2012 Integrated report - Sappi

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Annexure A – Investments at September 2012 Set out below are the more significant subsidiaries and joint ventures or those that have a loan with the holding company, Sappi Limited: Investments in subsidiaries and joint ventures Share capital Effective holding 2012 % 2011 % Book value of investment 2012 ZAR million 2011 ZAR million Loan to subsidiary 2012 ZAR million 2011 ZAR million Loan from subsidiary 2012 ZAR million Southern Africa Sappi Southern Africa (Pty) Ltd O ZAR12,026,250 100 100 1,944 1,915 1,714 1,674 – – Sappi Share Facilitation Company (Pty) Ltd O ZAR1,000 100 100 – – 775 775 – – Usutu Forest Products Company Ltd O SZL10,000,000 100 100 – – – – – – Sappi Property Company (Pty) Ltd P ZAR7,000 100 100 – – – – – – Umkomaas Lignin (Pty) Ltd JV ZAR1,000 50 50 – – – – – – America SD Warren Company O US$1,000 100 100 – – – – (3) (20) Sappi Cloquet LLC O – (1) 100 100 – – – – – – Europe Sappi Alfeld GmbH O €31,200,000 100 100 – – – – – – Sappi Austria Produktions GmbH and CoKG O €35,000 100 100 – – – – – – Sappi Deutschland GmbH O €25,565 100 100 – – – – – – Sappi Ehingen GmbH O €20,800,000 100 100 – – – – – – Sappi Esus Beteiligungsverwaltungs GmbH H €1,000,000 100 100 – – – – – – Sappi Europe SA O €15,130,751 100 100 – – – – (2) (25) Sappi Finland Oy O €2,500 100 100 – – – – – – Sappi Fine Paper plc D GBP50,000 100 100 1 1 – – – – Sappi Holding GmbH H €72,700 100 100 16,288 16,288 – – – – Sappi International SA F €1,200,603,930 100 100 – – 40 38 – – Sappi Lanaken NV O €51,377,000 100 100 – – – – – – Sappi Lanaken Press Paper NV O €57,179,613 100 100 – – – – – – Sappi Maastricht BV O €31,992 100 100 – – – – – – Sappi Nijmegen BV O €59,037 100 100 – – – – – – Sappi Schweiz AG (2) O CHF10,000 – 100 – – – – – – Sappi Stockstadt GmbH O €40,000 100 100 – – – – – – Sappi Papier Holding GmbH O €72,700 100 100 – – 11 29 – – Sappi Trading Pulp AG O CHF100,000 100 100 – – – – – – PE Paper Escrow GmbH F €35,000 100 100 – – – – – – Sappi UK Ltd O GBP74,020,000 100 100 – – – – – – Asia Jiangxi Chenming Paper Co Ltd (2) JV RMB1,424,160,000 – 34 – – – – – – Other Lignin Insurance Co Ltd F US$656,000 100 100 3 3 – – – – Employee Share Participation Trusts – – 20 20 (20) (59) Various other companies – – – – – (6) Holding Companies Operating Companies Finance Companies Joint Venture Dormant Property Holding H O F JV D P (1) No issued share capital, only additional paid in capital of US$14 million. (2) Was sold in the 2012 financial year. 2011 ZAR million 18,236 18,207 2,560 2,536 (25) (110) 182
Glossary General definitions ABET – adult basic education and training AF&PA – American Forest and Paper Association air dry tons (‘ADT’) – meaning dry solids content of 90% and moisture content of 10% biofuels – organic material such as wood, waste and alcohol fuels, as well as gaseous and liquid fuels produced from these feedstocks when they are burned to produce energy black liquor – is the spent cooking liquor from the pulping process which arises when pulpwood is cooked in a digester thereby removing lignin, hemicellulose and other extractives from the wood to free the cellulose fibres. The resulting black liquor is an aqueous solution of lignin residues, hemicellulose, and the inorganic chemicals used in the pulping process. Black liquor contains slightly more than half of the energy content of the wood fed into the digester. bleached pulp – pulp that has been bleached by means of chemical additives to make it suitable for fine paper production CEPI – Confederation of European Paper Industries chemical oxygen demand (‘COD’) – the amount of oxygen required to break down the organic compounds in effluent chemical cellulose – highly purified chemical pulp derived from wood, intended primarily for conversion into chemical derivatives of cellulose and used mainly in the manufacture of viscose staple fibre, solvent spin fibre and filament. Also called dissolving wood pulp chemical pulp – a generic term for pulp made from wood fibre that has been produced in a chemical process CHP – combined heat and power coated papers – papers that contain a layer of coating material on one or both sides. The coating materials, consisting of pigments and binders, act as a filler to improve the printing surface of the paper coated mechanical – coated paper made from groundwood pulp which has been produced in a mechanical process, primarily used for magazines, catalogues and advertising material coated woodfree – coated paper made from chemical pulp which is made from wood fibre that has been produced in a chemical process, primarily used for high end publications and advertising material contractor – refers to an independent employer or self-employed person performing work for Sappi, excludes temporary or fixed-term employees corrugating medium – paperboard made from chemical and semi-chemical pulp, or waste paper, that is to be converted to a corrugated board by passing it through corrugating cylinders. Corrugating medium between layers of linerboard form the board from which corrugated boxes are produced COSO – the Committee of Sponsoring Organisations of the Treadway Commission CSI and CSR – corporate social investment and corporate social responsibility dissolving pulp – highly purified chemical pulp derived primarily from wood, but also from cotton linters intended primarily for conversion into chemical derivatives of cellulose and used mainly in the manufacture of viscose staple fibre, solvent spin fibre and filament dissolving wood pulp – highly purified chemical pulp derived from wood intended primarily for conversion into chemical derivatives of cellulose and used mainly in the manufacture of viscose staple fibre, solvent spin fibre and filament. Also called chemical cellulose elemental chlorine free (‘ECF’) – refers to bleaching sequences in which no chlorine is used energy – is present in many forms such as solar, mechanical, thermal, electrical and chemical. Any source of energy can be tapped to perform work. In power plants, coal is burned and its chemical energy is converted into electrical energy. To generate steam, coal and other fossil fuels are burned, thus converting stored chemical energy into thermal energy fibre – fibre is generally referred to as pulp in the paper industry. Wood is treated chemically or mechanically to separate the fibres during the pulping process fine paper – paper usually produced from chemical pulp for printing and writing purposes and consisting of coated and uncoated paper Forestry SA – largest forestry organisation representing growers of timber in South Africa FSC – in terms of the Forest Stewardship Council (‘FSC’) scheme, there are two types of certification. In order for land to achieve FSC endorsement, its forest management practices must meet the FSC’s ten principles and other assorted criteria. For manufacturers of forest products, including paper manufacturers like Sappi, Chain-of- Custody certification involves independent verification of the supply chain, which identifies and tracks the timber through all stages of the production process from the tree farm to the end product full-time equivalent employee – the number of total hours worked divided by the maximum number of compensable hours in a full-time schedule as defined by law Green-e ® – an independent consumer protection programme created by the Centre for Resource Solutions for the sale of renewable energy and greenhouse gas reduction (www.green-e.org) greenhouse gases (‘GHG’) – the GHGs included in the Kyoto Protocol are carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulphur hexafluoride HFO – heavy fuel oil ISO – developed by the International Standardisation Organisation (ISO), ISO 9000 is a series of standards focused on quality management systems, while the ISO 14001 series is focused on environmental performance and management JSE Limited – the main securities exchange in South Africa, previously known as the Johannesburg Stock Exchange kraft paper – packaging paper (bleached or unbleached) made from kraft pulp kraft pulp – chemical wood pulp produced by digesting wood by means of the sulphate pulping process Kyoto Protocol – a document signed by over 160 countries at Kyoto, Japan in December 1997 which commits signatories to reducing their emission of greenhouse gases relative to levels emitted in 1990 liquor – white liquor is the aqueous solution of sodium hydroxide and sodium sulphide used to extract lignin during kraft pulping. Black liquor is the resultant combination of lignin, water and chemicals Lost-Time Injury Frequency Rate (‘LTIFR’) = number of lost time injuries x 200,000 divided by man hours linerboard – the grade of paperboard used for the exterior facings of corrugated board. Linerboard is combined with corrugating medium by converters to produce corrugated board used in boxes managed forest – naturally occurring forests that are harvested commercially sappi Integrated Report 2012 183
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Sappi Group (Sappi Limited) INTEGRA
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About this report Introduction Our
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2012 was a year that positioned us
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global Sales by source 2012: US$6,3
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Non-financial highlights Specific p
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performance the region as a whole.
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The restructuring of our paper oper
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Group overview continued Q&A with R
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Focus on product development Produc
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4 electricity steam black liquor pu
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commitment Europe Our European empl
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iodiversity Sustainable fibre suppl
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Exciter value delivery was US$23.9
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market leaders > Print is particula
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Focus on innovation Knowledge, insi
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Pulp Share of sales paper pulp + di
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governance Deenadayalen (Len) Konar
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guidance Executive management Mark
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Review of operations Sappi Fine Pap
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streamlined The closure of the Bibe
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Focus on skills development Sappi c
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accelerate Capacity (’000) Divisi
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progress The year ahead The demand
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US$ million September 2012 Septembe
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Share statistics 2012 2011 2010 200
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Chief financial officer’s report
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positive Section 2 Financial perfor
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improvement Operating profit exclud
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cost reduction Taxation The tax exp
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service Sappi Fine Paper North Amer
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priority Section 4 Cash flow In the
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Defined benefit liabilities US$ mil
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Group debt profile We show the majo
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performance Section 6 Share price p
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Governance and compensation Corpora
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encourage Audit committee The audit
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Group IT steering committee The Gro
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During 2012 a board committee was e
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Governance element Principle Summar
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External assurance providers Report
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Principle Chapter 7 - Internal audi
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Stakeholder engagement report Sappi
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Compensation report The two large s
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strategic The primary components of
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Component Purpose Characteristics V
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competitive The policy on fatalitie
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empower Service contracts Mr Boëtt
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The dissolving wood pulp capacity c
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Focus on local communities Our busi
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Directors’ approval The directors
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Audit committee report for the year
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Directors’ report for the year en
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Group income statements for the yea
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Group statements of cash flows for
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Group income statements in Rands (c
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Group statements of cash flows in R
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Notes to the group annual financial
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Page 136 and 137: Notes to the group annual financial
Page 188 and 189: Glossary market pulp - pulp produce
Page 190 and 191: Glossary net operating assets - tot
Page 192 and 193: Notice to shareholders “Resolved
Page 194 and 195: Notice to shareholders “Resolved
Page 196 and 197: Notice to shareholders Annexure to
Page 198 and 199: Notice to shareholders The MOI prov
Page 200 and 201: Shareholder’s diary Annual genera
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Page 204 and 205: Notes to proxy The form of proxy mu
Page 206: Inspired to co-create We operate wi
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2012 Integrated report - Sappi

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