18 (Amendment), ‘Revenue’. An additional paragraph has been added to the appendix to IAS 18, 

providing guidance on whether an entity is acting as principal or agent. 

IAS 36 (Amendment), ‘Impairment of Assets’, clarifies that for the purpose of impairment testing, the 

cash-generating unit or groups of cash-generating units to which goodwill is allocated should not be 

larger than an operating segment (as defined by IFRS 8, ‘Operating segments’) before aggregation. 

IAS 38 (Amendment), ‘Intangible Assets’, clarifies guidance in measuring the fair value of an intangible 

asset acquired in a business combination and it permits the grouping of intangible assets as a single 

asset if each asset has similar useful economic lives. The amendment removes the exceptions from 

recognising intangible assets on the basis that their fair values cannot be reliably measured. Intangible 

assets acquired in a business combination that are separable or arise from contractual or other legal 

rights should be recognised. The amendment specifies different valuation techniques that may be 

used to value intangible assets where there is no active market. 

IAS 39 (Amendment), ‘Financial Instruments: Recognition and Measurement’ clarifies that the scope 

exemption within IAS 39 only applies to forward contracts that will result in a business combination 

at a future date, as long as the term of the forward contract does ‘not exceed a reasonable period 

normally necessary to obtain any required approvals and to complete the transaction’. The amendment 

removes reference to transactions between segments as being hedgeable transactions in individual 

or separate financial statements and clarifies that amounts deferred in equity are only reclassified 

to profit or loss when the underlying hedged cash flows affect profit or loss. The amendment is not 

expected to have an impact on the group’s statement of comprehensive income. 

IFRS 5 (Amendment), ‘Non-current Assets Held for Sale and Discontinued Operations’. The 

amendment clarifies that IFRS 5 specifies the disclosures required in respect of non-current assets 

(or disposal groups) classified as held for sale or discontinued operations. It also clarifies that the 

general requirement of IAS 1 still apply, in particular paragraph 15 (to achieve a fair presentation) and 

paragraph 125 (sources of estimation uncertainty) of IAS 1. 

IFRS 8 (Amendment), ‘Operating Segments’, clarifies that the requirement for disclosing a measure 

of segment assets is only required when the chief operating decision maker reviews that information. 



71



2 SIGNIFICANT ACCOUNTING POLICIES (continued) 

(a) 

Basis of preparation (continued) 

Improvements to IFRSs (issued 6 May 2010) 

IFRS 3 (Amendment), ‘Business Combinations’, clarifies that the choice of measuring non-controlling 

interests at fair value or at the proportionate share of the acquiree’s net assets applies only to instruments 

that represent present ownership interests and entitle their holders to a proportionate share of the net 

assets in the event of liquidation. All other components of non-controlling interest are measured at 

fair value unless another measurement basis is required by IFRS. The application guidance in IFRS 

3 applies to all share-based payment transactions that are part of a business combination, including 

un-replaced and voluntarily replaced share-based payment awards. 

IAS 27 (Amendment), ‘Consolidated and Separate Financial Statements’, clarifies that the consequential 

amendments to IAS 21, IAS 28 and IAS 31 resulting from the 2008 revisions to IAS 27 are to be applied 

prospectively. 

Standards, Amendments to published Standards and Interpretations issued but not yet effective 

Certain standards, amendments to published standards and interpretations have been issued that are 

mandatory for accounting periods beginning on or after 1 January 2011 or later periods, but which the 

group has not early adopted. 

At the reporting date of these financial statements, the following were in issue but not yet effective: 

Amendments to IFRIC 14 Prepayments of a Minimum Funding Requirement 

IAS 24 Related Party Disclosures (Revised 2009) 

Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters (Amendments to IFRS1) 

Deferred Tax: Recovery of Underlying Assets (Amendments to IAS 12) 

Disclosures – Transfers of Financial Assets (Amendments to IFRS 7) 

Amendments to IAS 1 Presentation of Items of Other Comprehensive Income 

IFRS 9 Financial Instruments 

IAS 27 Separate Financial Statements 

IAS 28 Investments in Associates and Joint Ventures 

IFRS 10 Consolidated Financial Statements 

IFRS 11 Joint Arrangements 

IFRS 12 Disclosure of Interests in Other Entities 

IFRS 13 Fair Value Measurement 

IAS 19 Employee Benefits (Revised 2011) 

Improvements to IFRSs (issued 6 May 2010) 

IFRS 1 First-time Adoption of International Financial Reporting Standards 

IFRS 7 Financial Instruments: Disclosures 

IAS 1 Presentation of Financial Statements 

IAS 34 Interim Financial Reporting 

IFRIC 13 Customer Loyalty Programmes 

Where relevant, the group is still evaluating the effect of these standards, amendments to published 

standards and interpretations, issued but not yet effective, on the presentation of its financial 

statements. 

(b) Investments in subsidiary companies 

Separate financial statements of the investor 

Investments in subsidiary companies are carried at fair values. The carrying amount is reduced to 

recognise any impairment in the value of individual investments. 

72 





(b) Investments in subsidiary companies (continued) 

Consolidated financial statements 

Subsidiaries are all entities (including special purpose entities) over which the group has the power 

to govern the financial and operating policies generally accompanying a shareholding of more than 

one half of the voting rights. The existence and effect of potential voting rights that are currently 

exercisable or convertible are considered when assessing whether the group controls another entity. 

Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are 

de-consolidated from the date that control ceases. 

The acquisition method of accounting is used to account for business combinations by the group. The 

consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, 

the liabilities incurred and the equity interests issued by the group. The consideration transferred 

includes the fair value of any asset or liability resulting from a contingent consideration arrangement. 

Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and 

contingent liabilities assumed in a business combination are measured initially at their fair values at 

the acquisition date. On an acquisition-by-acquisition basis, the group recognises any non-controlling 

interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the 

acquiree’s net assets. Subsequent to acquisition, the carrying amount of non-controlling interests is the 

amount of those interests at initial recognition plus the non-controlling interests’ share of subsequent 

changes in equity. Total comprehensive income is attributed to non-controlling interests even if this 

results in the non-controlling interests having a deficit balance. 

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree 

and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of 

the group’s share of the identifiable net assets acquired is recorded as goodwill. If this is less than the 

fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference 

is recognised directly on the statement of comprehensive income. 

Inter-company transactions, balances and unrealised gains and losses on transactions between 

group companies are eliminated. The accounting policies of subsidiaries have been amended where 

necessary to ensure consistency with the policies adopted by the group. 

Transactions and non-controlling interests 

The group accounts for transactions with non-controlling interests as transactions with equity owners 

of the group. For purchases from non-controlling interests, the difference between any consideration 

paid and the relevant share of the carrying value of net assets of the subsidiary acquired is recorded in 

equity. Gains or losses on disposals to non-controlling interests are also recorded in equity. 

When the group ceases to have control or significant influence, any retained interests in the entity 

is remeasured to its fair value, with the change in carrying amount recognised in profit or loss. The 

fair value is the initial carrying amount for the purposes of subsequently accounting for the retained 

interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised 

in other comprehensive income in respect of that entity are accounted for as if the group had directly 

disposed of the related assets or liabilities. This may mean that amounts previously recognised in 

other comprehensive income are reclassified to profit and loss. 

(c) 

Investments in associates 

Separate financial statements of the investor 

Investments in associated companies are carried at fair values. The carrying amount is reduced to 

recognise any impairment in the value of individual investments. 

Consolidated financial statements 

An associate is an entity over which the group has significant influence but not control, or joint control. 

Investments in associates are accounted for under the equity method. 

The group’s investments in associates include goodwill (net of any accumulated impairment loss) 

identified on acquisition. Investments in associates are initially recognised at cost as adjusted by post 

acquisition changes in the group’s share of the net assets of the associates less any impairment in the 

value of individual investments. 

When the group’s share of losses exceeds its interest in an associate, the group discontinues 

recognising further losses, unless it has incurred legal or constructive obligation or made payments 

on behalf of the associate. 



73




(c) 

Investments in associates (continued) 

Consolidated financial statements (continued) 

The results of associated companies acquired or disposed of during the year are included on the 

consolidated statement of comprehensive income from the date of their acquisition or up to the date 

of their disposal. 

Unrealised profits and losses are eliminated to the extent of the group’s interests in the associate. 

Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of 

the assets transferred. 

Where necessary, appropriate adjustments are made to the financial statements of associates to bring 

the accounting policies used in line with those adopted by the group. 

If the ownership in an associate is reduced but significant influence is retained, only a proportionate 

share of the amounts previously recognised in other comprehensive income are reclassified to profit 

or loss where appropriate. 

(d) Property, plant and equipment 

All property, plant and equipment are initially recorded at cost, some of which are subsequently shown 

at revalued amount, less subsequent depreciation. All other property, plant and equipment are stated 

at historical cost less depreciation. Historical cost includes expenditure that is directly attributable 

to the acquisition of the items. Subsequent costs are included in the assets’ carrying amount or 

recognised as a separate asset as appropriate, only when it is probable that future economic benefits 

associated with the item will flow to the group and the cost can be measured reliably. 

Increases in the carrying amount arising on revaluation are credited to revaluation surplus in shareholders’ 

equity. Decreases that offset previous increases of the same asset are charged against the revaluation 

surplus directly in equity. All other decreases are charged to the statement of comprehensive income. 

Depreciation is calculated on a straight line method to write off the cost or revalued amounts of the 

assets, with the exception of land, to their residual values over their estimated useful lives as follows: 

Years 

Buildings 10 - 50 

Plant and equipment 5 - 10 

Motor vehicles 7 - 10 

Furniture and fittings 5 - 20 

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of 

each reporting period. 

When the carrying amount of an asset is greater than its estimated recoverable amount, it is written 

down immediately to its recoverable amount. 

Gains and losses on disposals of property, plant and equipment are determined by comparing 

proceeds with carrying amount and are included on the statement of comprehensive income. 

On disposal of revalued assets, amounts in revaluation surplus relating to that asset are transferred to 

retained earnings. 

(e) 

(i) 

Intangible assets 

Goodwill 

Goodwill represents the excess of cost of acquisition over the group’s interests in the fair value of 

the net identifiable assets of the acquired subsidiary or associated entity at the date of acquisition. 

Goodwill on acquisition of associates is included in investments in associates. Any net excess of the 

group’s interests in the net fair value of the acquiree’s net identifiable assets over cost is recognised 

on the statement of comprehensive income. 

Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. 

On disposal of a subsidiary company or associated company, the attributable amount of goodwill is 

included in the determination of the gains and losses on disposal. 

Goodwill is allocated to cash-generating units for the purpose of impairment testing. 

74 





(e) 

(ii) 

Intangible assets (continued) 

Computer software 

Computer software is capitalised on the basis of costs incurred to acquire and bring to use the specific 

software and is amortised over its estimated useful life of 4 years. 

(f) 

Finance lease 

Leases are classified as finance lease where the terms of the lease transfer substantially all risks and 

rewards of ownership to the lessee. 

Finance leases are capitalised at the estimated present value of the underlying lease payments. Each 

lease payment is allocated between the liability and finance charges so as to achieve a constant rate 

on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are 

included in borrowings. 

Finance charges are charged to the statement of comprehensive income over the lease period. Plant 

and equipment acquired under finance leasing contracts are depreciated over the useful lives of the 

assets. 

(g) 

Inventories 

Inventories and work in progress are valued at the lower of cost and net realisable value. Cost is 

determined on a weighted average basis. The cost of finished goods and work in progress comprises 

raw materials, direct labour, other direct costs and related production overheads but excludes interest 

expense. Net realisable value is the estimate of the selling price in the ordinary course of business less 

the costs of completion and applicable variable selling expenses. 

(h) Deferred income taxes 

Deferred income tax is provided in full, using the liability method, for all temporary differences arising 

between the tax bases of assets and liabilities and their carrying values in the financial statements. 

Deferred income tax is determined using tax rates that have been enacted by the end of the reporting 

period and are expected to apply in the period when the related deferred income tax asset is realised 

or the deferred income tax liability is settled. 

Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be 

available against which deductible temporary differences can be utilised. 

(i) 

Foreign currencies 

Functional and presentation currency 

Items included in the financial statements of each of the group’s entities are measured using Mauritian 

rupees, the currency of the primary economic environment in which the entities operate (“functional 

currency”). The consolidated financial statements are presented in Mauritian rupees, the group’s 

functional and presentation currency. 

Transactions and balances 

Foreign currency transactions are translated into the functional currency using the exchange rates 

prevailing at the date of the transactions. Gains and losses, resulting from the settlement of such 

transactions and from the translation of monetary assets and liabilities denominated in foreign 

currencies, are recognised on the statement of comprehensive income. Such balances are translated 

at year-end exchange rates unless hedged by forward foreign exchange contracts, in which case the 

rates specified in such forward contracts are used. 

On consolidation, the assets and liabilities of the group’s overseas entities are translated at exchange 

rates prevailing at the end of the reporting period. Income and expense items are translated at the average 

exchange rates for the period. Exchange differences, if any, are classified as other comprehensive 

income. Such translation differences are recognised on the statement of comprehensive income in the 

period in which the operation is disposed of. 



75




(j) 

Retirement benefit obligations 

Defined benefit plans 

A defined benefit plan is a pension plan that defines an amount of pension benefit that an employee 

will receive on retirement, usually dependant on one or more factors such as age, years of service 

and compensation. Some subsidiaries of the group contribute to a defined benefit plan for certain 

employees. The cost of providing benefits is determined using the projected unit credit method 

so as to spread the regular cost over the service lives of employees in accordance with the advice 

of actuaries. 

Cumulative actuarial gains and losses arising from experienced adjustments, changes in actuarial 

assumptions and amendments to pension plans in excess of the greater of 10 % of the value of the 

plan assets or 10% of the defined benefit obligations are spread to income over the remaining lives of 

the related employees. 

Defined contribution plans 

A defined contribution plan is a pension plan under which a company pays fixed contributions into a 

separate entity. Some subsidiaries operate a defined contribution plan for all qualifying employees. 

Payments to defined contribution plans are charged as expense as they fall due. 

Retirement gratuity 

For employees who are not covered under a pension plan, the net present value of retirement gratuities 

payable under the Employment Rights Act 2008 is calculated by actuaries and provided for. The 

obligations arising under this item are not funded. 

Cumulative actuarial gains and losses arising from experienced adjustments, changes in actuarial 

assumptions and the greater of 10% of the retirement obligation are spread to income over the 

remaining lives of the related employees. 

Profit-sharing 

Certain subsidiary companies recognise a liability and an expense for bonuses and profit-sharing. The 

subsidiary companies recognise a provision when a contractual obligation has arisen. 

(k) 

Impairment of assets 

Assets that have an indefinite useful life are not subject to amortisation and are tested annually for 

impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or 

changes in circumstances indicate that the carrying amount may not be recoverable. An impairment 

loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable 

amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in 

use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there 

are separately identifiable cash flows (cash-generating units). 

(l) Revenue recognition 

Turnover for the group is based on the invoiced value (net of value added taxes) of all sales of goods 

and services less discounts, allowances and returns and after eliminating intra-group sales. 

Turnover also includes interest and dividend receivable which are recognised on the following bases: 

• Interest income is taken to the statement of comprehensive income on a time proportion basis using 

the effective interest method. When a receivable is impaired, the group reduces the carrying amount 

to its recoverable amount. 

• Dividend income is accounted for when the shareholder’s right to receive payment is established. 

(m) Dividend distribution 

Dividend distribution to the company’s shareholders is recognised as a liability in the group’s financial 

statements in the period in which the dividends are declared. 

76 





(n) Non-current assets classified as held for sale 

Non-current assets held for sale relate to investments which will be sold in the next financial year and 

are measured at the lower of carrying amount and fair value less costs to sell. 

(o) 

Financial instruments 

(i) Categories of financial assets 

The group classifies its financial assets in the following categories: held for trading and available-for-sale 

financial assets. 

The classification depends on the purpose for which the investments were acquired. Management 

determines the classification of its investments at initial recognition and re-evaluates this designation at 

every reporting date. 

The group’s accounting policies in respect of the main financial instruments are set out below. 

Initial measurement 

Purchases and sales of financial assets are recognised on trade-date, the date on which the group 

commits to purchase or sell the asset. Investments are initially measured at cost inclusive of transaction 

costs. 

Derecognition 

Financial assets are derecognised when the rights to receive cash flows from the investments have 

expired or have been transferred and the group has transferred substantially all risks and rewards of 

ownership. 

Subsequent measurement 

Financial assets are subsequently carried at their fair values. 

The fair values of some quoted investments are based on current bid prices. If the market for the financial 

asset is not active (and for unlisted securities), the group establishes fair value by using valuation 

techniques. These include the use of recent arm’s length transactions, reference to other instruments 

that are substantially the same, adjusted net asset value, capitalised earnings method, dividend yield 

method and market prices refined to reflect the issuer’s specific circumstances. 

Investments in equity instruments that do not have a quoted market price in an active market and whose 

fair value cannot be reliably measured are reflected at cost. 

Available-for-sale financial assets 

Available-for-sale financial assets are non-derivative financial assets that are either designated in this 

category or not classified in any of the other categories. They are included in non-current assets unless 

management intends to dispose of the investment within twelve months of the end of the reporting 

period. 

Unrealised gains and losses arising from changes in the fair value of financial assets classified as 

available-for-sale are recognised in other comprehensive income. When financial assets classified as 

available-for-sale are sold or impaired, the accumulated fair value adjustments are included on the 

statement of comprehensive income as gains and losses. 

Held for trading financial assets 

A financial asset is classified in this category if acquired principally for the purpose of selling in the short 

term or if so designated by management. Assets in this category are classified as current assets. 

Realised and unrealised gains and losses arising from changes in the fair value of financial assets 

classified as available-for sale are recognised in other comprehensive income. 

Realised and unrealised gains and losses arising from changes in the fair value of held for trading financial 

assets are included in the statement of comprehensive income. 

Impairment of financial assets 

The group assesses at the end of each reporting period whether there is objective evidence that a 

financial asset or a group of financial assets is impaired. In the case of financial assets classified as 

available-for-sale, a significant or prolonged decline in the fair value of the security below its cost is 

considered in determining whether the securities are impaired. If any such evidence exists for availablefor-sale 

financial assets, the cumulative loss-measured as the difference between acquisition cost and 

the current fair value, less any impairment loss on that financial asset previously recognised in profit or 

loss - is removed from equity and recognised on the statement of comprehensive income. 



77




(o) 

Financial instruments (continued) 

(ii) Trade and loan receivables 

Trade and loan receivables are recognised initially at fair value and subsequently measured at amortised 

cost using the effective interest method less provision for impairment. A provision for impairment of trade 

receivables is established when there is objective evidence that the group will not be able to collect all 

amounts due according to the original terms of receivables. The amount of provision is recognised on 

the statement of comprehensive income. 

(iii) Trade payables 

Trade payables are stated at fair value and subsequently measured at amortised cost using the effective 

interest method. 

(iv) Equity instruments 

Equity instruments are recorded net of direct issue costs. 

(v) Borrowings 

Borrowings are recognised net of direct issue costs. 

Borrowings are classified as current liabilities unless the group has an unconditional right to defer 

settlement of the liability for at least twelve months after the end of the reporting period. 

(vi) Share capital 

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new share 

are shown in equity as deduction from proceeds. 

(vii) Cash and cash equivalents 

Cash and cash equivalents include cash in hand and bank overdrafts. Bank overdrafts are shown within 

borrowings in current liabilities on the statement of financial position. 

(p) 

Segment reporting 

Segment information presented relates to operating segments that engage in business activities for 

which revenues are earned and expenses incurred. 

(q) 

Deferred income 

Grant received from Government in respect of capital expenditure are treated as deferred revenue. These 

are credited to the statements of comprehensive income by instalments over the expected lives of the 

related assets. 

(r) 

Provisions 

Provisions are recognised when the group has a present legal or constructive obligation as a result of 

past events, which will probably result in an outflow of economic benefits that can be reliably estimated. 

3 FINANCIAL RISK MANAGEMENT 

3.1 Financial risk factors 

The group’s activities expose it to a variety of financial risks, including: 

• Market risk (including currency risk, price risk and cash flow and fair value interest risk); 

• Credit risk; and 

• Liquidity risk 

The group’s overall risk management programme focuses on the unpredictability of financial markets 

and seeks to minimise potential adverse effects on the group’s financial performance. 

A description of the significant risk factors is given below together with the risk management policies 

applicable. 

78 





(a) 

Market Risk 

(i) Currency risk 

Several of the company’s subsidiaries deal in foreign currency transactions and are exposed to foreign 

exchange risk arising from various currency exposures, primarily with respect to the Euro, the US dollar, 

Japanese Yen and South African Rands (ZAR). Foreign exchange risk arises from future commercial 

transactions and recognised assets and liabilities. 

The group 

At June 30, 2011, if the Rupee had weakened/strengthened by 5% against the ZAR/US dollar/Euro 

with all other variables held constant, post-tax profit for the year would have been Rs 6,295,861 (2010: 

Rs.599, 040) higher/ lower, mainly as a result of foreign exchange gains/losses on translation of US 

dollar/Euro denominated trade receivables, trade payables and borrowings. 

(ii) Price risk 

The group is exposed to equity securities price risk because of investments held by the group and 

classified on the consolidated statement of financial position as investments in financial assets. 

To manage its price risk arising from investments in equity securities, the group diversifies its portfolio. 

Diversification of the portfolio is done in accordance with the limits set by the group. 

Sensitivity analysis 

The table below summarises the impact of increases/decreases in the fair value of the investments on 

the group’s profit and equity. The analysis is based on the assumption that the fair value had increased/ 

decreased by 5%. 

THE GROUP AND THE COMPANY 

Impact on 

Impact on other 

profit comprehensive income 

2011 2010 2011 2010 

Rs’000 Rs’000 Rs’000 Rs’000 

Available-for-sale investments in 

financial assets - - 41,150 6,791 

Held for trading securities 423 - - - 

(iii) Cash flow and fair value interest risk 

The group’s interest rate risk arises from long term borrowings. 

At June 30, 2011, if interest rates on borrowings had been 50 basis points higher/lower with all other 

variables held constant, post-tax profit for the year would have been lower/higher mainly as a result of 

higher/lower interest expense on floating rate borrowings as shown below: 

Rupee-denominated borrowings 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Effect higher/lower interest expense on 

post tax profit 1,403 975 103 44 

(b) 

Credit Risk 

Credit risk is the risk that an issuer or counterparty will be unable or unwilling to meet a commitment that 

it has entered into with the group. The company’s credit risk concentration is spread between interest rate 

and equity securities. All transactions in listed securities are settled/paid for upon delivery using approved 

brokers. The risk of default is considered minimal since delivery of securities sold is only made once the 

broker has received payment. On a purchase, payment is made once the securities have been received 

by the broker. If either party fails to meet their obligations, the trade will fail. 

The subsidiaries’ credit risk is primarily attributable to their trade receivables. The amounts presented on 

the statement of financial position are net of allowances for doubtful receivables, estimated by the group’s 

management based on prior experience and current economic environment. The subsidiaries have no 

significant concentration of credit risk, with exposure spread over a large number of counterparties and 

customers. 



79



FINANCIAL RISK MANAGEMENT (continued) 

3.1 Financial risk factors (continued) 

(c) 

Liquidity Risk 

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and 

the availability of funding through an adequate amount of committed credit facilities. The group aims at 

maintaining flexibility in funding by keeping committed credit lines available. 

Management monitors rolling forecasts of the group’s liquidity reserve on the basis of expected cash 

flows. 

The group’s financial liabilities analysed into relevant maturity groupings based on the remaining period 

at the end of the reporting period to the contractual maturity date has been disclosed in note 17. All trade 

and other payables are due within one year. 

3.2 Fair value estimation 

The fair value of financial instruments traded on active markets is based on quoted market prices at 

the end of the reporting period. A market is regarded as active if quoted prices are readily and regularly 

available from an exchange, dealer, broker or regulatory agency and those prices represent actual and 

regularly occurring market transactions on an arm’s length basis. These instruments are included in level 

1. Instruments included in level 1 comprise primarily quoted equity investments classified as trading 

securities or available for sale. 

The fair value of financial instruments that are not traded on an active market is determined using 

valuation techniques. The group uses a variety of methods namely capitalised earnings, net asset basis 

and dividend yield where applicable and makes assumptions that are based on market conditions 

existing at the end of each reporting period. These instruments are included in level 3. 

If all significant inputs required to fair value an instrument are observable, the instrument is included in 

level 2. 

The nominal value less estimated credit adjustments of trade receivables and payables are assumed to 

approximate their fair values. 

The carrying amount of the group’s financial assets would be an estimated Rs 187,800 for the group and 

for the company (2010: Rs.34.72m) lower/ higher in the event their fair values were increased/decreased 

by 5%. 

The fair value of those financial assets and liabilities not presented on the group’s statements of financial 

position at their fair values are not materially different from their carrying amounts. 

3.3 Capital risk management 

The group’s objectives when managing capital are: 

• to safeguard the entities’ ability to continue as going concerns so that they can continue to provide 

returns for shareholders and benefits for other stakeholders; and 

• to provide an adequate return to shareholders by pricing products and services commensurately with 

the level of risk. 

The group manages the capital structure and makes adjustments to it in the light of changes in economic 

conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the 

capital structure, the group may adjust the amount of dividends paid to shareholders or sell assets to 

reduce debt. 

The group monitors capital on the basis of the debt-to-adjusted capital ratio. This ratio is calculated as 

net debt adjusted capital. Net debt is calculated as total debt (as shown on the statement of financial 

position) less cash and bank balances. Adjusted capital comprises all components of equity (i.e. 

share capital, share premium, non-controlling interests, retained earnings and revaluation, fair value and 

other reserves). 

80 





3.3 Capital risk management (continued) 

The net debt-to-adjusted capital ratios at June 30, 2011 and at June 30, 2010 were as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Total debt 764,191 470,721 234,719 179,578 

Less: cash and bank balances (47,325) (11,189) (119) (489) 

Net debt 716,866 459,532 234,600 179,089 

Total equity 1,068,510 1,104,528 1,369,762 1,478,419 

Debt-to-adjusted capital ratio 0.67 0.42 0.17 0.12 

4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS 

Estimates and judgements are continuously evaluated and are based on historical experience and 

other factors, including expectations of future events that are believed to be reasonable under the 

circumstances. 

4.1 Critical accounting estimates and assumptions 

The group makes estimates and assumptions concerning the future. The resulting accounting estimates 

will, by definition, seldom equal the related actual results. The estimates and assumptions that have a 

significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within 

the next financial year are discussed below. 

(a) 

(b) 

(c) 

(d) 

Estimated impairment of goodwill 

The group tests annually whether goodwill has suffered any impairment in accordance with the 

accounting policy stated in Note2 (e) (i). These calculations require the use of estimates. 

Impairment of available-for-sale financial assets 

The group follows the guidance of IAS 39 on determining when an investment is other-than-temporarily 

impaired. This determination requires significant judgement. In making this judgement the group 

evaluates, among other factors, the duration and extent to which the fair value of an investment is 

less than its cost and the financial health of and near-term business outlook for the investee, including 

factors such as industry and sector performance, changes in technology and operational and financing 

cash flows. 

Pension benefits 

The present value of the pension obligations depend on a number of factors that are determined on 

an actuarial basis using a number of assumptions. The assumptions used in determining the net cost/ 

(income) for pensions include the discount rate. Any changes in these assumptions will impact the 

carrying amount of pension obligations. 

The group determines the appropriate discount rate at the end of each year. This is the interest rate 

used to determine the present value of estimated future cash outflows expected to be required to settle 

the pension obligations. In determining the appropriate discount rate, the group considers the interest 

rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be 

paid and that have terms to maturity approximating the terms of the related pension liability. 

Revaluation of plant, property and equipment 

The group measures land and buildings at revalued amounts with changes in fair value being recognised 

in other comprehensive income. The group appointed independent valuation specialists to determine 

fair value of property as at 30 June 2011. Valuation was made on the basis of open market value. 



81



4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued) 

4.1 Critical accounting estimates and assumptions (continued) 

(e) 

(f) 

(g) 

Asset lives and residual values 

Property, plant and equipment are depreciated over their useful lives taking into account residual 

values, where appropriate. The actual lives of the assets and residual values are assessed annually and 

may vary depending on a number of factors. In reassessing asset lives, factors such as technological 

innovation, product life cycles and maintenance programmes are taken into account. Residual value 

assessments consider issues such as future market conditions, the remaining life of the asset and 

projected disposal values. Consideration is also given to the extent of current profits and losses on the 

disposal of similar assets. 

The directors, therefore, make estimates based on historical experience and use best judgement to 

assess the useful lives of assets and to forecast the expected residual values of the assets at the end 

of their expected useful lives. 

Depreciation policies 

Property, plant and equipment are depreciated to their residual values over their estimated useful lives. 

The residual value of an asset is the estimated net amount that the group would currently obtain from 

disposal of the asset, if the asset were already of the age and in condition expected at the end of its 

useful life. 

The directors therefore make estimates based on historical experience and use best judgement to 

assess the useful lives of assets and to forecast the expected residual values of the assets at the end 

of their expected useful lives. 

Fair value of securities not quoted on an active market 

The fair value of securities not quoted on an active market is determined by the group using valuation 

techniques. These valuation methods involve the use of judgement and estimates. Changes in 

assumptions about these factors could affect the reported fair value of investments. 

82 





5 PROPERTY, PLANT AND EQUIPMENT 

THE GROUP 

(i) 2011 

Freehold Plant & Motor Furniture, 

land Buildings equipment vehicles fittings Total 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Cost and Valuation 

At July 1, 2010 152,750 148,770 108,898 126,217 41,314 577,949 

Additions - 11,790 12,129 37,010 12,430 73,359 

Acquisition through business 

combination 50,750 134,155 173,803 36,424 14,719 409,851 

Adjustment arising on disposal 

of subsidiary (7,500) (1,950) (640) - (180) (10,270) 

Disposals - (1,427) (1,082) (42,440) (252) (45,201) 

Write offs - (51) - - - (51) 

Revaluation adjustments 19,271 50,237 - - - 69,508 

At June 30, 2011 215,271 341,524 293,108 157,211 68,031 1,075,145 

Depreciation 

At July 1, 2010 - 5,850 73,987 64,820 30,497 175,154 

Charge for the year - 12,621 21,945 30,112 8,009 72,687 

Acquisition through business 

combination - 91,436 123,965 22,835 9,514 247,750 

Adjustment arising on disposal 

of subsidiary - (516) (640) - (180) (1,336) 

Disposals adjustments - (1,043) (871) (30,819) (109) (32,842) 

Revaluation adjustments - (8,751) - - - (8,751) 

At June 30, 2011 - 99,597 218,386 86,948 47,731 452,662 

Net Book Values 

At June 30, 2011 215,271 241,927 74,722 70,263 20,300 622,483 



83



5 PROPERTY, PLANT AND EQUIPMENT 

THE GROUP 

(b) 2010 

Freehold Plant & Motor Furniture, 

land Buildings equipment vehicles fittings Total 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Cost and Valuation 

At July 1, 2009 83,471 84,587 101,939 117,002 35,979 422,978 

Additions 69,279 66,400 7,388 21,069 5,670 169,806 

Write offs - (2,201) (409) - - (2,610) 

Disposals - (16) (20) (11,854) (335) (12,225) 

At June 30, 2010 152,750 148,770 108,898 126,217 41,314 577,949 

Depreciation 

At July 1, 2009 - 3,226 67,123 50,530 25,059 145,938 

Charge for the year - 4,534 6,880 24,356 5,602 41,372 

Write offs - (1,894) - - - (1,894) 

Disposals adjustments - (16) (16) (10,066) (164) (10,262) 

At June 30, 2010 - 5,850 73,987 64,820 30,497 175,154 


At June 30, 2010 152,750 142,920 34,911 61,397 10,817 402,795 

(c) 

(d) 

Additions include Rs.20m (2010: Rs.5m) of assets leased under finance leases. 

Leased assets included above comprise the following: 

Plant and equipment Motor vehicles Furniture and fittings 

2011 2010 2011 2010 2011 2010 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Cost-capitalised finance leases 64,981 5,110 105,362 65,839 2,651 292 

Accumulated depreciation (26,588) (1,595) (52,246) (30,471) (933) (92) 

Net book values 38,393 3,515 53,116 35,368 1,718 200 

(e) 

(f) 

(g) 

Depreciation charge of Rs.73m (2010: Rs.41m) has been accounted for in other operating expenses. 

The group’s land and buildings were revalued at June 30, 2011 by International Valuers Ltd (Mr. Noor 

Dilmohamed - Certified Practising Valuer). The valuation was made on the basis of open market 

value and 75% of the value has been booked in the financial statements. Plant and equipment were 

revalued in 1995 by Engineering Technical & Management Services Ltd on a going concern basis at 

the depreciated replacement cost. The revaluation surplus net of deferred income taxes was credited 

to revaluation surplus in shareholders’ equity. 

If land and buildings were stated on the historical cost basis, the amounts would be as follows: 


Rs’000 Rs’000 

Land 

Cost 151,329 119,017 

Buildings 

Cost 185,452 140,129 

Accumulated depreciation (47,297) (14,925) 

Net book values 138,155 125,204 

Bank borrowings are secured on some of the property, plant and equipment. 

84 





6 INTANGIBLE ASSETS 

(a) THE GROUP 2011 

Computer 

Goodwill software Total 

Rs’000 Rs’000 Rs’000 

Cost 

At July 1, 2010 17,974 25,515 43,489 

Acquisition through business combination 132,164 5,218 137,382 

Additions - 4,046 4,046 

At June 30, 2011 150,138 34,779 184,917 

Amortisation 

At July 1, 2010 - 16,277 16,277 

Acquisition through business combination - 1,572 1,572 

Charge for the year 796 4,108 4,904 

Impairment charge 37,863 - 37,863 




(b) THE GROUP 2010 

Computer 

Goodwill software Total 

Rs’000 Rs’000 Rs’000 

Cost 

At July 1, 2009 17,974 20,766 38,740 

Additions - 4,749 4,749 

At June 30, 2010 17,974 25,515 43,489 

Amortisation 

At July 1, 2009 - 12,925 12,925 

Charge for the year - 3,352 3,352 

At June 30, 2010 - 16,277 16,277 


At June 30, 2010 17,974 9,238 27,212 

7 INVESTMENTS IN SUBSIDIARY COMPANIES 

THE COMPANY 2011 2010 

Rs’000 Rs’000 

Fair value 

Unquoted 

At July 1, 581,815 511,036 

Additions 20,000 1,500 

Transfer from associated companies 70,345 - 

Transfer from deposit on investment 57,891 - 

Disposal (14,086) - 

Fair value adjustments 87,234 69,279 

At June 30, 803,199 581,815 

(a) 

The fair value of the investments at June 30, 2011 was determined by Ernst & Young. The valuation 

was based on a combination of adjusted net assets, capitalised earnings and recent transaction value. 



85



7 INVESTMENTS IN SUBSIDIARY COMPANIES (continued) 

(b) The subsidiary undertakings which are shown below are segmented as follows: 

Country of 

incorporation/ 2011 2010 

registration Stated Class of Percentage held Percentage held 

Name of corporation & operations Year end Main business capital shares Direct Indirect Direct Indirect 

Rs’000 % % % % 

Investment & management: 

Société Réunion Mauritius June 30, Investment holding 8,620 Parts 100.0 - 100.0 - 

Packestate Limited Mauritius June 30, Rental of industrial buildings 1,278 Ordinary 100.0 - 100.0 - 

Commercial: 

Anthurium & Orchids Limited 

(note (c )) Mauritius June 30, Rental of office and shade houses 7,000 Ordinary - - 100.0 - 

Axess Limited Mauritius June 30, Car dealer 150,000 Ordinary 100.0 - 100.0 - 

Exotiflors Limited (note (c)) Mauritius June 30, Dormant 1,000 Ordinary - - - 100.0 

Charabia Ltd (note (d)) Mauritius June 30, Providing interior decorating services 30 Ordinary 100.00 - - - 

Grewals (Mauritius) Limited Mauritius June 30, Saw milling and timber merchants 74,432 Ordinary 100.00 - 98.96 - 

Grewals Contracting Ltd Mauritius June 30, Joinery contracting 64,099 Ordinary - 100.00 - 98.96 

Grewals Rodrigues Ltd Mauritius June 30, Timber merchant 400 Ordinary 75.0 24.74 75.0 24.74 

Rennel Limited Mauritius June 30, Courier Service 6,000 Ordinary 100.0 - 100.0 - 

Industry: 

Cogir Limitée (note (e)) Mauritius June 30, Construction 11,000 Ordinary 56.00 - 35.00 - 

Emballages Limited (note (f)) Mauritius June 30, Manufacture of stationery 1,109 Ordinary - - 99.77 - 

Pack Plastics Limited Mauritius June 30, Manufacture of plastic products 3,100 Ordinary 99.97 - 99.97 - 


(note (e)) Mauritius June 30, Manufacture of sunglasses 73,202 Ordinary 58.81 - 34.18 - 

(c) Anthuriums & Orchids Limited and Exotiflors Limited were disposed during the year. 

(d) The group acquired 100% of Charabia Ltd during the year. 

(e) Cogir Limitée and Plastinax Austral Limitée, previously associates of the group, are now subsidiaries. 

(f) Emballages Limited was amalgamated with Pack Plastics Limited during the year. 

86 





8 INVESTMENTS IN ASSOCIATES 

(a) THE GROUP 


Rs’000 Rs’000 

At July 1, 22,288 23,679 

Transfer to subsidiaries 5,525 - 

Arising on business combination 8,279 - 

Additions 4,363 4,920 

Movement in share of net assets of associates (4,469) (6,311) 

At June 30, 35,986 22,288 

Made up as follows: 

Share of net assets at June 30, 31,052 15,962 

Goodwill on acquisition 4,934 6,326 

35,986 22,288 

(i) The principal associated companies of the group, which are all unquoted, are shown below: 


Profit/ Profit/ Percentage holding 

Name of company Year end Assets Liabilities Revenues (loss) Assets Liabilities Revenues (loss) 2011 2010 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 % % 

Commercial: 

Alu Systemes Limitée (a) June 30, 43,764 4,235 36,210 3,735 N/A N/A N/A N/A 20.70 20.70 

Docufile Ltd (a) June 30, 3,964 5,291 9,467 81 N/A N/A N/A N/A 35.00 0.00 

Formation Recrutement & Conseil 

en Informatique Limitée June 30, 92,952 78,474 121,979 7,397 66,702 51,792 107,934 

Hyperdist I.O. (b) December 31, 3,776 5,843 29,268 (7,571) 61,244 

6,776 47.14 47.14 

55,676 98,937 (4,511) 45.00 45.00 

Plastinax Austral (Com) Ltd (c) June 30, - - - - - - - - 24.50 24.50 

Superdist Limited (b) December 31, 148,133 110,828 390,148 (11,075) 251,037 202,657 534,821 (2,192) 45.00 45.00 

Interex S.A. (d) June 30, 4,783 2,845 8,263 (1,893) 2,538 2,982 6,874 (3,052) 50.00 50.00 

Industry: 

Cogir Limitée (e) June 30, N/A N/A N/A N/A 326,805 251,657 478,538 15,070 N/A 35.00 

Plastinax Austral Limitée (e) June 30, N/A N/A N/A N/A 167,793 233,665 173,312 (23,819) N/A 34.18 

(a) Alu Systemes Limitée and Docufile Ltd are new associates of ENL Commercial Limited. Alu systemes Limitée is held through Cogir Limitée, now a subsidiary of ENL Commercial Limited. 

(b) For companies with non co-terminous year end, management accounts to June 30 have been included in the consolidated financial statements. 

(c) The company’s figures were included through Plastinax Austral Limitée. 

(d) Investment in Interex S.A is held through the company’s subsidiary, Rennel Limited. 

(e) Cogir Limitée and Plastinax Austral Limitée are subsidiaries of ENL Commercial Limited as from 1 July 2010. 



87



8 INVESTMENTS IN ASSOCIATES (continued) 

(b) 

THE COMPANY 


Rs’000 Rs’000 

Fair value 

At July 1, 160,314 177,765 

Additions 3,500 - 

Transfer to investment in subsidiary companies (70,345) - 

Fair value adjustments (28,306) (17,451) 

At June 30, 65,163 160,314 

(c) 

The fair values of the investments in associated companies at June 30, 2011 were determined by 

Ernst & Young using a combination of adjusted net assets, capitalised earnings and recent transaction 

value. 

9 INVESTMENTS IN FINANCIAL ASSETS 

(a) 

The movement in investments in financial assets may be summarised as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

At July 1, 835,286 872,285 826,550 863,549 

Acquisition through business combination 19,416 - - - 

Additions 17,018 - 17,018 - 

Disposal (66) - - - 

Fair value adjustments (163,696) (36,999) (163,696) (36,999) 

Transfer to non-current assets 

classified as held for sale (note 15) (679,872) - (679,872) - 

At June 30, 28,086 835,286 - 826,550 

Made up of investments in: 

Fellow subsidiaries - 690,731 - 690,731 

Others 28,086 144,555 - 135,819 

28,086 835,286 - 826,550 

(b) At June 30, 2011 

Level 1 Level 2 Level 3 Total 

Rs’000 Rs’000 Rs’000 Rs’000 

The group - - 28,086 28,086 

The company - - - - 

At June 30, 2010 Level 1 Level 2 Level 3 Total 

Rs’000 Rs’000 Rs’000 Rs’000 

The group 135,819 - 699,467 835,286 

The company 135,819 - 690,731 826,550 

Investments included in level 1 comprise of some quoted equity investments valued at their closing 

market prices. If all significant inputs required to fair value an investment are observable, the instrument 

is included in level 2. If one or more of the significant inputs are not based on observable market data, 

the investment is included in level 3. Further information is presented in note 3.2. 

88 





9 INVESTMENTS IN FINANCIAL ASSETS (continued) 

(c) 

The changes in level 3 instruments for the year ended June 30, 2011 and 2010 were as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Opening balance 699,467 699,467 690,731 690,731 


Disposals (66) - - - 

Transfers to non-current assets classified 

as held for sale (note 15) (690,731) - (690,731) - 

Closing balance 28,086 699,467 - 690,731 

(d) 

Available for sale financial assets include the following: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Equity securities at fair value: 

- Official market - 298,290 - 298,290 

- DEM listed - 528,260 - 528,260 

- Unquoted 28,086 8,736 - - 

28,086 835,286 - 826,550 

The fair value of the securities at June 30, 2011 has been determined by Ernst & Young using various 

bases of valuation and assumptions based on adjusted earnings and on their adjusted net assets. 

Some of the quoted securities have been valued at their closing market prices. 

The investments in financial assets are denominated in Mauritian rupees. 

(e) 

(f) 

Bank borrowings are secured on some investments of the group. 

None of the financial assets are impaired. 

10 DEPOSIT ON INVESTMENTS 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Equity securities at fair value: 

At July 1, 52,891 - 57,891 - 

Transfer to investments in subsidiary companies (52,891) - (57,891) - 

Additions 9,321 52,891 9,321 57,891 

At June 30, 9,321 52,891 9,321 57,891 

Deposits on investments relate to application monies in companies in respect of which share have not 

yet been alloted at June 30, 2011. 



89



11 INVENTORIES 

THE GROUP 


Rs’000 Rs’000 

Finished goods 132,033 115,928 

Raw materials 237,872 160,271 

Goods in transit 141 8,968 

Work in progress 43,767 1,455 

413,813 286,622 

Borrowings are secured by floating charges on the assets of the group including inventories. 

12 TRADE AND OTHER RECEIVABLES 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Trade receivables 523,880 245,406 - - 

Less provision for impairment (24,606) (24,081) - - 

Trade receivables - net 499,274 221,325 - - 

Investment income receivable - 6,899 2,349 6,899 

Prepayments and other receivables 57,312 40,501 2,136 2,136 

556,586 268,725 4,485 9,035 

The carrying amounts of trade and other receivables approximate their fair values. 

As of June 30, 2011, trade receivables of Rs.45m (2010: Rs.42m) for the group were past due, out of 

which Rs.25 million were impaired. The provision for impairment was Rs.25m (2010: Rs.24m) for the 

group. 

The individually impaired receivables relate mainly to debtors with overdue balances. It was assessed 

that a proportion of the receivables is expected to be recovered. The ageing of these receivables is 

as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

3 to 6 months 12,254 11,418 - - 

Over 6 months 33,177 30,895 - - 

45,431 42,313 - - 

On June 30, 2011, trade receivables of Rs.29m (2010: Rs.43m) for the group were past due but not 

impaired. 

These relate to a number of independent customers for whom there is no recent history of default. The 

ageing analysis of these receivables is as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

3 to 6 months 17,012 39,166 - - 

Over 6 months 11,532 4,758 - - 

28,544 43,924 - - 

90 





12 TRADE AND OTHER RECEIVABLES (continued) 

The carrying amounts of trade and other receivables are denominated in the following currencies: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Rupee 512,173 266,391 4,485 9,035 

US Dollar 32,509 2,104 - - 

Euro 11,894 210 - - 

Other currencies 10 20 - - 

556,586 268,725 4,485 9,035 

The movement in the provision for impairment of trade receivables is as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

At July 1, 24,081 24,278 - - 


Provision for receivable impairment 3,514 2,551 - - 

Bad debts written off during the year as 

uncollectible (5,145) (2,748) - - 

At June 30, 24,606 24,081 - - 

The other classes within trade and other receivables do not contain impaired assets. 

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable 

mentioned above. The group does not hold any collateral as security. 

13 AMOUNTS RECEIVABLE FROM GROUP COMPANIES 


Loans Others Total Total 

THE GROUP Rs’000 Rs’000 Rs’000 Rs’000 

Holding company - 788 788 360 

Fellow subsidiaries - 10,157 10,157 25,130 

- 10,945 10,945 25,490 

THE COMPANY 

Subsidiary companies 24,500 33,836 58,336 33,509 

Fellow subsidiaries - 8,464 8,464 24,189 

24,500 42,300 66,800 57,698 

As of June 30, 2011, amounts receivable from group companies were neither impaired nor past due. 

The carrying amount of group receivables approximate their fair values. 

Amounts receivable from group companies are denominated in Mauritian rupees. The maximum 

exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned 

above. The group does not hold any collateral as security. 



91



14 HELD FOR TRADING SECURITIES 

THE GROUP AND THE COMPANY 

(a) 

The carrying amounts of the held for trading securities are classified as follows: 

Listed 

Unquoted 

Official DEM 2011 2010 

market listed Total Total 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

At July 1, 1 - 3,755 3,756 21,520 

Disposal - - - - (19,254) 

Fair value gains - - - - 1,490 

At June 30, 1 - 3,755 3,756 3,756 

(b) At June 30, 2011 & 2010 

Level 1 Level 2 Level 3 Total 

Rs’000 Rs’000 Rs’000 Rs’000 

Held for trading securities - - 3,756 3,756 

Held for trading securities comprise principally of unquoted investments and were valued by Ernst & 

Young at the end of the reporting period. Unquoted investments were valued on a dividend yield basis. 

Held for trading securities are denominated in Mauritian rupees. 

Investments included in level 1 comprise of quoted equity investments. If all significant inputs required 

to fair value an investment are observable, the investment is included in level 2. If one or more of the 

significant inputs are not based on observable market data, the investment is included in level 3. 

Further information is presented in note 3.2. 

The carrying amount of held for trading securities would be an estimated Rs 375,000 lower/higher 

were the alternative valuation techniques used to differ by 10 % from management estimates. 

(c) 

Changes in fair values of held for trading securities are recorded on the statement of comprehensive 

income. 

15 NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

At July 1, - - - - 

Transfer from investment in financial assets 679,872 - 679,872 - 

At June 30, 679,872 - 679,872 - 

At a board meeting held on 22 August, 2011, it was resolved that the company will dispose of its noncore 

investments in the next financial year. Consequently these investments have been reclassified as 

non current assets classified as held for sale. 

92 





16 SHARE CAPITAL 

Number of Ordinary Share 

shares shares premium Total 

Rs’000 Rs’000 Rs’000 

At June 30, 2011 and 2010 29,172,500 29,173 148,787 177,960 

The total number of ordinary shares is 29,172,500 shares (2010: 29,172,500 shares) with no par value. 

All issued shares are fully paid. 

17 BORROWINGS 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Non-current 

Bank loans 346,718 107,524 134,674 33,881 

Unsecured loans 40 40 40 40 

Loan capital excluding obligations under 

finance leases (see note (b)) 346,758 107,564 134,714 33,921 

Obligations under finance lease (see note (c)) 56,260 27,365 - - 

403,018 134,929 134,714 33,921 

Current 

Bank overdrafts 136,238 199,603 28,515 62,860 

Bank loans 190,168 123,936 71,482 82,789 

Loans at call 8 8 8 8 

Obligations under finance lease (see note (c)) 29,568 12,245 - - 

355,982 335,792 100,005 145,657 

Total borrowings 759,000 470,721 234,719 179,578 

(a) 

(b) 

The bank loans and other secured loans are secured over certain of the assets of the group. Lease 

liabilities are effectively secured as the rights to the leased assets revert to the lessor in the event of 

default. 

The maturity of non current loans is as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Repayable by instalments: 

- after one year and before two years 40,677 20,934 21,898 14,161 

- after two years and before three years 32,464 22,778 14,306 14,585 

- after three years and before five years 88,962 13,348 39,513 5,135 

- after five years 184,655 50,504 58,997 40 

346,758 107,564 134,714 33,921 

The carrying amounts of non-current borrowings are not materially different from their fair values. 



93



17 BORROWINGS (continued) 

(c) 

THE GROUP 


Rs’000 Rs’000 

Finance lease liabilities-minimum lease payments 

Not later than 1 year 36,535 16,036 

After one year and before two years 31,438 14,775 

After two years and before three years 12,587 13,047 

After three years and before five years 20,820 3,361 

After five years 456 - 

101,836 47,219 

Future finance charges on finance leases (16,008) (7,609) 

Present value of finance lease liabilities 85,828 39,610 

THE GROUP 


Rs’000 Rs’000 

The present value of finance lease liabilites 

may be analysed as follows: 

Not later than 1 year 29,568 12,245 

After one year and before two years 27,709 12,074 

After two years and before three years 11,657 11,406 

After three years and before five years 16,438 3,885 

After five years 456 - 

85,828 39,610 

The group leases some plant and equipment, motor vehicles and furniture and fittings under finance 

leases. 

The leases have purchase options on termination. There are no restrictions imposed on the group by 

lease arrangements. 

(d) 

Non-current borrowings can be analysed as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

- after one year and before five years 

Bank borrowings 162,103 57,060 75,717 33,881 

- after two years and before three years 


- after three years 


Other loans 40 40 40 40 

273,617 63,852 98,510 5,175 

(e) 

The interest rates at the end of the reporting period were as follows: 

THE GROUP 

THE COMPANY 


USD EURO Rs Rs Rs Rs 

% % % % % % 

Bank overdrafts 6.35 - 9.25-10.125 9.375-16.875 9.625 9.625 

Bank loans 4 4 7.25-15 9.50-10.00 7.25-12.25 9.875 

Other loans - - 11 11 - 9.375 

Debentures - - 5 - - - 

Finance lease liabilities - - 9-13.8 9.50-12.75 - - 

94 





17 BORROWINGS (continued) 

(f) 

(g) 

The exposure of the group’s borrowings to interest rate changes and the contractual repricing dates 

are less than 6 months. 

The carrying amounts of borrowings are denominated in the following currencies. 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Rupees 732,956 470,547 234,719 179,578 

US Dollar 20,951 174 - - 

EURO 10,284 - - - 

764,191 470,721 234,719 179,578 

18 DEFERRED INCOME TAX 

(a) Deferred income tax is calculated on all temporary differences under the liability method at 15% (2010: 

15%). 

Deferred tax assets are recognised for tax losses carried forward only to the extent that realisation of 

the related tax benefit is probable. The recoverability of tax losses is limited to a period of five years 

from the relevant year of assessment. 

At the end of the reporting period, the group had unused tax losses of Rs. 53m (2010: Rs.108m) 

available for offset against future profits. No deferred tax asset has been recognised in respect of such 

losses due to the unpredictability of future profit streams. 

There is a legally enforceable right to offset deferred tax asset against deferred tax liabilities when the 

deferred income taxes relate to the same fiscal authority on the same entity. 

The following amounts are shown on the statement of financial position: 

THE GROUP 


Rs’000 Rs’000 

Deferred tax liabilities 33,462 4,784 

Deferred tax assets (5,827) (1,477) 

27,635 3,307 

(b) 

The movement in the deferred income tax account is as follows: 

THE GROUP 


Rs’000 Rs’000 

At July 1, 3,307 3,721 

Acquisition through business combination 2,593 - 

Credited to statement of comprehensive income (685) (414) 

Charged to revaluation surplus 22,420 - 

At June 30, 27,635 3,307 



95



18 DEFERRED INCOME TAX (continued) 

(c) 

The movement in deferred income tax assets and liabilities during the year is as follows: 

Deferred tax liabilities 

Accelerated Revaluation 

tax 

of 

depreciation assets Total 

Rs’000 Rs’000 Rs’000 

At July 1, 2009 4,997 54 5,051 

Credited to statement of comprehensive income (267) - (267) 

At June 30, 2010 4,730 54 4,784 

Acquisition through business combination 3,445 2,809 6,254 

Charged/(credited) to statement of 

comprehensive income 61 (57) 4 

Charged to revaluation surplus - 22,420 22,420 


Deferred tax assets 

Retirement benefit obligations 

Total 

Rs’000 

At July 1, 2009 (1,330) 

Credited to statement of comprehensive income (147) 

At June 30, 2010 (1,477) 

Acquisition through business combination (3,661) 

Credited to statement of comprehensive income (689) 

At June 30, 2011 (5,827) 

Net deferred tax liabilities 27,635 

(d) 

The deferred income tax charged to equity during the year is as follows: 

THE GROUP 


Rs’000 Rs’000 

Fair values and other reserves in shareholders’ equity 

- Buildings 22,420 - 

19 RETIREMENT BENEFIT OBLIGATIONS 

THE GROUP 


Rs’000 Rs’000 

Pension schemes 8,980 8,174 

Other post retirement benefits 38,513 10,999 

47,493 19,173 

96 





19 RETIREMENT BENEFIT OBLIGATIONS (continued) 

(a) 

(i) 

Pension benefits 

THE GROUP 


Rs’000 Rs’000 

The amounts recognised on the statements of 

financial position are as follows: 

Present value of funded obligations 39,379 33,319 

Fair value of plan assets (25,406) (21,747) 

13,973 11,572 

Unrecognised actuarial loss (4,993) (3,398) 

Liability on the statement of financial position 8,980 8,174 

(ii) 

The movement in the defined benefit obligations during the year is as follows: 

THE GROUP 


Rs’000 Rs’000 

At July 1, 33,319 30,325 

Current service cost 2,969 2,669 

Interest cost 3,280 3,136 

Benefits paid (2,426) (97) 

Liability loss/(gain) 2,237 (2,714) 

At June 30, 39,379 33,319 

(iii) The movement in the fair value of plan assets during the year is as follows: 

THE GROUP 


Rs’000 Rs’000 

At July 1, 21,747 18,215 

Expected return on plan assets 2,317 1,964 

Employer contributions 3,336 3,006 

Scheme expenses (5) (5) 

Cost of insuring risk benefits (140) (132) 


Actuarial gain/(loss) recognised 577 (1,204) 

At June 30, 25,406 21,747 

(iv) The amounts recognised on the statements of comprehensive income are as follows: 

THE GROUP 


Rs’000 Rs’000 

Current service cost 2,969 2,669 

Cost of insuring risk benefits 140 132 


Scheme expenses 5 5 

Expected return on plan assets (2,317) (1,964) 

Effect of immediate recognition in liability - 57 

Net actuarial losses recognised during the year 65 109 

Total included in employee benefit expense (note 26) 4,142 4,144 

Actual return on plan assets 2,893 1,231 



97




(v) 

Movement in the liability recognised on the statements of financial position is as follows: 

THE GROUP 


Rs’000 Rs’000 

At July 1, 8,174 7,036 

Total expense 4,142 4,144 

Contributions paid (3,336) (3,006) 

At June 30, 8,980 8,174 

(vi) The assets in the plan were: 

THE GROUP 


Rs’000 Rs’000 

Local equities 28 44 

Property 1 2 

Overseas bonds and equities 14 12 

Insured contracts - 42 

Fixed interest 22 - 

Others 35 - 

Total 100 100 

Where the plan is funded, the overall expected rate of return on plan assets is determined by reference 

to market yields on bonds and expected yield differences on other types of assets held. 

For certain subsidiaries, the asset of the plan is equivalent to the value of deferred annuity contracts 

which have been invested in the life fund of The Anglo Mauritius Assurance Society Ltd. 

(vii) Amounts for the current and and previous four years are as follows: 

THE GROUP 

2011 2010 2009 2008 2007 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Fair value of plan assets 25,406 21,747 18,215 18,577 14,588 

Present value of defined benefit 

obligations (39,379) (33,319) (30,325) (25,094) (16,357) 

Deficit (13,973) (11,572) (12,110) (6,517) (1,769) 

Asset experience gain/(loss) 

during the year 577 (1,204) (4,285) (260) 1,308 

Liability experience loss/(gain) 

during the year 2,237 (2,714) 1,109 4,183 (801) 

(viii) The principal actuarial assumptions used for accounting purposes were as follows: 

THE GROUP 


% % 

Discount rate 10.0 10.0 

Expected return on plan assets 10-10.5 10.5 

Future salary increases 8-8.5 8.3 

Future pension increases 4.0 4.0 

(ix) Expected employer contributions for the year ending June 30, 2012 are Rs. 3 million for the group. 

98 






(b) 

(i) 

Other post retirement benefits 

Other post retirement benefits comprise of retirement gratuities payable under the Employment Rights 

Act 2008 and other benefits. 

The amounts recognised on the statement of financial position are as follows: 

THE GROUP 


Rs’000 Rs’000 

Present value of unfunded obligations 41,894 12,348 

Unrecognised actuarial loss (3,381) (1,349) 

Liability on the statement of financial position 38,513 10,999 

(ii) 

The movement in the defined benefit obligation during the year is as follows: 

THE GROUP 


Rs’000 Rs’000 

At July 1, 12,348 11,916 


Other adjustments - (17) 

Current service cost 2,430 383 



Effect of curtailments/settlements (428) (504) 

Liability loss recognised 884 320 

At June 30, 41,894 12,348 

(iii) The amounts recognised on the statements of comprehensive income are as follows: 

THE GROUP 


Rs’000 Rs’000 

Current service cost 2,430 383 


Actuarial loss recognised 171 64 

Effect of curtailments/settlements (575) (548) 

Total included in employee benefit expense 5,895 1,096 

(iv) Movement in the liability recognised on the statements of financial position is as follows: 

THE GROUP 


Rs’000 Rs’000 

At July 1, 10,999 10,867 


Transfer - (17) 

Total expense 5,895 1,096 


At June 30, 38,513 10,999 



99




(b) 

(v) 

Other post retirement benefits (continued) 

Amounts for the current and previous four years are as follows: 

THE GROUP 

2011 2010 2009 2008 2007 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Present value of unfunded obligations (41,894) (12,348) (11,916) (12,090) (11,790) 

Liability experience loss/(gain) 

during the year 884 320 (9) 207 48 

(vi) The principal actuarial assumptions used for accounting purposes were: 

THE GROUP 


% % 

Discount rate 10.0 10.0 

Future salary increases 8 - 8.5 8.0 

Future pension increase 4.0 0.0 

20 DEFERRED INCOME 

THE GROUP 


Rs’000 Rs’000 

At July 1, - - 

Acquisition through business combination 773 - 

Release to statement of comprehensive income (163) - 

At June 30, 610 - 

21 TRADE AND OTHER PAYABLES 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Trade payables 324,851 79,969 - - 

Accruals and other payables 120,015 88,423 2,476 3,513 

444,866 168,392 2,476 3,513 

Trade and other payables are denominated in Mauritian rupees and their carrying amounts approximate 

their fair values. 

22 AMOUNTS PAYABLE TO GROUP COMPANIES 



THE GROUP Rs’000 Rs’000 Rs’000 Rs’000 

Holding company - 15,035 15,035 15,731 

Fellow subsidiaries 146,088 287 146,375 137,175 

146,088 15,322 161,410 152,906 

100 





22 AMOUNTS PAYABLE TO GROUP COMPANIES 



THE COMPANY Rs’000 Rs’000 Rs’000 Rs’000 

Holding company - - - 13,141 

Subsidiary companies - - - 62 

Fellow subsidiaries 11,088 - 11,088 11,088 

11,088 - 11,088 24,291 

Group payables are denominated in Mauritian rupees and their carrying amounts approximate their 

fair values. 

23 INCOME TAX EXPENSE 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Liability 

At July 1, 5,558 4,460 78 414 


(Over)/under provision (402) 126 - (35) 

APS (2,799) 30 - 30 

Charge for the year 11,252 7,680 96 77 

Paid during the year (11,498) (6,738) (90) (408) 

At June 30, 3,173 5,558 84 78 

Charge 

Current tax on adjusted profits for 

the year at 15 % (2010: 15 %) 11,252 7,680 96 77 

(Over)/under provision (402) 126 - (35) 

APS overpaid - 30 - 30 

Deferred tax (note 18) (685) (414) - - 

10,165 7,422 96 72 

The tax on the group’s and company’s results before tax differs from the theoretical amount that would 

arise using the basic tax rate as follows: 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Profit before tax 100,428 33,921 30,471 26,872 

Tax calculated at 15% (2010: 15%) 15,064 5,088 4,571 4,031 

Tax effect of: 

- Income not subject to tax (18,821) (7,179) (8,583) (7,056) 

- Expenses not deductible for tax purposes 5,824 4,070 4,108 3,132 

- Alternative minimum payment 10 - - - 

- Tax losses for which no deferred tax asset 

was recognised - 165 - - 

- Other tax allowances 1,434 - - - 

- Consolidation adjustment 6,426 3,278 - - 

- Tax losses generated in the year 39 1,022 - - 

- Utilisation of previously unrecognised tax losses - 106 - - 

- Deferred tax not recognised - 32 - - 

- (Over)/under provision from previous year (402) 126 - (35) 

- Effect of tax of associated companies 591 714 - - 

Tax charge 10,165 7,422 96 72 



101



24 DIVIDENDS 


Rs’000 Rs’000 

Amounts recognised as distributions to equityholders during the year: 

Interim dividend for the year ended June 30, 2011 

of Re. 0.40 (2010:Re. 0.40) per share 11,669 11,669 

Final dividend for the year ended June 30, 2011 

of Re. 0.50 (2010: Re.0.40) per share 14,586 11,669 

The final proposed dividend was paid on July 25, 2011. 

26,255 23,338 

25 PROFIT BEFORE TAXATION 

(a) 

THE GROUP 




management Commercial Industry Total management Commercial Industry Total 


Profit before taxation is 

arrived at after: 

crediting: 

Investment income - official market 5,203 - - 5,203 5,479 - - 5,479 

- DEM Listed 10,630 - - 10,630 13,868 - - 13,868 

- unquoted 244 - - 244 720 - - 720 

Interest receivable - 835 239 1,074 1,033 990 - 2,023 

Profit on disposal of property, 

plant and equipment - 6,151 1,055 7,206 - 1,594 263 1,857 

Profit on sale of investments 5,131 - 899 6,030 2,159 - - 2,159 

Fair value gain on held-for-trading 

securities (note 14) - - - - 1,490 - - 1,490 

and charging: 

Cost of inventories recognised as expense - 1,252,245 969,383 2,221,628 - 1,049,176 40,564 1,089,740 

Depreciation on property, plant 

and equipment (note 5) 

- owned assets 432 30,488 16,502 47,422 415 25,070 1,521 27,006 

- leased assets under finance lease - 11,033 14,232 25,265 - 13,153 1,213 14,366 

Amortisation of intangible assets (note 6) - 3,822 1,082 4,904 - 3,342 10 3,352 

Property, plant and equipment written off - 51 - 51 - 716 - 716 

Employee benefit expense (note 26) - 108,853 42,942 151,795 - 100,609 14,329 114,938 

(b) THE COMPANY 


Rs’000 Rs’000 

Profit before taxation is arrived at after 

crediting: 

Investment income - official market 5,203 6,824 

- DEM quoted 10,630 12,522 

- unquoted 33,593 23,619 

Interest receivable 2,445 2,157 

Profit on sale of investments 7,623 2,159 

Fair value gain on held-for-trading securities - 1,490 

102 





26 EMPLOYEE BENEFIT EXPENSE 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Wages and salaries 133,479 99,087 - - 

Social security and other costs 8,279 10,611 - - 

Pension costs - defined benefit plans 4,142 4,144 - - 

- other post retirement benefits 5,895 1,096 - - 

The company has no employees. 

151,795 114,938 - - 

27 FINANCE COSTS 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Interest expense: 

- Bank overdrafts 20,976 5,700 1,678 522 

- Bank and other loans repayable by instalments 47,621 21,975 15,594 9,824 

- Other loans not repayable by instalments - 1,648 - 1,438 

- Finance leases 5,492 1,030 - - 

- Debentures 500 - - - 

Net foreign exchange transaction gains (573) (1,308) - - 

74,016 29,045 17,272 11,784 

28 OTHER COMPREHENSIVE INCOME 

THE GROUP 

Fair value Revaluation Other 

reserves surplus reserves Total 

Rs’000 Rs’000 Rs’000 Rs’000 



available for sale financial assets (163,696) - - (163,696) 

Surplus on revaluation of properties 

net of deferred tax - 55,882 - 55,882 

Share of results of associates - - 2,689 2,689 

(163,696) 55,882 2,689 (105,125) 

2010 


available for sale financial assets (36,999) - - (36,999) 

Share of results of associates - - 5,349 5,349 

(36,999) - 5,349 (31,650) 



103



28 OTHER COMPREHENSIVE INCOME (continued) 

THE COMPANY 

Fair value 

reserves 

Total 

Rs’000 Rs’000 


Fair value movement on available for sale financial assets (104,768) (104,768) 

Release to income on disposal of available for sale financial assets (8,009) (8,009) 

2010 

(112,777) (112,777) 

Rs’000 Rs’000 

Fair value movement on available for sale financial assets 14,829 14,829 

29 EARNINGS PER SHARE 

THE GROUP 

THE COMPANY 


Profit attributable to equityholders 

of the holding company Rs’000 81,939 26,566 30,376 26,800 

Number of ordinary shares in issue (‘000) 29,173 29,173 29,173 29,173 

Earnings per share Rs. 2.81 0.91 1.04 0.92 

30 NOTES TO THE STATEMENTS OF CASH FLOWS 

(a) 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Cash generated from operations 

Profit before taxation 100,428 33,921 30,471 26,872 

Adjustments for: 

Depreciation on property, plant & equipment 72,687 41,372 - - 

Profit on sale of investments (6,030) (2,159) (7,623) (2,159) 

Profit on sale of property, plant and equipment (7,206) (1,857) - - 

Provision written back - - (317) - 

Property, plant and equipment written off 51 716 - - 

Fair value gain on business combinations (41,159) - - - 

Fair value gain on held for trading securities - (1,490) - (1,490) 

Fair value adjustment of financial liabilities (156) - - - 

Amortisation of intangible assets 4,904 3,352 - - 

Share of net results of associates 6,774 11,660 - - 

Interest income (1,074) (2,023) (2,445) (2,157) 

Interest expense 74,589 29,045 17,272 11,784 

Retirement benefit obligations 3,920 1,271 - - 

Changes in working capital 

- inventories (89,843) 14,611 - - 

- trade and other receivables (86,810) (61,495) (700) 6,385 

- amounts receivable from group companies (2,308) (524) (13,535) (4,666) 

- trade and other payables 75,421 17,573 (571) 1,421 

- amounts payable to group companies (9,177) 3,348 (1,562) (674) 

Cash generated from operations 95,011 87,321 20,990 35,316 

104 





30 NOTES TO THE STATEMENTS OF CASH FLOWS (continued) 

(b) 

(c) 

THE GROUP 

THE COMPANY 


Rs’000 Rs’000 Rs’000 Rs’000 

Cash and cash equivalents 

Bank overdrafts (136,238) (199,603) (28,515) (62,860) 

Cash in hand and at bank 47,325 11,189 119 489 

Cash and cash equivalents (88,913) (188,414) (28,396) (62,371) 

Major non-cash transactions 

Non-cash transactions relate to the acquisition of property, plant and equipment under finance leases. 

31 SEGMENTAL INFORMATION 

THE GROUP 


Notes management Commercial Industry Total 

Rs’000 Rs’000 Rs’000 Rs’000 

Segment assets 850,905 1,028,222 617,361 2,496,488 

Investments in associates 8 9,305 15,378 11,303 35,986 

Consolidated total assets 860,210 1,043,600 628,664 2,532,474 

Segment liabilities 266,745 654,906 537,122 1,458,773 

Additions to non current assets 5& 6 2,052 48,005 27,348 77,405 

Depreciation and amortisation 5& 6 - 45,515 32,076 77,591 

Material items of income 

- Profit on disposal of investments 5,131 - 899 6,030 

- Fair value gain arising on business 

combination 41,159 - - - 

Material items of expenditure 

- Fair value adjustment of financial 

liabilities - - 5,035 5,035 

Interest income - 835 239 1,074 

Interest expense 17,487 41,673 15,429 74,589 




105



31 SEGMENTAL INFORMATION (continued) 

THE GROUP 2010 


Notes management Commercial Industry Total 

Rs’000 Rs’000 Rs’000 Rs’000 

Segment assets 945,057 931,607 37,302 1,913,966 

Investments in associates 8 - 29,946 (7,658) 22,288 

Consolidated total assets 945,057 961,553 29,644 1,936,254 

Segment liabilities 221,929 593,020 16,777 831,726 

Additions to non current assets 5& 6 105 171,716 2,734 174,555 

Property, plant and equipment 

written off - 716 - 716 

Depreciation and amortisation 5& 6 415 41,565 2,744 44,724 

Material items of income 

- Fair value gain on held-fortrading 

securities 1,490 - - 1,490 

- Profit on disposal of investments 2,159 - - 2,159 

Material items of expenditure 

Provision for guarantee - (2,939) - (2,939) 

Interest income 2,023 - - 2,023 

Interest expense 12,042 893 17,418 30,353 

32 RELATED PARTY TRANSACTIONS 

(a) 

THE GROUP 

Holding company Fellow subsidiaries Associates 

2011 2010 2011 2010 2011 2010 

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 

Purchase of goods and services - - 796 14,548 1,489 456 

Sales of goods and services 410,371 7,655 19,479 23,713 25,033 13,699 

Loans payable - 11,500 46,088 11,088 - - 

Loans receivable - - 106,000 17,500 - - 

Interest expense 496 1,376 1,296 - - - 

Interest income - - - 1,033 - - 

Amounts owed by related parties 91,376 360 12,812 7,630 5,268 3,347 

Amounts owed to related parties 496 4,231 100,311 126,087 43 - 

Management fees 10,226 9,717 123 - - - 

Rental income - 1,409 - - - - 

Rental expense - - - 14,206 - - 

(b) 

THE COMPANY 

Holding company Subsidiaries Fellow subsidiaries Associates 

2011 2010 2011 2010 2011 2010 2011 2010 


Loans receivable - - 24,500 17,400 - 17,500 - - 

Loans payable - 11,500 - - 11,088 11,088 - - 

Deposit on investment - - - 5,000 - - - - 

Amounts owed by related 

parties - - 33,836 16,109 8,464 6,689 - - 

Amounts owed to related 

parties - 1,641 - 62 - - - - 

Loans paid - - - - - - - - 

Interest income - - 2,445 1,123 - 1,033 - - 

Interest expense 496 1,376 - - - - - - 

Management fees 5,000 5,000 - - - - - - 

106 





32 RELATED PARTY TRANSACTIONS (continued) 

The sales to and purchases from related parties are made at normal market prices. Outstanding 

balances at the year end are unsecured, interest free (except for loans receivable and payable) and 

settlement occurs in cash. 

For the year ended June 30, 2011, the group has not recorded any impairment of receivables relating 

to amounts owed by related parties (2010: nil) This assessment is undertaken each financial year 

through examining the financial position of the related party and the market in which the related party 

operates. 

The loans receivable from subsidiaries are receivable at call. 

(c) Key management personnel compensation 

THE GROUP AND 

THE COMPANY 


Rs’000 Rs’000 

Directors fees 1,133 1,148 

33 BUSINESS COMBINATIONS 

(a) Acquisition of Subsidiary 

During the year, the group made the following acquisitions: 

(1) 100% of the share capital of Charabia Ltd, a company providing interior decorating services for Rs. 20 

million. 

(2) On July 1, 2010, the group acquired a further 21 % of the share capital of Cogir Limitée for Rs. 52.8 

million and obtained control of the latter. Cogir is engaged in construction and was previously an 

associate of the group. 

(3) On July 1, 2010, the group acquired a further 24.63 % of the share capital of Plastinax Austral Ltd and 

obtained control of the latter. Plastinax Austral Ltd is engaged in production of sunglasses and was 

previously an associate of the group. 

Goodwill of Rs.94.3 million arising from the acquisitions of two subsidiaries is attributable to acquired 

customer base and synergies expected from combining the operations of the group and these 

companies. Additional goodwill amounting to Rs.37.9m arose due to acquisition at nil value of a 

subsidiary having deficit of assets. This goowill was written off during the year. 

None of the goodwill recognised is expected to be deductible for income tax purposes. The following 

table summarises the consideration paid for the acquisition of Cogir Limitée, Plastinax Austral Limitée 

and Charabia Ltd and the amounts of the assets acquired and liabilities assumed recognised at the 

acquisition date, as well as the fair value at the acquisition date of the non-controlling interests. 



107



33 BUSINESS COMBINATIONS (continued) 

(a) 

Acquisition of subsidiary (continued) 


Rs’000 

Consideration 

Cash 20,000 

Transfer from deposit 52,892 

Fair value of equity interest held before the business combinations 70,000 

Total consideration 142,892 

Acquisition-related costs - 

Recognised amounts of identifiable assets acquired and 

liabilities assumed 

Cash and cash equivalents (12,510) 

Property, plant and equipment 162,101 

Intangible assets 3,646 

Investment in associate 8,631 

Investment in financial assets 19,416 

Inventories 45,877 

Trade and other receivables 201,906 

Trade and other payables (221,980) 

Borrowings (150,689) 

Retirement benefit obligations (25,573) 

Taxation (1,062) 

Deferred income (773) 

Dividend proposed (15,000) 

Deferred tax liabilities (2,593) 

Total identifiable net assets 11,397 

Non-controlling interests (669) 

Goodwill (note 6) 132,164 

142,892 

Net cash outflow on acquisition of subsidiaries 

Rs’000 

Consideration paid in cash 20,000 

Cash and cash equivalents acquired 12,510 

32,510 

In 2011, the acquired business contributed revenues of Rs.1,045 million and net profit of Rs.17 million 

to the group. 

If the acquisition had occurred on 1 July 2010, the group’s revenue would have been Rs.1,077 million 

and profit for the year would have been Rs.19 billion. 

108 





33 BUSINESS COMBINATIONS (continued) 

(b) 

Disposal of Subsidiary 

On December 31, 2010, the group disposed of its holding in Anthurium and Orchids Limited and 

Exotiflors Limited, a wholly owned subsidiary of the latter. 

Anthurium and Orchids Limited was engaged in the rental of shadehouses and it realised an operating 

profit of Rs.284,105 for the period from July 1, 2010 to December 31, 2010 (operating loss of 

Rs 562,736 for the year ended June 30, 2010). 

Exotiflors Limited is a dormant company and it incurred an operating loss of Rs. 10,619 for the period 

from July 1, 2010 to December 31, 2010 (operating loss of Rs. 742,722 for the year ended June 30, 

2010). 

Consideration received 

Rs’000 

Sales proceeds 13,700 

Cash and cash equivalents disposed 947 

The details of assets and liabilities disposed and the consideration are as follows: 

Carrying amount of net assets 

14,647 

Rs’000 

Property plant and equipment 8,934 

Investment in securities 66 

Trade and other receivables 2,502 

Trade and other payables (1,986) 

Overdraft (947) 

Net assets disposed of 8,569 

Gain on disposal 

Consideration received 13,700 

Net assets disposed of (8,569) 

Gain on disposal 5,131 



109



34 THREE-YEAR SUMMARY OF GROUP PUBLISHED RESULTS AND ASSETS AND 

LIABILITIES 

(a) 

THE GROUP 

2011 2010 2009 

Rs’000 Rs’000 Rs’000 

Statements of comprehensive income 

Revenue 2,631,792 1,345,657 1,324,690 

Share of results of associates (3,937) (4,760) 18,866 

Profit before taxation 95,237 33,921 35,188 

Income tax expense (10,165) (7,422) (4,529) 

Profit for the year 85,072 26,499 30,659 

Other comprehensive income for the year (105,125) (31,650) 90,979 

Total comprehensive income for the year (20,053) (5,151) 121,638 

Profit attributable to:- 

Equity holders of the company 81,939 26,566 30,749 

Non controlling interests 3,133 (67) (90) 

85,072 26,499 30,659 

Total comprehensive income attributable to:- 

Equity holders of the company (25,028) (5,084) 121,921 

Non controlling interests 4,975 (67) (283) 

(20,053) (5,151) 121,638 

Dividends per share Rs. 0.90 0.80 0.80 

Earnings per share Rs. 2.81 0.91 1.05 

Statements of financial position 

ASSETS 

Non-current assets 820,177 1,340,472 1,198,819 

Current assets 1,032,425 595,782 560,218 

Non-current assets classified as held for sale 679,872 - - 

Total assets 2,532,474 1,936,254 1,759,037 

EQUITY AND LIABILITIES 

Capital and reserves 1,053,259 1,104,448 1,132,870 

Non-controlling interests 15,251 80 147 

Total equity 1,068,510 1,104,528 1,133,017 

LIABILITIES 

Non-current liabilities 496,448 157,409 180,820 

Current liabilities 967,516 674,317 445,200 

Total equity and liabilities 2,532,474 1,936,254 1,759,037 

110 





34 THREE-YEAR SUMMARY OF GROUP PUBLISHED RESULTS AND ASSETS AND 

LIABILITIES (continued) 

(b) 

THE COMPANY 

2011 2010 2009 

Rs’000 Rs’000 Rs’000 

Statements of comprehensive income 

Revenue 51,871 45,122 51,431 

Profit before taxation 30,471 26,872 27,803 

Income tax expense (96) (72) (414) 

Profit for the year 30,375 26,800 27,389 

Other comprehensive income for the year (112,777) 14,829 65,796 

Total comprehensive income for the year (82,402) 41,629 93,185 

Dividends per share Rs. 0.90 0.80 0.80 

Earnings per share Rs. 1.04 0.92 0.94 

Statement of financial position 

ASSETS 

Non-current assets 877,683 1,626,570 1,552,350 

Current assets 75,160 70,978 65,785 

Non-current assets classified as held for sale 679,872 - - 

Total assets 1,632,715 1,697,548 1,618,135 

EQUITY AND LIABILITIES 

Capital and reserves 1,369,762 1,478,419 1,460,128 

Non-current liabilities 134,714 33,921 45,533 

Current liabilities 128,239 185,208 112,474 

Total equity and liabilities 1,632,715 1,697,548 1,618,135 

35 EVENTS AFTER THE REPORTING PERIOD 

At a board meeting held on 22 August 2011, it was resolved that the company will dispose of its noncore 

investments to related companies for a cash consideration of Rs 675 million. 

The sale is subject to approval by shareholders at a special meeting to be held on 7 October, 2011. 

36 CONTINGENT LIABILITIES 

One of the subsidiaries of the group is being sued by its former general manager for Rs 10.2 million 

on grounds of unfair dismissal. 

A subsidiary is being sued by a client for breach of contract in respect of works carried out being faulty. 



111

Notice of Meeting 

Notice is hereby given that the annual meeting of shareholders of ENL Commercial Limited will be held 

at the Company’s registered office, 7 th Floor, Swan Group Centre, Intendance Street, Port Louis, on 

December 7, 2011 at 13.30 hours, to transact the following business: 

1 To consider the Annual Report for the year ended June 30, 2011. 

2 To receive the report of the auditors of the Company. 

3 To consider and approve the audited financial statements of the Company for the year ended June 30, 

2011. 

Ordinary Resolution 

“Resolved that the audited financial statements of the Company for the year ended June 30, 2011 be 

hereby approved.” 

4 To elect/re-elect one director, namely Mr Edouard Espitalier-Noël who retires by rotation in accordance 

with Section 24.5 of the Company’s constitution and, being re-eligible, offers himself for re-election. 


“Resolved that Mr Edouard Espitalier-Noël be hereby elected/re-elected as director of the Company in 

accordance with Section 24.5 of the Company’s constitution.” 

5 To take note of the automatic reappointment of BDO & Co. as auditors under Section 200 of the 

Companies Act 2001 and to authorise the Board to fix their remuneration. 


“Resolved that the automatic reappointment of the auditors under Section 200 of the Companies Act 

2001 be noted and that the Board be authorised to fix their remuneration.” 

Note: The profile and category of the director proposed for re-election are set out on pages 32 to 34 of the 

Annual Report 2011. 

By order of the Board 

ENL Limited 



A member of the Company entitled to attend and vote at this meeting may appoint a proxy, whether a member or 

not, to attend and vote on his/her behalf. Any such appointment must be made in writing on the attached form, and 

the document deposited at the Share Registry and Transfer Office of the Company, MCB Registry and Securities Ltd, 

Raymond Lamusse Building, 9-11 Sir William Newton Street, Port Louis, Mauritius not less than twenty-four hours before 

the meeting is due to take place. 

For the purpose of this annual meeting, the directors have resolved, in compliance with Section 120(3) of the Companies 

Act 2001, that the shareholders entitled to receive notice of the meeting and attend such meeting shall be those 

shareholders whose names are registered in the share register of the Company as at November 9, 2011. 

112 



Proxy Form 


I/We 

of 

being a member/s of ENL Commercial Limited, do hereby appoint 

of 

as my/our proxy or failing him/her 

of 

to vote for me/us on my/our behalf at the Annual Meeting of the Company to be held at 13.30 hours on 

December 7, 2011 and at any adjournment thereof. The proxy will vote on the under-mentioned resolution, 

as indicated: 

Resolutions 

(Please indicate with an X in the spaces below how you wish your votes to be cast) 

3 “Resolved that the audited financial statements of the Company 

for the year ended June 30, 2011 be hereby approved.” 

4 “Resolved that Mr Edouard Espitalier-Noël be hereby elected/ 

re-elected as director of the Company in accordance with 

Section 24.5 of the Company’s constitution.” 

5 “Resolved that the automatic reappointment of the auditors 

under Section 200 of the Companies Act 2001 be noted and 

that the Board be authorised to fix their remuneration.” 

For Against Abstain 

Signed this day of 2011 

Signature 

Notes 

1. A member may appoint a proxy of his own choice. Insert the name of the person appointed proxy in the space provided. 

2. If the appointor is a corporation, this form must be under its common seal or under the hand of some officer or attorney duly 

authorised in that behalf. 

3. In the case of joint holders, the signature of any one holder will be sufficient, but the names of all the joint holders should be stated. 

4. If this form is returned without any indication as to how the person appointed proxy shall vote, he will exercise his discretion as to how 

he votes or whether he abstains from voting. 

5. To be valid, this form must be completed and deposited at the Share Registry and Transfer Office of the Company, MCB Registry and 

Securities Ltd, Raymond Lamusse Building, 9-11 Sir William Newton Street, Port Louis, Mauritius not less than 24 hours before the 

time fixed for holding the meeting or adjourned meeting. 



113

114 



Notes 



115

116 




7 th Floor Swan Group Centre | 10, Intendance Street 

Port Louis | Mauritius 

T +230 213 3800 | F +230 208 0968 

info@enl.mu | www.enl.mu

enl commercial limited annual report 2011 - Investing In Africa

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