Securing Your World
G4S Security Services (Botswana) Limited ANNUAL REPORT 2008 Group profile
G4S Security Services (Botswana) Limited is the country’s leading provider of security solutions by way of an integrated security service comprising both human resources and technical products. G4S Security Services (Botswana) Limited is listed on the Botswana Stock Exchange. 70% of the issued shares are controlled by G4S plc.G4S plc is the world’s leading international security solutions group and is listed on the London Stock Exchange.
Range of security products
• Security alarms • Fire alarms • Time locks / time delays for safes and strongrooms • Access control • Guard patrol monitoring systems • CCTV systems • Vehicle tracking and fleet management systems • Smoke-box safes for transporting cash in vehicles • Safes
Range of specialised security services
• Secure monitoring and response • Vehicle tracking and mobile resource management • Cash logistics and cash management. • Scheduled or unscheduled technical support for the above product range • Specialised manned security, on-site personnel working with technological systems • Management of cash-handling and cash-processing centres • Integrated security solutions involving co-ordinated combinations of the above • Security training
Branches sub-branch • Gaborone (Head Office) Ramotswa • Francistown • Selebi-Phikwe • Lobatse • Palapye (excl. alarm response)
Postal address G4S Security Services (Botswana) Limited Phone: (+267) 391 2211, 393 9999 P.O. Box 1488 fax: (+267) 391 2779 Gaborone E-mail: [email protected] Botswana
Head office physical address Plot 20584 Western Bypass, Gaborone
Registered office address C/o PricewaterhouseCoopers (Pty.) Ltd. Plot 50371, Fairground Office Park, P.O. Box 294, Gaborone CONTENTS
Group profile Board of directors 2 - 3 Chairman’s report 4 -11 Management team 13 Directors’ report 14-16
GROUP ANNUAL FINANCIAL STATEMENTS
Contents Page Directors’ responsibility statement 18 Independent auditor’s report 19 Income statements 20 Balance sheets 21 Statements of changes in equity 22 Cash flow statements 23 Significant accounting policies 24 - 28 Notes to the group financial statements 29 - 41 Notice to shareholders 42 Form of proxy 43
G4S Security Services (Botswana) Limited Annual Report 2008 1 BOARD OF DIRECTORS
Percy Sekgomenyane Raditladi joined G4S Botswana as managing director in February 2008. He started his career in May 1998 with Debswana Diamond Company as a management trainee. In Lebang Mpotokwane joined INCO Holdings August 1999 he became managing director of (now G4S Security Services (Botswana) Ltd) as Yarona FM106.6, which he started while studying an executive director and a shareholder in 1989. at university, making it Botswana’s first private Willem Van de Ven has been with the G4S He has served as non-executive chairman of the commercial FM broadcasting radio station. He group since February 1993. He has served as the company since 1992. Mr. Mpotokwane has also joined Kgalagadi Breweries (KBL) in January 2003 Regional President of Africa (sub-Sahara) from been non-executive Chairman of Aon Botswana as a Management Trainee. In April 2004 he was April 2003. Formerly he was Managing Director and Associated Fund Administrators Botswana appointed Director, Corporate Affairs. At KBL G4S Netherlands from April 2001 to 2003 since 1991, and a director of Komatsu Botswana he held senior positions in marketing and human and Human Resource director from 1998 to since 1993. He previously served as Chairman resources and served in various SABMiller plc 2001 and Regional director (temporary agency of the University of Botswana Council, and as a projects. He served as director of The Business department) from 1992 to 1998. Mr. Van de director of Botswana Development Corporation; Place and Trustee of Kgalagadi Beverages Trust. He Ven was appointed a non-executive director of Debswana Diamond Company; Standard is a board member of G4S Botswana subsidiaries G4S Security Services (Botswana) Ltd in January Chartered Bank Botswana; PG Industries and Yarona FM. He graduated as a double major in 2004. He studied HR at the Social Academy in (Botswana); and Rural Industries Promotions Organisational Psychology and Industrial Sociology Eindhoven (NL) and Business Economics at the Company Botswana. from the University of Cape Town. University in Tilburg (NL).
2 G4S Security Services (Botswana) Limited Annual Report 2008 Robert Neil Matthews, retired partner of PricewaterhouseCoopers, Gaborone- in charge of the audit practice. He has been active, as Michael Kampani has been with the G4S group a qualified professional accountant, for over since April 1999. He started his G4S career 40 years both in practice and in the business in Malawi as Chief Accountant before joining sectors. He has been professionally involved Karel Meyer has been with the G4S group since G4S Botswana in June 2006 as Group Financial in Botswana from 1972 to 1986 and from February 1998. He is currently the Regional Controller and was appointed Financial Director 1996 to date serving in the profession with Managing Director for Southern and Central in December 2007. Prior to joining G4S he PricewaterhouseCoopers and in his own practice, Africa responsible for Botswana. Prior to his worked as management accountant and company and latterly, as a consultant. In this capacity current position he was the director responsible accountant for two leading Malawian companies he serves on a number of boards and audit for Mergers & Acquisitions and IT for G4S Africa over a five-year period. Mr. Kampani obtained committees. He has acted as honorary treasurer (sub-Saharan). He was the Regional Finance a B.Com degree in accountancy from the to BOCCIM, Kalahari Conservation Society and Director of Africa (sub-Saharan) from September University of Malawi in 1994 and qualified as a the Botswana Society and is a former board 1999 to 2006. He is a holder of Hons B.Compt Chartered Management Accountant in 1996. He is member of the Botswana Power Corporation. from UNISA. Mr Meyer was re-appointed Non- currently a member of the Chartered Institute of He is a Fellow of the Institute of Chartered executive director on 6 November 2008, having Management Accountants (UK), Botswana Institute Accountants in England and Wales, a Certified previously served in similar capacity from 1 of Accountants and the Society of Accountants in Public Accountant (USA) and a fellow (CPA) of October 2003 to 3 May 2007. Malawi. the Botswana Institute of Accountants.
G4S Security Services (Botswana) Limited Annual Report 2008 3 CHAIRMAN’S REPORT
Chairman: Lebang Mpotokwane
Summary of financial results
2008 2007 31 December 31 December
P’000 Change P’000 revenue 112,317 24.4% 90,280
Profit before taxation 22,009 25.9% 17,483 Net distributable profit 17,504 33.6% 13,103 Free cash flow as a % of earnings before interest and taxation 108.80% 44.1% 75.5%
Thebe Thebe earnings per share 218.80 33.6% 163.79
Total dividend per share (net) 107.95 22.1% 88.40
Company ownership structure
Through a shareholding of 70% of the issued shares, G4S Security Services (Botswana) Ltd. is part of the world’s leading security company, G4S plc. G4S plc is listed on the London Stock Exchange, operates in over 110 countries and employs more than 570,000 staff. G4S Security Services (Botswana) Limited therefore has access to world-class specialisation and expertise.
4 G4S Security Services (Botswana) Limited Annual Report 2008 FIVE YEAR HISTORY REVIEW OF THE
Revenue PAST YEAR
120 112.317 110 I am pleased to report on yet another
100 90.28 successful year for the company. 90 78.739 80 70 66.328 The company achieved good growth in 2008. 59.235 60 This was a particularly good achievement 50 Millions 40 given the unprecedented and unavoidable 30 increases in vehicle-related costs driven by 20 10 escalating crude oil prices. By the nature of 0 the company’s business, transport makes up a 2004 (15 months) 2005 2006 2007 2008 high proportion of its operational expenses.
The two product lines of Integrated Services Profit after tax (with specialised manned guarding) and Cash 20 17.504 Services under-performed due to increasing 18 labour and fuel costs. Alarm response 16 13.103 services performed exceptionally well, driven 14 12.706 12 11.109 by improved customer retention and revised 9.990 10 monitoring response rates. The division that
8
Millions operates in larger technological security and 6 safety systems was initially inhibited by the 4 absence of large projects in the market, but 2 recovered well in the closing months. 0 2004 (15 months) 2005 2006 2007 2008 The Botswana group continues to enjoy improved returns from investments through its access to the G4S group’s London treasury facility, which pays preferential rates of interest. These investments are denominated in Pula to avoid exchange rate risks.
G4S Security Services (Botswana) Limited Annual Report 2008 5 G4S ALARMS – Secure monitoring and response
This is Botswana’s market leader in the field of secure monitoring and response services with about 13,000 alarm sites under monitoring branches in Gaborone, Francistown, Lobatse, Ramotswa and Selebi-Phikwe. The national Control Centre in Gaborone meets international standards and receives alarm signals from throughout Botswana. Despite a very healthy rate of new alarm sales, strict credit control measures during the year reduced the rate of cumulative gain in comparison to earlier years.The introduction of advanced payment and strict credit control measures resulted in highly improved cash flow.
The Company anticipates real growth from both organic growth and diversification of control room functions. New technology now enables increasing forms of security solutions to be performed remotely.
G4S SYSTEMS – supply and support of technological safety and security systems
This division installs and maintains larger electronic systems such as fire detection, automatic fire suppression, advanced intruder alarms, CCTV, access control, time locks, and related electronic security and safety systems.
G4S Systems experienced a scarcity of major projects in the market during the early months, but saw improvements towards the end of the year. A number of restructuring initiatives were implemented during the year which included reduction in staffing levels to reduce overheads. The opportunities created by new technology, together with the need for customers to minimise costs while maintaining high levels of protection, give the directors confidence of improved results in 2009. Various options are being explored to further unlock value through outsourcing and contracting out some of the services.
G4S CASH SERVICES – Cash logistics and cash management
Although revenue increased, it was not matched by increased profit due to escalating fuel and labour costs. While cash logistics remains the core activity for this division, we have seen growth in the management of cash. The latter offers a complete end-to-end service including note sorting, cash distribution, wage packaging, payroll services and even ATM replenishment. Through the connection with G4S plc in the UK, the division is able to offer its Botswana clients the option of very high insurance levels for cash during transit.
The Company projects increased demand for cash-related services and anticipates steady growth in this division. The Company anticipates continued growth of the cash management business as more financial institutions opt to utilise the cash centre.
G4S INTEGRATED SERVICES – manned guarding in specialised applications
This trading division operates in the field of specialised manned security, with emphasis on staff training, focused supervision and integration with appropriate technology. Rapid developments in technology are creating increasing opportunities for guarding contracts to use technology in order to both reduce the recurrent cost of security while enhancing the effectiveness of the service.
The division’s performance did not meet management expectations. Loss of major contracts as well as lower-than- inflation pricing adjustment contributed to reduced margins. A number of cost cutting initiatives led to improved efficiencies in the division. A few major contracts only came on stream towards the end of the last quarter.
6 G4S Security Services (Botswana) Limited Annual Report 2008 Operational subsidiaries - contribution to profit before tax
2008 2007
Alarms Alarms Cash Services 39.1% Cash Services 36.9% 39.5% 43.5%
Guarding Guarding 21.3% 17.8%
Systems 0.1% Systems 1.8%
Acquisition of Filotto Falco Security (“FFS”) and Alidor Security Guard Training School and Agency (“Alidor”).
As announced in our Interim Financial Results for the six months ended June 2008 published on the 15th August 2008, the company on 1st August 2008 acquired the entire issued shares of Filotto Falco Security (Pty) Limited (“FFS”) and its subsidiary Alidor Security Guard Training School and Agency (Pty) Limited (Alidor) from Giuseppe Filotto and Bellinah Filotto for a cash consideration of BWP9.1 Million and BWP300 000 respectively.
FFS provides manned security and limited alarm monitoring services throughout Gaborone and Lobatse. It has been in operation in Botswana since 1982 originally as Vigilantes Security Services and has established a foothold in manned security guarding mainly in Gaborone. FFS has a broad customer base amongst retail chains, shopping malls, diplomatic missions, manufacturing industries, motor dealerships, banks and private individuals. FFS is one of the largest manned guarding security companies in Botswana. It employs 700 people and its annual sales for the year ended June 2008 were BWP16 million. The acquisition opens new opportunities for G4S Botswana in the small to medium manned security guarding contracts which the company has not been able to penetrate.
Given that the secure monitoring and cash logistics businesses are reaching maturity, the company will need to diversify into other product lines. In the short term, opportunities in manned guarding services still provide an attractive pipeline of business that cannot be ignored. With an estimated population of 25 000 manned guards in Botswana, G4S Botswana wants to be a significant player in this space. Privatization initiatives in the public service, especially the outsourcing of guarding of government buildings provides a viable opportunity. The acquisition of F.F.S, while increasing our exposure to the manned security guarding, leverages our scale. The combination of FFS operating with our guarding division will allow G4S Botswana to entrench its position in manned security guarding.
Operating in Tlokweng, Alidor holds a Botswana Training Authority (BOTA) security guards training accreditation, making it the only such facility in Botswana. G4S Botswana is facing a demand from customers to take a broader role in managing their risks. Security remains at the core of our business, an area in which we have an extensive amount of expertise. To cement our strength and move up the value chain, we will require a well trained security resource which is scarce in Botswana. Our trained workforce enable us to realise our strategy of partnering with our customers and take a greater responsibility for managing entire aspects of their security requirements which are not core to them. The BOTA accreditation will enable the company to apply for government training incentives such as training tax rebates.
The addition of the FFS product line to the business made a significant contribution to the division’s performance. The division is expected to improve performance in the coming year as the full impact of the acquisition is accounted for, in addition to the effects of new contracts as they come on stream. Operational efficiencies are also expected to improve as management entrench best practice systems in the operation.
G4S Security Services (Botswana) Limited Annual Report 2008 7 Board of Directors Mr Jan Vercueil resigned as alternate director to Mr. Willem Van de Ven on 6 November and was Mr. Percy Raditladi joined the company as Managing replaced by Mr. Diedrich Van As. Director on 4 February 2008. Mr. Raditladi has a BSosc (Organizational Psychology and Industrial Sociology) Dividend from the University of Cape Town, and while at university he founded Yarona FM 106.6, Botswana’s first The recommended final dividend of 69.70 thebe per private commercial radio station. He has a proven track share (net of tax), together with the interim dividend record in senior positions, including corporate affairs, of 38.25 thebe, amounts to a total dividend of 107.95 human resources, marketing and social responsibility thebe per share (net of tax) being covered 2 times by programs. I am pleased to report that he has already earnings. The final dividend as recommended by the made a positive impact on the business. Board on 26 February 2009 is payable on 3 April 2009 to shareholders registered as at 20 March 2009. Two long serving directors, Mr. Peter Stevenson and Mr. Michael Ward resigned on 17 March and 6 HIV/AIDS Policy November 2008 respectively. Mr. Stevenson served as non-executive director since the early 1990s and Mr. The company has continued to take a very active part Ward served as managing director from the company’s in the national programmes to combat and manage inception in the late 1980s until late 2003 and later as the HIV / AIDS pandemic. A general health-awareness an executive director. On behalf of the board and the program has been added to HIV-specific staff education, company, I thank them both for their long and dedicated counselling, and on-site testing. service and wish them well in their future endeavours. Mr. Robert Neil Matthews was appointed in Mr. Stevenson’s place on the 14th August 2008.
Mr. Diedrich Van As resigned as non-executive director on 6 November 2008 and Mr Karel Meyer was appointed in his place.
8 G4S Security Services (Botswana) Limited Annual Report 2008 Fanuel Kenosi from G4S 4 teen Programme
Social responsibility programmes
The G4S group places a high priority on social responsibility wherever it operates, and G4S Botswana has actively embraced this philosophy.
In 2006 G4S undertook a worldwide search for a group of 14 young talented athletes with a view to indentifying a team that would be part of the G4S 4 teen Programme. This innovative global sports programme aims to support the next generation of sports stars as they seek to fulfil their potential on sport’s biggest stages over the coming years. Through the Botswana National Olympics Committee (BNOC) along with the Botswana Athletics Association (BAA), a young Botswana athlete, Fanuel Kenosi, was identified as the G4S 4 teen sporting ambassador for Botswana.
In addition to receiving financial support, Fanuel has been getting a wealth of training to mould him into a Professional Athlete. G4S has organised workshops which include nutrition training, motivational sessions and media training with BBC commentator Paul Dickenson. The confidence built up from these sessions has resulted in Fanuel’s professional growth, and he was recently nominated by the International Association of Athletics Federation (IAAF) to benefit from the High Performance Training Centre in Dakar Senegal. This centre provides excellent facilities for the training and development of both international class athletes and coaches. The programme has benefited numerous sprinters, including the likes of Asafa Powell, previous world record holder for 100m.
Not only is Fanuel a promising sprinter, but he also demonstrates the G4S values of integrity, teamwork, expertise and performance; values essential to developing and competing at the highest level of both sport and business. When the G4S 4 teen programme was launched in 2007 its biggest objective was to offer athletes support towards the London 2012 Olympics, but Fanuel has already participated in the Beijing 2008 Olympics, where he demonstrated very promising performance. The G4S 4 teen project will run for a period of six years and through assistance of G4S we are confident that he will be able to participate in the 2010 Commonwealth Games in New Dehli and the 2012 Olympics in London.
G4S Security Services (Botswana) Limited Annual Report 2008 9 Environmental awareness
G4S plc maintains strict policies in respect of environmental protection, including adherence to all applicable recognised standards in this regard. G4S Security Services (Botswana) Limited complies with all such policies.
Corporate governance
The company has adopted the King Commission code of practice on Corporate Governance.
In addition to the above, G4S’s global standards require, internal financial reviews and a bi-annual detailed assessment of corporate governance and management of contingent risk. The company has in place policies and procedures to guard against abuse of information and insider trading, together with plans for corporate disaster recovery.
Removing “Group 4 Securicor” from the Brand Icon
As the group strategy has developed by moving towards outsourcing solutions and away from commodity, low-value security services, a change of approach is required. Whilst the group is proud of its heritage, it feels that the wording, “Group 4 Securicor “is holding back the brand and not allowing it to move on with strategy. Therefore the wording began to be removed from the Brand in January 2009 with the goal of completely removing the wording across the world by the end of 2010.
Securing Your World
G4S’ purpose statement will further change from “A world of Security Solutions” to “ Securing Your World” as the Company transforms itself to a fully secure security solutions service provider.
10 G4S Security Services (Botswana) Limited Annual Report 2008 Prospects
2009 is going to be a challenging year as the full impact of the global economic crisis are felt within the local economy. Government anticipates running a record P13 billion budget deficit during the coming year as demand for diamonds has reduced by almost 50 per cent.
The directors anticipate reduced consumer spending and layoffs throughout the economy with a dampening effect on our ability to maintain prices. The economic down turn also presents an opportunity to restructure the operations and improve efficiencies. In view of these challenges, plans are at an advanced stage to rollout a fleet management technology which will significantly reduce vehicle costs. Further cost-effective technologies will be deployed during the year to improve the company’s operational agility.
The board has approved the amalgamation of all operating subsidiaries into one operating entity. This will provide a tax efficient structure and reduce the administrative burden of maintaining and managing independent subsidiaries. Further announcements will be made during the coming year after obtaining the necessary regulatory approvals.
In line with G4S plc group strategy, G4S Botswana will transform over the next few years as it moves into a fully fledged secure solutions security service provider. Opportunities will be explored including acquisitions and green field products in secure logistics, document and data storage, facilities management and security services consulting.
While remaining wary of the possible economic effect of the global credit crunch and their direct impact on the company itself, the directors are confident that real growth will be sustained in 2009.
Acknowledgement
I now extend the warm commendations of the directors to management and staff of the company for their excellent performance under very difficult trading conditions in 2008.
L.M. Mpotokwane Chairman
26 February 2009
G4S Security Services (Botswana) Limited Annual Report 2008 11 G4S plc is a global company operating in over 110 countries across the world. Employing 2600 people, G4S Security Services (Botswana) Ltd operates in the field of technology-based security, with a view to offering the market an entire and integrated security service.
12 G4S Security Services (Botswana) Limited Annual Report 2008 THE MANAGEMENT TEAM
Percy Raditladi Managing Director
Michael Kampani Ishmael Dipholo Ben Loots Financial Director Human Resources Manager General Manager: G4S Integrated Services
Ndiko Tapela Mahube Skyler Clayton Molefe Matlhape General Manager: G4S Cash Services Head of Sales & Marketing General Manager: G4S Systems
G4S Security Services (Botswana) Limited Annual Report 2008 13 DIRECTORS’ REPORT
Mr. Lebang Mpotokwane Percy Raditladi Chairman Managing Director
The board of directors is pleased to submit its report and the audited financial statements of the company for the year ended 31 December 2008.
Nature of business
G4S Security Services (Botswana) Limited owns and provides administration services to a group of separate businesses, each of which trades under its own name. The present portfolio of activities is described in the Chairman’s Report.
Financial statements
G4S Security Services (Botswana) Limited’s financial statements for the year ended 31 December 2008 are set out on pages 20 to 41, and are considered by the directors to fairly and adequately disclose the financial position and the results of the group. These statements were approved by the board of directors on 26 February 2009, and are signed on its behalf by Mr. L.M. Mpotokwane and Mr. P.S. Raditladi.
Subsidiaries
The following are all wholly owned subsidiaries of G4S Security Services (Botswana) Limited:
Subsidiary Business activity
Automated Security (Pty) Ltd t/a G4S Alarms Secure monitoring and response and t/a G4S Integrated Services Specialised guarding services working with technology
14 G4S Security Services (Botswana) Limited Annual Report 2008 Subsidiary Business activity
Installec (Pty) Ltd Technical support to G4S Alarms, advanced t/a G4S Systems security alarms, fire alarms, time locks, safes, access control, CCTV, fire alarms and related security products.
Security Express (Pty) Ltd Cash logistics t/a G4S Cash Services
Filotto Falco Security (Pty) Ltd Manned guarding
Alidor Security Guard Training School & Agency (Pty) Ltd Security training
Share capital
There were no changes in the authorised and issued share capital during the year.
Dividend
The recommended final dividend of 69.70 thebe per share, together with the interim dividend of 38.25 thebe per share constitutes a total dividend for the year of 107.95 thebe per share (net of withholding tax). The dividend is covered 2 times by earnings of 218.80 thebe per share. The total dividend for 2007 was 88.40 thebe per share (net of tax).
Directors
The current board of directors is made of the following:
Name Board position Country of nationality Mr. L.M. Mpotokwane Chairman – non-executive Botswana Mr. P.S. Raditladi Managing Director Botswana Mr. M.L. Kampani Financial Director Malawi Mr. R.N. Matthews Non-executive UK Mr. W.A.H van de Ven Non-executive appointee of G4S plc Netherlands Mr. K. Meyer Non-executive appointee of G4S plc South Africa
Board committees
In order to assist the Board in discharging its duties, the following committees were operational during the year.
Audit Committee
The committee continuously reviews reports on the management of internal controls, risk management and management of accounts. It also reviews the audited annual financial statements and makes recommendation for their approval by the Board.
Remuneration Committee
The function of the committee is to advise the Board on remuneration of executive directors and management.
G4S Security Services (Botswana) Limited Annual Report 2008 15 Directors’ personal shareholdings
Number of shares held at 31 December 2008 December 2007 L.M. Mpotokwane 154,497 154,497
Major shareholder Number of shares held at 31 December 2008 December 2007 Securicor International plc 5,600,000 5,600,000 Botswana Insurance Fund Management Ltd. 857,377 859,663
Secretaries PricewaterhouseCoopers (Pty) Ltd
Registered office C/o PricewaterhouseCoopers (Pty) Ltd Plot 50371, Fairground Office Park, Gaborone
Auditors KPMG
Bankers Barclays Bank of Botswana Limited Standard Chartered Bank Botswana Limited first National Bank of Botswana Limited Stanbic Bank Botswana Limited
Annual General Meeting The 2008 Annual General Meeting has been scheduled for Thursday 23 April 2009 at Gaborone Sun Hotel, commencing at 4.30pm.
For and on behalf of the Board of Directors
L.M. Mpotokwane (Chairman) P.S. Raditladi (Managing Director) Gaborone
26 February 2009
16 G4S Security Services (Botswana) Limited Annual Report 2008 G4S SECURITY SERVICES (BOTSWANA) LIMITED Group annual financial statements for the year ended 31 December 2008
Contents Page
Directors’ responsibility statement 18 Independent auditor’s report 19 Income statements 20 Balance sheets 21 Statements of changes in equity 22 Cash flow statements 23 Significant accounting policies 24 - 28 Notes to the group financial statements 29 - 41 Notice to shareholders 42 Form of proxy 43
G4S Security Services (Botswana) Limited Annual Report 2008 17 DIRECTORS’ RESPONSIBILITY STATEMENT for the year ended 31 December 2008
The directors are responsible for the preparation and fair presentation of the annual group financial statements, comprising the balance sheets at 31 December 2008, and the income statements, the statements of changes in equity and cash flow statements for the year then ended, and the notes to the financial statements, and a summary of significant accounting policies and other explanatory notes, in accordance with International Financial Reporting Standards and in the manner required by the Companies Act, 2003 (No. 32 of 2004) of Botswana.
The directors’ responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of these financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies, and making accounting estimates that are reasonable in the circumstances.
The directors’ responsibility also includes maintaining adequate accounting records and an effective system of risk management.
The directors have made an assessment of the company’s and group’s ability to continue as going concerns and have no reason to believe these entities will not continue as going concerns in the foreseeable future.
The auditor is responsible for reporting on whether the annual financial statements are fairly presented in accordance with the applicable financial reporting framework.
Approval of the annual financial statements:
The annual group financial statements were approved by the directors on 26 February 2009 and are signed on their behalf by:
Chairman Managing Director
18 G4S Security Services (Botswana) Limited Annual Report 2008 KPMG Certified Public Accountants Telephone +267 391 2400 Fax +267 397 5281 Plot 67977, Off Tlokweng Road Internet http://www.kpmg.com/ PO Box 1519, Gaborone, Botswana
INDEPENDENT AUDITOR’S REPORT to the members of G4S Security Services (Botswana) Limited
Report on the Financial Statements We have audited the consolidated and separate financial statements of G4S Security Services (Botswana) Limited, set out on pages 20 to 41 which comprise the balance sheets as at 31 December 2008, and the income statements, statements of changes in equity and cash flow statements 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 the manner required by the Companies Act, 2003 (No. 32 of 2004) of Botswana. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditor’s 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 misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the group’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 group’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the 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 present fairly, in all material respects the financial position of G4S Security Services (Botswana) Limited and the group as of 31 December 2008, and of the Company and group’s financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards and in the manner required by the Companies Act, 2003 (No. 32 of 2004) of Botswana.
KPMG
26 February 2009
KPMG, a partnership domiciled in Botswana and a member firm of AG Devin* NP Dixon-Warren FJ Roos** the KPMG network of independent member firms affiliated with *British ** South African KPMG International, a Swiss cooperative VAT Number P03623901112
G4S Security Services (Botswana) Limited Annual Report 2008 19 INCOME STATEMENTS for the year ended 31 December 2008 In Pula
Group Company
Note 2008 2007 2008 2007 Restated Restated
Revenue 1 112 316 580 90 279 764 - -
Cost of sales (67 503 971 ) (52 205 080 ) - -
Gross profit 44 812 609 38 074 684 - -
Other income 902 140 370 188 5 256 260 4 202 285 Administrative expenses (25 455 824 ) (21 940 270 ) (5 067 681 ) (3 536 363 )
Profit from operations 2 20 258 925 16 504 602 188 579 665 922 Finance expense 4 (552 045 ) (566 283 ) - - Income from investments 5 2 301 781 1 545 118 10 530 597 9 086 719
Profit before taxation 22 008 661 17 483 437 10 719 176 9 752 641 Income taxation expense 6 (4 504 469 ) (4 380 140 ) (1 581 999 ) (1 665 708 )
Profit for the year 17 504 192 13 103 297 9 137 177 8 086 933
Earnings per share (thebe) 7 218.80 163.79
Dividends per share (thebe) (net of tax) 8 107.95 88.40
20 G4S Security Services (Botswana) Limited Annual Report 2008 BALANCE SHEETS as at 31 December 2008 In Pula
Group Company Note 2008 2007 2008 2007
Assets
Property, plant and equipment 9 17 902 982 17 209 774 6 691 834 7 111 331 Goodwill 10 9 715 123 - - - Deferred taxation 17 201 319 - - - Interest in subsidiary companies 11 - - 12 103 915 1 127 675
Total non-current assets 27 819 424 17 209 774 18 795 749 8 239 006
Inventories 12 1 845 948 3 303 769 - - Trade and other receivables 13 14 109 829 12 995 539 122 646 192 419 Amounts due from related parties 14 14 211 252 10 970 844 14 211 252 10 970 844 Amounts due from subsidiaries 11 - - 3 401 705 5 603 785 Cash and cash equivalents 15 5 018 771 6 441 862 46 148 9 635
Total current assets 35 185 800 33 712 014 17 781 751 16 776 683
Total assets 63 005 224 50 921 788 36 577 500 25 015 689
Equity Stated capital 16 1 804 557 1 804 557 1 804 557 1 804 557 Dividend reserve 5 576 000 4 352 000 5 576 000 4 352 000 Retained earnings 39 387 147 30 518 955 6 779 871 6 278 694
Total equity 46 767 704 36 675 512 14 160 428 12 435 251
Interest bearing borrowings 18 3 470 989 3 075 591 - - Deferred taxation 17 - 456 727 36 355 91 231
Total non-current liabilities 3 470 989 3 532 318 36 355 91 231
Trade and other payables 19 11 679 638 9 728 723 930 244 707 737 Taxation 244 462 254 748 306 713 345 603 Amounts due to subsidiaries 11 - - 20 956 176 11 435 867 Interest bearing borrowings 18 654 847 730 487 - - Amounts due to related parties 20 187 584 - 187 584 -
Total current liabilities 12 766 531 10 713 958 22 380 717 12 489 207
Total equity and liabilities 63 005 224 50 921 788 36 577 500 25 015 689
G4S Security Services (Botswana) Limited Annual Report 2008 21 STATEMENTS OF CHANGES IN EQUITY for the year ended 31 December 2008 In Pula
Group Stated Share Dividend Retained capital premium reserve earnings Total
Balance at 1 January 2007 800 000 1 004 557 4 080 000 24 487 658 30 372 215 Transfer of share premium to stated capital 1 004 557 (1 004 557 ) - - - Profit for the year (restated) - - - 13 103 297 13 103 297 Dividends paid (restated) - - (4 080 000 ) (2 720 000 ) (6 800 000 ) Dividends proposed - - 4 352 000 (4 352 000 ) -
Balance at 31 December 2007 1 804 557 - 4 352 000 30 518 955 36 675 512 Profit for the year - - - 17 504 192 17 504 192 Dividends paid - - (4 352 000 ) (3 060 000 ) (7 412 000 ) Dividends proposed - - 5 576 000 (5 576 000 ) -
Balance at 31 December 2008 1 804 557 - 5 576 000 39 387 147 46 767 704
Company Stated Share Dividend Retained capital premium reserve earnings Total
Balance at 1 January 2007 800 000 1 004 557 4 080 000 5 263 761 11 148 318 Transfer of share premium to stated capital 1 004 557 (1 004 557 ) - - - Profit for the year (restated) - - - 8 086 933 8 086 933 Dividends paid (restated) - - (4 080 000 ) (2 720 000 ) (6 800 000 ) Dividends proposed - - 4 352 000 (4 352 000 ) -
Balance at 31 December 2007 1 804 557 - 4 352 000 6 278 694 12 435 251 Profit for the year - - - 9 137 177 9 137 177 Dividends paid - - (4 352 000 ) (3 060 000 ) (7 412 000 ) Dividends proposed - - 5 576 000 (5 576 000 ) -
Balance at 31 December 2008 1 804 557 - 5 576 000 6 779 871 14 160 428
22 G4S Security Services (Botswana) Limited Annual Report 2008 CASH FLOW STATEMENTS for the year ended 31 December 2008 In Pula
Group Company Note 2008 2007 2008 2007 Operating activities Profit from operations 20 258 925 16 504 602 188 579 665 922 Adjusted for: Depreciation 4 502 477 4 036 487 426 976 391 732 Change in impairment provision on trade receivables 1 837 786 (2 546 928 ) - - Profit on disposal of property, plant and equipment (966 301 ) (106 306 ) (724 566 ) - Operating profit / (loss) before changes in working capital 25 632 887 17 887 855 (109 011 ) 1 057 654
Change in subsidiary company balances - - 11 722 389 3 458 897 Change in net amounts due from related companies (3 052 824 ) (7 314 548 ) (3 052 824 ) (7 128 213 ) Change in inventories 1 457 821 (910 490 ) - - Change in trade and other receivables (2 952 076 ) 1 781 516 69 773 (168 239 ) Change in trade and other payables 1 950 915 (1 112 961 ) 222 507 517 559 Cash generated from/(used in) operating activities 23 036 723 10 331 372 8 852 834 (2 262 342 ) Dividends paid 22 (7 412 000 ) (6 800 000 ) (7 412 000 ) (6 800 000 ) Taxation paid 21 (5 172 801 ) (5 213 026 ) (1 675 765 ) (1 290 031 ) Cash generated from/(used in) operating activities 10 451 922 (1 681 654 ) (234 931 ) (10 352 373 )
Investing activities Interest received 2 301 781 1 545 118 1 810 597 1 086 719 Acquisition of plant and equipment (5 841 741 ) (5 378 227 ) (493 825 ) (99 282 ) Investments in subsidiaries (9 715 123 ) - (10 976 240 ) - Dividends received - - 8 720 000 8 000 000 Proceeds on disposal of property, plant and equipment 1 612 357 221 775 1 210 912 - Cash (used in)/generated from investing activities (11 642 726 ) (3 611 334 ) 271 444 8 987 437
Financing activities Finance costs (552 045 ) (566 283 ) - - Interest bearing borrowings raised 2 674 708 3 174 929 - - Capital repayments of interest bearing borrowings (2 354 950 ) (2 398 805 ) - - Cash (used in)/generated from financing activities (232 287 ) 209 841 - - Net (decrease)/increase in cash and cash equivalents (1 423 091 ) (5 083 147 ) 36 513 (1 364 936 ) Cash and cash equivalents at beginning of year 6 441 862 11 525 009 9 635 1 374 571 Cash and cash equivalents at end of year 5 018 771 6 441 862 46 148 9 635
G4S Security Services (Botswana) Limited Annual Report 2008 23 SIGNIFICANT ACCOUNTING POLICIES for the year ended 31 December 2008
The consolidated financial statements of the company for the year ended policies of an investee enterprise so as to obtain benefits from its activities. 31 December 2008 comprises the company and its subsidiaries In assessing control, potential voting rights that are presently exercisable (together referred to as the “group”). are taken into account.
Statement of compliance Subsidiaries are consolidated from the date on which control is transferred to the group. Consolidation of the subsidiary results are ceased from The financial statements have been prepared in accordance with the date that control ceases. The purchase method of accounting is International Financial Reporting Standards and the requirements of the used to account for acquisition of subsidiaries. Intra-group balances and Companies Act, 2003 (No. 32 of 2004) of Botswana. any unrealised gains and losses or income and expenses arising from intra-group transactions are eliminated in preparing consolidated financial Basis of preparation statements.
The financial statements are prepared in Botswana Pula, which is the Recognition and de-recognition of assets and liabilities group’s functional currency. The financial statements have been prepared on the historic cost basis, adjusted for fair value presentation in respect of The group recognises an asset when it obtains control of a resource as a financial instruments and incorporate the following principal accounting result of past events and future economic benefits are expected to flow to policies which are consistent with those applied in the previous financial the group. The group de-recognises a financial asset when it loses control year. over the contractual rights that comprise the asset and consequently transfers the substantive risks and benefits associated with the asset. A The preparation of financial statements in conformity with International financial liability is de-recognised when it is legally extinguished. Financial Reporting Standards requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and Property, plant and equipment disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses Items of property, plant and equipment are stated at cost less accumulated during the reporting period. Although the estimates are based on depreciation and impairment losses. Freehold land is not depreciated. management’s best knowledge of current events and actions, actual results may ultimately differ from those estimates. Depreciation Depreciation is charged to the income statement on a straight-line basis The estimates and underlying assumptions are reviewed on an ongoing over the estimated useful lives of items of property, plant and equipment. basis. Revisions to accounting estimates are recognised in the period in The rates used are as follows: which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both • Freehold buildings 50 years current and future periods. In particular, information about significant areas • Leasehold land and buildings Period of the lease of estimation uncertainty and critical judgements in applying accounting • Leasehold improvements 5 - 6 years policies that have the most significant effect on the amount recognised in • Furniture, fittings and equipment 5 - 10 years the financial statements are described in notes 9, 10 and 24. • Motor vehicles and accessories 4 years • Radio and alarm equipment 2 - 10 years Basis of consolidation The residual values, depreciation methods and useful lives are reassessed Subsidiaries, which are those entities in which the group has an interest of annually. more than 50% of the voting rights or otherwise has the power to govern the financial and operating policies, are consolidated. Control is achieved where the company has the power to govern the financial and operating
24 G4S Security Services (Botswana) Limited Annual Report 2008 SIGNIFICANT ACCOUNTING POLICIES (continued) for the year ended 31 December 2008
Impairment a reliable estimate can be made of the amount of the obligation. Where the effect of discounting is material, provisions are discounted. The discount The carrying values of assets are reviewed for impairment when events rate used is the pre-tax rate that reflects current market assessment of or changes in circumstances indicate the carrying value may not be the time value of money and, where appropriate, the risks specific to the recoverable. If any such indication exists and where the carrying values liability. exceed the estimated recoverable amount, the assets or cash-generating units are written down to their recoverable amount. The recoverable Taxation amount of an asset is the greater of net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted Income tax to their present value using a pre-tax discount rate that reflects current Income tax on the profit for the year comprises current and deferred tax. market assessments of the time value of money and the risk specific to the asset. For an asset that does not generate largely independent cash inflows, Current tax is the expected tax payable on the taxable income for the the recoverable amount is determined for the cash-generating unit to year, using tax rates enacted or substantially enacted at the balance sheet which the asset belongs. Impairment losses are recognised in the income date, after taking account of income and expenditure which is not subject statement. to taxation and any adjustment to tax payable in respect of previous years.
Where an impairment loss subsequently reverses, the carrying amount Dividends are declared and paid net of 15% withholding tax which is of the asset (cash generating unit) is increased to the revised estimate already deducted on dividends received from the subsidiary companies. of its recoverable amount so that the increased carrying amount does not exceed the carrying amount that would have been determined had Deferred tax no impairment loss been recognised for the asset (cash generating unit) Deferred tax is provided using the balance sheet liability method, providing in prior years. A reversal of impairment loss is recognised as income for temporary differences between the carrying amounts of assets and immediately unless the relevant asset is carried at a revalued amount in liabilities for financial reporting purposes and the amounts used for which case the reversal of the impairment loss is treated as an increase in taxation purposes. The amount of deferred tax provided is based on the the revaluation reserve. expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantially enacted at the Inventories balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which Inventories are stated at the lower of cost and net realisable value. Net the unused tax losses and credits can be utilised. Deferred tax assets are realisable value is the estimated selling price in the ordinary course of reduced to the extent that it is no longer probable that the related tax business, less the estimated costs of completion and selling expenses. benefit will be realised.
The cost of inventories is based on the weighted average cost principle Financial instruments and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and condition. Obsolete, redundant and Financial assets slow moving inventories are identified on a regular basis and are written The group’s principal financial assets comprise of the following: down to their estimated net realisable values. Cash and cash equivalents Provisions Cash and cash equivalents are defined as cash on hand, demand deposits and short-term highly liquid investments readily convertible to known A provision is recognised when the group has a legal or constructive amounts of cash and subject to insignificant risk of changes in value. obligation as a result of a past event, for which it is probable that an outflow of economic benefits will be required to settle the obligation and
G4S Security Services (Botswana) Limited Annual Report 2008 25 SIGNIFICANT ACCOUNTING POLICIES (continued) for the year ended 31 December 2008
Trade and other receivables Foreign currency transactions Trade and other receivables, which generally have 30 to 90 day terms, are recognised and carried at original invoice amount less impairment losses. Transactions in foreign currencies are translated to Pula at the foreign Impairment losses are recognised in the income statement when collection exchange rate ruling at the date of the transaction. Monetary assets and of the full amount is no longer probable. liabilities denominated in foreign currencies at the balance sheet date are translated to Pula at the foreign exchange rate ruling at that date. Foreign Amounts due from related parties and subsidiaries exchange differences arising on transactions are recognised in the income The amounts due from the related parties and subsidiaries are recognised statement. at original invoice amount, being the fair value of the consideration paid or value of services rendered to the related parties. Finance costs
Financial liabilities Finance costs are recognised in the income statement in the period in The group’s principal financial liabilities comprise the following: which they are incurred. All finance costs are recognised in the income statement using the effective interest rate method. Trade and other payables Liabilities for trade and other amounts payable which are normally settled Leasing on 30 to 90 day terms are carried at cost which is the fair value of the consideration to be paid in the future for goods and services received, Leases are classified as finance leases whenever the terms of the lease whether or not billed to the group. transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. Assets held under finance Interest bearing borrowings leases are recognised as assets of the company at their fair value at the Interest bearing borrowings comprise finance lease obligations. Finance date of acquisition. The corresponding liability to the lessor is included lease obligations are recorded at the proceeds received, net of direct issue in the balance sheet as a finance lease obligation. Finance costs, which costs. Finance charges are accounted for on an accrual basis and are added represent the difference between the total leasing commitments and the to the carrying amount of the instrument to the extent that they are not fair value of the assets acquired, are charged to the income statement over settled in the period in which they arise. the term of the relevant lease so as to produce a constant periodic rate of charge on the remaining balance of the obligations for each accounting Amounts due to related parties and subsidiaries period. The amounts due from the related parties and subsidiaries are recognised at original invoice amount, being the fair value of the consideration paid or Rentals payable under operating leases are charged to the income value of services rendered to the related parties. statement on a straight-line basis over the term of the relevant lease.
Gains and losses on subsequent measurement Revenue Gains and losses arising from a change in the fair value of financial instruments are included in the income statement in the period in which Revenue is measured at the fair value of the consideration received the change arises. or receivable for goods and services provided in the normal course of business. Offset Financial assets and financial liabilities are offset and the net amount Revenue from the sale of goods is exclusive of VAT and discounts granted reported in the balance sheet when the company has a legally enforceable and are recognised in the income statement when the following conditions right to set off the recognised amounts, and intends either to settle on a have been satisfied: net basis, or to realise the asset and settle the liability simultaneously. • The group has transferred to the buyer the significant risks and rewards of ownership of the goods;
26 G4S Security Services (Botswana) Limited Annual Report 2008 SIGNIFICANT ACCOUNTING POLICIES (continued) for the year ended 31 December 2008
• The group retains neither continuing managerial involvement to the earnings of members into a separate entity (a fund) and will have no degree usually associated with ownership nor effective control over legal or constructive obligations to pay further contributions if the fund the goods sold; does not hold sufficient assets to pay all employees benefits relating to • The amount of revenue can be measured reliably; employee service in the current and prior periods. Permanent citizen • It is probable that the economic benefits associated with the employees who are not members of the pension fund are entitled transaction will flow to the group; and to severance benefits calculated in accordance with current labour • The costs incurred or to be incurred in respect of the transaction can regulations in Botswana. be measured reliably. Payments to defined contribution retirement pension plans are charged as Revenue from rendering of services is exclusive of VAT and discounts an expense to the income statement as they fall due. granted and are recognised in the income statement when the following conditions have been satisfied: Goodwill • The amount of revenue can be measured reliably; • The stage of completion of the transaction at the balance sheet date Goodwill represents the excess of the cost of the acquisition over the can be measured reliably; group’s interest in the net fair value of the identifiable assets, liabilities and • It is probable that the economic benefits associated with the contingent liabilities of the acquiree. transaction will flow to the group; and • The costs incurred or to be incurred in respect of the transaction Subsequent measurement can be measured reliably. Goodwill is measured at cost less accumulated impairment losses. Goodwill is allocated to cash generating units and is tested annually for Interest received impairment.
Interest received is accrued on a time basis, by reference to the principal New standards and interpretations not yet adopted outstanding and the interest rate applicable, which is the rate that discounts estimated future cash receipts through the expected life of the • IFRS 8 Operating Segments sets out requirements for disclosure of financial asset to that asset’s net carrying amount. information about an entity’s operating segments and also about the entity’s products and services, the geographical areas in which it Dividends operates, and its major customers. IFRS 8, which becomes mandatory for the group’s 2009 financial statements, will require additional Dividends proposed after the balance sheet date are shown as a disclosure in respect of the security services in which the individual component of equity. Taxation credits on dividends are dealt with in the subsidiary companies specialises. income statement in the year in which the dividends are declared. • IFRS 2 Share-based payment: Vesting conditions and cancellations Dividend income from investments is recognised when the shareholders’ (amendment). The amendments apply to equity-settled share-based rights to receive payment have been established. payment transactions and clarify the meaning of vesting and “non- vesting conditions”, and the accounting treatment where either the Employee benefits entity or the beneficiary of a grant chooses not to meet the vesting conditions. The revised IFRS 2 which becomes mandatory for the The group operates a defined contribution plan for its eligible permanent group’s 2010 financial statements is not expected to have any impact citizen employees. The fund is registered under the Pension and Provident on the financial statements of the group. Funds Act (Chapter 27.03). A defined contribution plan is a pension plan under which the company pays fixed contributions based on pensionable
G4S Security Services (Botswana) Limited Annual Report 2008 27 SIGNIFICANT ACCOUNTING POLICIES (continued) for the year ended 31 December 2008
New standards and interpretations not yet adopted (continued)
• IFRS 3: Business combinations supersedes the previous IFRS 3 as issued in 2004. The standard has introduced various terminology and scope changes. IFRS 3, which becomes mandatory for the group’s 2010 financial statements is not expected to have any impact on the financial statements of the group.
• IAS 1: Presentation of financial statements (revised). The main change in the revised IAS 1 is a requirement to present all non-owner changes in equity in a single statement of comprehensive income (which includes income statement line items). Under the revised standard, a statement of financial position (preferred term for “balance sheet”) also has to be presented at the beginning of the comparative period when the entity restates the comparatives as a result of a change in accounting policy, the correction of an error, or the reclassification of items in the financial statements. The revised IAS 1 will become mandatory for the group’s 2010 financial statements
• IAS 23 Borrowing Costs (revised) removes the option to expense borrowing costs and requires that an entity capitalise borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. The revised IAS 23 will become mandatory for the group’s 2010 financial statements and constitute a change in accounting policy for the group. In accordance with transitional provisions the group will apply the revised IAS 23 to qualifying assets from which capitalisation of borrowing costs commences on or after the effective date.
• IAS 32 and IAS 1 amendment: Puttable Financial Instruments and Obligations. Puttable financial instruments and obligations arising on liquidation require certain financial instruments that would ordinarily meet the definition of a financial liability to be classified as equity. These instruments must meet certain criteria as set out in IAS 32. The revision to the standard, which becomes mandatory for the group’s 2010 financial statements, is not expected to have any impact on the financial statements of the group.
• IAS 27: Consolidated and separate financial statements (amendment). Consequential amendments have been made to IAS 27 Consolidated and Separate Financial Statements as a result of the issue of the revised IFRS 3 Business Combinations. The amendments relate mainly to the accounting for changes in the non-controlling (minority) interest in a subsidiary and the loss of control in a subsidiary. The revision becomes mandatory for the company’s 2010 financial statements.
28 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 December 2008 In Pula
Group Company 2008 2007 2008 2007
1. Revenue Sale of goods 15 084 074 13 882 642 - - rendering of services 97 232 506 76 397 122 - -
112 316 580 90 279 764 - -
2. Profit from operations Profit from operations is arrived at after taking into account the following: - -
Income Profit on disposal of property, plant and equipment 966 301 106 306 724 566 - Foreign exchange (loss)/ gain (75 681 ) 242 237 - -
Expenditure Auditors’ remuneration Audit fee – current 374 450 335 898 33 700 27 423 Other services 74 701 72 500 14 774 14 250 Contributions to defined contribution plan 1 469 636 1 253 943 60 634 41 902 Depreciation 4 502 477 4 036 487 426 976 391 732 Operating leases – rental 218 929 90 649 218 929 90 649 Staff costs 53 084 538 40 742 283 3 052 202 1 740 687 Rent - premises 1 251 996 1 019 768 - - royalties 561 593 451 442 - -
3. Directors’ emoluments
Non-executive directors – fees 57 000 48 500 57 000 48 500
Executive directors - remuneration for managerial services 1 120 788 1 167 792 1 120 788 1 167 792 Executive directors – pension contribution 33 915 29 082 33 915 29 082 1 154 703 1 196 874 1 154 703 1 196 874
4. Finance expense
finance lease liabilities 552 045 566 283 - -
G4S Security Services (Botswana) Limited Annual Report 2008 29 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
Group Company 2008 2007 2008 2007
5. Income from investments
Dividends received - subsidiaries - - 8 720 000 8 000 000 Interest received – banks 507 941 489 158 16 757 30 759 Interest received – related companies 1 793 840 1 055 960 1 793 840 1 055 960
2 301 781 1 545 118 10 530 597 9 086 719
6. Income taxation expense
Taxation charge for the year: Basic taxation at 15% 3 170 282 2 648 812 197 325 256 889 Additional company taxation at 10% 2 113 522 1 765 875 131 550 171 259 Prior year (over)/ under provision (121 289 ) 198 829 - 17 424 Deferred tax – current year movement (658 046 ) (253 512 ) (54 876 ) - Deferred tax – prior year under provision - 20 136 - 20 136
4 504 469 4 380 140 273 999 465 708 Withholding tax on dividends received - - 1 308 000 1 200 000
Taxation per income statement 4 504 469 4 380 140 1 581 999 1 665 708
Additional company taxation available for off-set against withholding tax on future dividends 302 809 171 259
Additional company taxation available in subsidiary companies for off-set against withholding tax on future dividends 4 557 385 3 398 067
The group has P434 519 (2007: P440 996) of tax losses available for off-set against future taxable income. Tax losses fall away after five years if not utilised. The aging of the tax losses is as follows:
2007 Tax year 434 519 440 996
Taxation reconciliation: Taxation at the statutory rate on the income for the year 5 502 165 4 370 859 2 679 794 2 438 160 Prior year (over)/under provision (121 289 ) 178 693 - 37 560 Dividends from subsidiaries exempt - - (2 180 000 ) (2 000 000 ) Disallowable items (876 407 ) (169 412 ) (225 795 ) (10 012 ) Withholding tax on dividends received - - 1 308 000 1 200 000
Taxation per income statement 4 504 469 4 380 140 1 581 999 1 665 708
30 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
Group 2008 2007
7. Earnings per share
Profit for the year 17 504 192 13 103 297 Weighted average number of ordinary shares 8 000 000 8 000 000 earnings per share (thebe) 218.80 163.79
8. Dividends Group Company 2008 2007 2008 2007
interim dividend Normal - Paid 38.25 thebe net of tax (2007: 34.00 thebe net of tax) 3 060 000 2 720 000 3 060 000 2 720 000
3 060 000 2 720 000 3 060 000 2 720 000 final dividend proposed 69.70 thebe net of tax (2007: 54.40 thebe net of tax) 5 576 000 4 352 000 5 576 000 4 352 000
8 636 000 7 072 000 8 636 000 7 072 000
Dividend per share (thebe) - net of tax 107.95 88.40 107.95 88.40
The proposed dividend is subject to approval by shareholders at the Annual General Meeting and has been included as equity in the financial statements. The proposed dividend would be payable to all shareholders registered at 20 March 2009.
G4S Security Services (Botswana) Limited Annual Report 2008 31 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
9. Property, plant and equipment Land, Furniture, Motor Radio and buildings and fittings & vehicles & alarm improvements equipment accessories equipment Total Group
Cost At beginning of year 7 858 886 5 955 136 13 773 440 11 535 195 39 122 657 Additions 92 702 838 339 3 153 317 1 757 383 5 841 741 Disposals (547 873 ) (35 741 ) (889 192 ) - (1 472 806 )
At end of year 7 403 715 6 757 734 16 037 565 13 292 578 43 491 592
Accumulated depreciation At beginning of year 1 282 252 4 149 712 8 441 469 8 039 450 21 912 883 Charge for the year 212 028 612 059 2 312 810 1 365 580 4 502 477 Disposals (61 527 ) (7 744 ) (756 855 ) (624 ) (826 750 )
At end of year 1 432 753 4 754 027 9 997 424 9 404 406 25 588 610 Net book value At 31 December 2008 5 970 962 2 003 707 6 040 141 3 888 172 17 902 982
At 31 December 2007 6 576 634 1 805 424 5 331 971 3 495 745 17 209 774
2008 2007 Net book value of motor vehicles and note counters subject to finance lease obligations 4 887 212 4 276 904
Land, Furniture, Motor Radio and buildings and fittings & vehicles & alarm improvements equipment accessories equipment Total Company
cost At beginning of year 7 754 891 1 677 481 - - 9 432 372 Additions 36 112 457 713 - - 493 825 Disposals (547 873 ) - - - (547 873 )
At end of year 7 243 130 2 135 194 - - 9 378 324
Accumulated depreciation At beginning of year 1 214 837 1 106 204 - - 2 321 041 Charge for the year 189 381 237 595 - - 426 976 Disposals (61 527 ) - - - (61 527 )
At end of year 1 342 691 1 343 799 - - 2 686 490 Net book value At 31 December 2008 5 900 439 791 395 - - 6 691 834
At 31 December 2007 6 540 054 571 277 - - 7 111 331
32 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
9. Property, plant and equipment (continued)
Land, buildings and improvements consist of Plot 20584, Gaborone. The property was valued by Knight Frank (Botswana) (Pty) Ltd, registered chartered surveyors on 13 November 2007 at P11 130 000 based on the open market value principle. The open market value principle is defined as the estimated amount for which the property could be exchanged between a willing buyer and a willing seller in an arm’s length transaction after proper marketing, wherein the parties had each acted knowledgeably, prudently and without compulsion. This property is encumbered as per note 24.
Group 10. Goodwill 2008
At cost 9 715 123
The goodwill arises from the acquisition of Filotto Falco Security (Pty) Ltd in 2008. The unit’s impairment test was based on future discounted cash flows and projected earnings. A price to earnings ratio was applied to the projected earnings of the unit to determine the fair value of the goodwill.
The price to earnings ratio was determined based on the industry average price to earnings ratios used in the valuation of acquisitions. Projected earnings for the company are based on historical performance adjusted for expected organic growth and taking into account a projected annual inflation rate of 8% and an interest rate of 16% per annum.
11. Interest in subsidiary companies Principal Company activity 2008 2007 unlisted shares at cost:
Automated Security (Proprietary) Limited Alarm monitoring and guarding (t/a G4S Alarms and G4S Integrated Services) 500 000 ordinary shares of no par value. 557 675 557 675
Fire Protection Services (Proprietary) Limited Dormant company 50 000 ordinary shares of no par value. 50 000 50 000
Security Express (Proprietary) Limited Cash transportation (t/a G4S Cash Services) and cash management 20 000 ordinary shares of no par value. 20 000 20 000
Installec (Proprietary) Limited (t/a G4S Systems) Installation of fire detection and 500 000 ordinary shares of no par value. security equipment 500 000 500 000
Filotto Falco Security (Proprietary) Limited Guarding - 2 ordinary shares of no par value. 10 976 240
12 103 915 1 127 675
G4S Security Services (Botswana) Limited Annual Report 2008 33 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
Group 11. Interest in subsidiary companies (continued) 2008 2007
Amounts due from/(to) subsidiaries Amounts due from subsidiaries 3 401 705 5 603 785 Amounts due to subsidiaries (20 956 176 ) (11 435 867 )
The amounts due by and due to subsidiaries are unsecured, interest free and payable on demand. All subsidiaries are wholly owned and incorporated in Botswana.
12. Inventories
Security alarms, fire alarms and equipment 1 242 537 1 136 767 Consumables 603 411 2 167 002
1 845 948 3 303 769
Amount of inventories recognised as an expense 8 206 133 6 796 053
Group Company 2008 2007 2008 2007 13. Trade and other receivables
Trade receivables 18 357 460 15 216 247 - - Less: Provision for impairment (4 596 220 ) (2 758 434 ) - - other receivables and prepayments 348 589 537 726 122 646 192 419
14 109 829 12 995 539 122 646 192 419
14. Amounts due from related parties
Group 4 Securicor Plc 14 211 252 10 495 849 14 211 252 10 495 849 Securicor Africa (Pty) Limited - 102 365 - 102 365 Fidelity Cash Management Services - 372 630 - 372 630
14 211 252 10 970 844 14 211 252 10 970 844
The pricing policy for trading and other transactions is determined on the basis of normal arm’s length dealings. The amount due from Group 4 Securicor Plc bears interest at 18.0% per annum (2007: 17.5%). The remaining balances are interest free. The amounts due by related parties are unsecured and payable on demand.
15. Cash and cash equivalents
Cash on deposit 3 491 645 3 643 399 46 148 9 635 Other cash and cash equivalent balances 1 527 126 2 798 463 - -
5 018 771 6 441 862 46 148 9 635
Cash and cash equivalents comprise: Botswana Pula 5 018 771 6 441 862 46 148 9 635
34 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
Group Company 2008 2007 2008 2007 16. Stated capital
8 000 000 shares of no par value 1 804 557 1 804 557 1 804 557 1 804 557
With the commencement of the Botswana Companies Act, 2003 on 3 July 2007, the stated capital is now made up of the called up issued share capital and its premium account. All shares in issue (Pula 1 par value) prior to the commencement of the Botswana Companies Act, 2003 (No. 32 of 2004) have been converted into shares of no par value. Such conversion does not affect the rights and liabilities attached to the shares.
Where a company, formed prior to the commencement of the Botswana Companies Act, 2003 (No.32 of 2004), has authorised un-issued shares, the directors may issue these shares up to the authorised share capital limit without a further resolution of the annual general meeting.
The holders of the ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meet- ings of the company. All shares rank equally with regard to the company’s residual assets.
17. Deferred taxation
Deferred tax reconciliation: Balance at beginning of the year 456 727 690 103 91 231 71 095 Deferred taxation per income statement - Current year movement (658 046 ) (253 512 ) (54 876 ) - - Prior year under provision - 20 136 - 20 136
Balance at end of the year (201 319 ) 456 727 36 355 91 231
Analysis of deferred taxation: Accelerated capital allowances (170 388 ) 396 661 36 355 91 231 finance lease obligations 21 237 92 274 - - Available tax losses (111 185 ) (110 528 ) - - Deferred revenue 59 017 78 320 - -
(201 319 ) 456 727 36 355 91 231
G4S Security Services (Botswana) Limited Annual Report 2008 35 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
Group Company 2008 2007 2008 2007 18. Interest bearing borrowings
finance lease liabilities are payable as follows: payable within one year 654 847 730 487 - - Payable within two to five years 3 470 989 3 075 591 - -
4 125 836 3 806 078 - -
These finance lease liabilities are secured over motor vehicles and note counters purchased under finance lease agreements (refer note 9), and bear interest at an average rate of approximately 16 % per annum (2007:16% per annum). These liabilities are repayable in monthly instalments of P229 717 (2007: P242 313) including interest.
19. Trade and other payables Trade payables 3 487 861 3 182 880 155 400 160 957 other payables and accruals 8 191 777 6 545 843 774 844 546 780
11 679 638 9 728 723 930 244 707 737
20. Amounts due to related parties
Group 4 Securicor Plc 49 520 - 49 520 - Securicor Africa (Pty) Limited 138 064 - 138 064 -
187 584 - 187 584 -
These amounts are interest free, unsecured and repayable within 60 days of invoice date.
21. Taxation paid Amounts unpaid/(refundable) at beginning of period 254 748 854 258 345 603 (9 938 ) Taxation per income statement (excluding deferred taxation) 5 162 515 4 613 516 1 636 875 1 645 572 Amounts unpaid at end of period (244 462 ) (254 748 ) (306 713 ) (345 603 )
Cash amounts paid 5 172 801 5 213 026 1 675 765 1 290 031
22. Dividend paid Amounts unpaid at beginning of the year 4 352 000 4 080 000 4 352 000 4 080 000 Dividends declared and paid 8 636 000 7 072 000 8 636 000 7 072 000 Amounts unpaid at end of the year (5 576 000 ) (4 352 000 ) (5 576 000 ) (4 352 000 )
7 412 000 6 800 000 7 412 000 6 800 000
36 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
Company 2008 2007
23. Commitments
operating lease arrangements:
At the balance sheet date, the company had the following outstanding commitments under non-cancellable operating leases:
Due within one year 177 648 53 393 Due in the second to third years inclusive 314 192 214 153
491 840 267 546
24. Financial risk management
Overview The group has exposure to interest rate, liquidity risk, currency and credit risk that arises in the normal course of business. This note presents infor- mation about the group’s exposure to each of the above risks, the group’s objectives, policies and processes for measuring and managing these risks, and the group’s management of capital. Further quantitative disclosures are included.
The Board of Directors has overall responsibility for the establishment and oversight of the group’s risk management framework.
The group’s risk management policies are established to identify and analyse the risks faced by the group, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the group’s activities.
The Board of Directors oversees how management monitors compliance with the group’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the group.
The following table shows the carrying values and the fair values of financial instruments on the balance sheet.
Financial assets Group Company 2008 2007 2008 2007
Trade and other receivables 14 109 829 12 995 539 122 646 192 419 Amounts due from related parties 14 211 252 10 970 844 14 211 252 10 970 844 Amounts due from subsidiaries - - 3 401 705 5 603 785 Cash and cash equivalents 5 018 771 6 441 862 46 148 9 635
Total financial assets 33 339 852 30 408 245 17 781 751 16 776 683
G4S Security Services (Botswana) Limited Annual Report 2008 37 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
24. Financial risk management (continued) Group Company 2008 2007 2008 2007 Financial liabilities Trade and other payables 11 679 638 9 728 723 930 244 707 737 Amounts due to related parties 187 584 - 187 584 - Amounts due to subsidiaries - - 20 956 176 11 435 867 interest bearing borrowings 4 125 836 3 806 078 - -
Total financial liabilities 15 993 058 13 534 801 22 074 004 12 143 604
Net financial assets /(liabilities) 17 346 794 16 873 444 (4 292 253 ) 4 633 079
Currency risk The group is exposed to currency risk (South Africa Rand: Pula) through its purchases from South Africa. At 31 December 2008, the group’s total liabilities to South African creditors amounted to R1 763 582 : P 1 449 956 (2007: R2 063 293 : P 1 842 230).
A 10% strengthening of the Pula against the Rand on the year-end balances would have resulted in increased group profit of P144 996 (2007: P184 223) and a weakening of the Pula by 10 % would have had an equal but opposite effect on group profit.
Interest rate risk Financial instruments that are sensitive to interest rate risk are cash and cash equivalents, amounts due from related parties and interest bearing borrowings. Interest rates applicable to cash and cash equivalents and interest bearing borrowings fluctuate with movements in the prime interest rate and are comparable with rates currently available in the market.
Group Company 2008 2007 2008 2007 Fixed rate instruments Amounts due from related party 14 211 252 10 495 849 14 211 252 10 495 849
refer note 14 for the terms and conditions relating to this balance receivable.
Variable rate instruments
Cash and cash equivalents (note 15) 5 018 771 6 441 862 46 148 9 635 interest bearing borrowings (note 18) (4 125 836 ) (3 806 078 ) - -
892 935 2 635 784 46 148 9 635
The group does not account for any fixed rate instruments at fair value through the income statement and the group does not designate derivatives as hedging instruments under fair value hedge accounting model. Therefore a change in interest rates at the reporting date would not affect profit or loss.
38 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
24. Financial risk management (continued)
With average interest rates for cash and cash equivalents at 7.5% per annum (2007: 7.5% per annum) and interest bearing borrowings at 16% (2007: 16% per annum) a change of 50 basis points in interest rates at the reporting date would have affected group profit as shown below: Group Company 2008 2007 2008 2007 Increase of 50 basis points: Variable rate instruments 4 465 13 179 231 48
Decrease of 50 basis points: Variable rate instruments (4 465 ) (13 179 ) (231 ) (48 )
Credit risk Credit risk is the risk of financial loss to the group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the group’s trade receivables from customers.
The Board of Directors has established a credit policy under which each new customer is analysed individually for creditworthiness before the group’s standard payment and conditions are offered. The group has no significant concentration of credit risk included in trade receivables, with exposure spread over a large number of customers and counterparties. Geographically trade receivables are concentrated in Botswana. No impair- ment accrual has been recognised in respect of group balances as these are payable on demand and covered through the group treasury function.
The group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade receivables. The main compo- nents of this allowance is a specific loss component that relates to receivables outstanding for over 180 days
The credit risk on liquid funds is limited as the counterparties are reputable regulated international banks.
Ageing of trade receivables: Group Company 2008 2007 2008 2007
Not past due 4 562 880 5 075 240 - - Past due 0 - 30 days 6 689 445 3 027 691 - - Past due 30 - 90 days 593 096 1 210 978 - - past due more than 90 days 6 512 039 5 902 338 - -
18 357 460 15 216 247 - - impairment (against balances greater than 180 days) (4 596 220 ) (2 758 434 ) - -
Net trade receivables 13 761 240 12 457 813 - -
No impairment is recognised in terms of balances not exceeding 180 days as these balances are deemed recoverable based on historic loss ratios and analysis.
G4S Security Services (Botswana) Limited Annual Report 2008 39 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
24. Financial risk management (continued)
Movement in impairment of trade receivables: Group 2008 2007
At beginning of the year (2 758 434 ) (5 305 362 ) Additional impairment recognised during the year (2 088 198 ) (1 513 320 ) impairment applied to trade receivables deemed irrecoverable 250 412 4 060 248
At end of the year (4 596 220 ) (2 758 434 )
Liquidity risk Liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due. The group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the group’s reputation.
The group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.
The maturity profile of non derivative financial liabilities based on contractual cash flows is as follows:
Group Contractual Within 1 to 2 years 2 to 5 cash flow 1 year Years 2008 Borrowings (4 125 836 ) (654 847 ) (1 027 637 ) (2 443 352 ) Trade payables (3 487 861 ) (3 487 861 ) - - Other payables (8 191 777 ) (8 191 777 ) - -
(15 805 474 ) (12 334 485 ) (1 027 637 ) (2 443 352 )
Contractual Within 1 to 2 years 2 to 5 cash flow 1 year Years 2007 Borrowings (3 806 078 ) (730 487 ) (917 602 ) (2 157 989 ) Trade payables (3 182 880 ) (3 182 880 ) - - Other payables (6 545 843 ) (6 545 843 ) - -
(13 534 801 ) (10 459 210 ) (917 602 ) (2 157 989 )
Capital management The group secured an overdraft facility for P1.5 million after the balance sheet date in order to facilitate efficient utilisation of excess cash reserves through high interest earning deposits with its head office treasury. The facility is secured over property consisting of land and improvements on Plot 20584, Gaborone (refer note 9).
40 G4S Security Services (Botswana) Limited Annual Report 2008 NOTES TO THE FINANCIAL STATEMENTS (continued) for the year ended 31 December 2008 In Pula
25. Dividends declared by the group
The December 2007 income statements have been restated to reflect a change in the recognition and related tax effect of dividends declared by the holding company. The holding company now declares a net dividend to shareholders without deducting withholding tax. Such withholding tax is already deducted from dividends received from the respective subsidiary companies. The above change had the following impact on the comparative figures: Group Company 2007 2007
Profit for the year as previously stated 14 303 297 9 286 933 Withholding tax on dividends received (1 200 000 ) (1 200 000 )
Profit for the year as restated 13 103 297 8 086 933
Dividends paid as previously stated 8 000 000 8 000 000 Withholding tax on dividends received (1 200 000 ) (1 200 000 )
Dividends paid as restated 6 800 000 6 800 000
26. Segmental reporting
A segment is a distinguishable component of the group that is engaged either in providing related products or services (business segment), or in providing products or services within a particular economic environment (geographic segment), which is subject to risks and rewards that are different from those of other segments. The business activities are concentrated in the segment of security related services and are provided within the geographical region of Botswana, therefore segmental information is not considered necessary.
27. Retirement benefit plans
With effect from 1 October 2003 the group companies contribute to a defined contribution plan set up for employees of the group who are citizens of Botswana.
All employees were given an option to become members of the plan on 1 October 2003 at which date all amounts due to them in terms of the Severance Benefit Scheme were paid into the plan. All new employees are required to become members of the fund in terms of their contracts of employment. Severance benefits are paid to those employees who elected not to become members of the plan.
Expatriate employees are not members of the fund as their terms and conditions of employment provide for gratuity payments at the end of their contracts.
28. Remuneration of key management personnel
The key management personnel compensation consists of short-term employee benefits paid to the executive management of the company consisting of the Executive director, Managing director, Financial director, Human resources manager and General managers for the four subsidiaries.
2008 2007
Short term employee benefits 2 923 903 2 446 558
29. Subsequent events
The directors are considering the amalgamation of the group companies into one holding company in order to realise cost and operating efficiencies. The current group structure consisting of five operating companies has resulted in duplication of some tasks and functions which would fall away on amalgamation bringing in both cost and operating efficiencies. This will not have any effect on the group’s consolidated results but will eliminate the requirement to prepare separate statutory financial statements for each of the subsidiary companies.
G4S Security Services (Botswana) Limited Annual Report 2008 41 NOTICE TO SHAREHOLDERS
Notice is hereby given that the thirtieth Annual General Meeting of the company will be held at Gaborone Sun Hotel on Thursday 23 April 2009 at 4.30pm for the following business:
1. To receive and consider the audited financial statements for the year ended 31 December 2008.
2. To approve the final dividend of 69.70 thebe per share (net of tax) as proposed by the directors on 26 February 2009.
3. To ratify the appointment of Robert Matthews who was appointed a director by the Board on 14 August 2008. . 4. To ratify the appointment of Karel Meyer who was appointed a director by the Board on 6 November 2008.
5. To elect a director in place of Mr. Lebang Mpotokwane, who retires by rotation in terms of the Articles of Association and, being eligible, offers himself for re-election
6. To determine the remuneration of the directors as required by the Articles of Association, and as detailed on page 29 of the Annual Report.
7. To fix the remuneration of the auditors for the past audit as required by the Articles of Association, and as detailed on page 29 of the Annual Report
8. To transact such other business as may be transacted at an Annual General Meeting.
A member entitled to attend and vote may appoint a proxy to attend and vote on their behalf, and such proxy need not also be a member of the company. The instrument appointing such a proxy must be deposited at the registered office of the company not less than 48 hours before the meeting.
By Order of the Board
PricewaterhouseCoopers (Pty) Ltd Secretaries
REGISTERED OFFICE
Plot 50371, Fairground Office Park, Gaborone P O Box 294, Gaborone
26 February 2009
42 G4S Security Services (Botswana) Limited Annual Report 2008 FORM OF PROXY
Thirtieth Annual General Meeting of shareholders of G4S Security Services (Botswana) Lim- ited to be held at the Gaborone Sun Hotel on 23 April 2009 at 4.30pm.
I/We, the undersigned, being a member of G4S Security Services (Botswana) Limited, do hereby appoint
or failing him/her
or failing him/her
or failing him/her the Chairman of the Meeting as my/our Proxy and Agent to attend and vote for me/us on my/our behalf at the above mentioned Annual General Meeting of the Company.
Unless otherwise stated, the Proxy will vote for me/us as he thinks fit.
DATED AT THIS DAY OF 20
Signature of Member:
Name of Member:
No. of shares registered in Member’s name:
G4S Security Services (Botswana) Limited Annual Report 2008 43 44 G4S Security Services (Botswana) Limited Annual Report 2008 G4S Security Services (Botswana) Limited Annual Report 2008 45 Securing Your World
Head Office, Gaborone P O Box 1488 Gaborone Plot 20584 Western Bypass
Tel: 391 2211,393 9999 , Fax: 391 2779 E-mail: [email protected]