omnia holdings annual report 2010 omnia holdings annu

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16 OMNIA ANNUAL REPORT 2010 GROUP MANAGING DIRECTOR’S REPORT The effect of both declining commodity prices and the appreciation of the rand on the Group’s earnings, were highlighted during a year in which reduced demand for products in the declining agricultural, manufacturing and mining sectors placed pressure on margins and profitability. OUR STRATEGY Conditions continued to reflect the global recession that disrupted Omnia’s markets in 2009. The tough conditions were most keenly felt in the first half of the 2010 financial year. In the face of challenging conditions, the Omnia Group continued both to provide its customers with high-value customised solutions, and to invest for the future in its areas of expertise. To achieve this meant reducing the Group’s cost base and refocusing certain operating units in the chemicals business for greater effectiveness. We continued to make, and integrate, strategic acquisitions and partnerships aimed at strengthening Omnia’s position in significant market sectors. In the agricultural sector, the impact of the unusual buying patterns experienced in the first half of the 2009 financial year carried into the Group’s results for the 2010 financial year. As we reported last year, farmers stockpiled fertilizer in an attempt to avoid the run in prices over that six-month period. Prices tumbled as rapidly and unpredictably as they had risen, and the Group was left with substantial volumes of fertilizer stocks at the end of the prior financial period. Although this inventory was fairly valued at the time at R9,45 to the US dollar, raw material prices continued to decline and the strengthening of the rand to R7,29 to the US dollar resulted in material stock write-downs. The Group’s fertilizer stocks were devalued by R350 million by the interim stage of the 2010 financial year. Further devaluations, albeit to a lesser degree, of fertilizer stock took place after September. Within Protea Chemicals, a similar devaluation of polymer stocks resulted in trading at near zero margins and occasionally below original cost. By the end of September 2009, which marked the end of the first half of the 2010 financial year, there were signs of a slow economic recovery. Investing in our strategic position Notwithstanding the challenges presented by the unprecedented economic circumstances of the last 18 months, we have continued to position the Group for a future in which the global As a company which operates across defined economic sectors, each with its own distinctive characteristics, Omnia reinforces its competitive positioning by: Focusing on unique market offerings that create value and, in so doing, earn a premium. Providing specialised solutions to the chemical, mining and agricultural markets. Concentrating on growing its international business. Meeting international standards for Responsible Care in managing its operations.
OMNIA ANNUAL REPORT 2010 17 Notwithstanding the challenges presented by the unprecedented economic conditions of the last 18 months, the Group is confident it will reach its operational and financial targets in the current five-year cycle.
Page 1 and 2: OMNIA HOLDINGS ANNUAL REPORT 2010
Page 3 and 4: OMNIA’S MILESTONES 1976 1974 1972
Page 5 and 6: FINANCIAL HIGHLIGHTS Audited 31 Mar
Page 7 and 8: OUR VISION CREATING CUSTOMER WEALTH
Page 9 and 10: OMNIA ANNUAL REPORT 2010 5 The diff
Page 11 and 12: Participants were required to inves
Page 13 and 14: Statistical information 31 March 20
Page 15 and 16: The world today faces the compoundi
Page 17 and 18: OMNIA ANNUAL REPORT 2010 13 Omnia
Page 19: Rod Humphris (53) Executive directo
Page 23 and 24: (2009: 1 107,4 cents), and headline
Page 25 and 26: the best agronomic advice in all as
Page 27 and 28: OMNIA ANNUAL REPORT 2010 23 The sou
Page 29 and 30: Within the Chemicals Division produ
Page 31 and 32: Overview of Chemicals Protea Chemic
Page 33 and 34: MINING DIVISION - REVIEW OPERATIONA
Page 35 and 36: of ore. The risks normally associat
Page 37 and 38: Financial performance As expected,
Page 39 and 40: About this report This sustainabili
Page 41 and 42: highly productive lands are also mo
Page 43 and 44: - Vaal Triangle Priority Area Air M
Page 45 and 46: Challenges and opportunities Our re
Page 47 and 48: Corporate governance This corporate
Page 49 and 50: Board committees While the Board re
Page 51 and 52: The Group has made great strides in
Page 53 and 54: concern assumption at the interim r
Page 55 and 56: implemented to introduce a technolo
Page 57 and 58: There has been a marked improvement
Page 59 and 60: Social performance Recognising our
Page 61 and 62: for new students of a Certificate i
Page 63 and 64: To entrench these commitments throu
Page 65 and 66: At Omnia Fertilizer, all incidents
Page 67 and 68: Water Use Licence Application (IWUL
Page 69 and 70: FINANCIAL STATEMENTS A responsible
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REPORT OF THE AUDIT COMMITTEE for t
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DIRECTORS’ REPORT The directors a
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DIRECTORS’ SHAREHOLDING as at 31
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GROUP INCOME STATEMENT for the year
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GROUP STATEMENT OF CHANGES IN EQUIT
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NOTES TO THE GROUP FINANCIAL STATEM
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IAS 39, only certain, rather than a
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1.5 Cost of sales When inventories
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are presented in the income stateme
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fair value of plan assets, together
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1.22 Financial risk management 1.22
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2 PROPERTY, PLANT AND EQUIPMENT Fre
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2 PROPERTY, PLANT AND EQUIPMENT con
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4 AVAILABLE-FOR-SALE FINANCIAL ASSE
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8 STATED CAPITAL continued Number o
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13 INTEREST-BEARING BORROWINGS OMNI
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15 PROVISIONS OMNIA ANNUAL REPORT 2
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19 FINANCE EXPENSES OMNIA ANNUAL RE
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21 EARNINGS PER SHARE AND DIVIDENDS
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28 ACQUISITION OF BUSINESS OMNIA AN
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29 FINANCIAL RISK MANAGEMENT contin
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29 FINANCIAL RISK MANAGEMENT contin
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30 RELATED PARTY TRANSACTIONS conti
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32 RETIREMENT BENEFIT INFORMATION c
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OMNIA ANNUAL REPORT 2010 115 33 CON
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36 SHARE INCENTIVE SCHEME continued
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36 SHARE INCENTIVE SCHEME continued
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Country of incorporation Issued cap
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COMPANY INCOME STATEMENT for the ye
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COMPANY CASH FLOW STATEMENT for the
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SUMMARY OF SHAREHOLDER SPREAD at 31
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NOTICE TO SHAREHOLDERS for the year
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FORM OF PROXY For use at the annual
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ADMINISTRATION GROUP COMPANY SECRET
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