Financial Information Financial Statements Developing sustainable fnancial strength 189 INDEX TO THE FINANCIAL INFORMATION Annual Report of the Board of Directors 191-195 The Statement of Directors’ Responsibility 196 Independent Auditors’ Report 197-199 Income Statement 200 Statement of Comprehensive Income 201 Statement of Financial Position 202 Statement of Cash Flows 203-204 Statement of Changes in Equity 204-205 Group Performance Summary 206-207 Notes to the Financial Statements 208-286 Corporate and Group information 1 Corporate information 208 20 Taxes 241-248 2 Group information 208 21 Property , plant and equipment 248-253 22 Leases 253-254 Basis of Preparation and Other Signifcant Accounting 23 Investment property 254-255 Policies 24 Intangible assets 256-258 3 Basis of preparation 208 25 Investment in subsidiaries 259-261 4 Summary of signifcant accounting policies 209 26 Investment in equity accounted investees 261-264 5 Signifcant accounting judgements, estimates and 27 Non current fnancial assets 264-265 assumptions 209-210 28 Other non current assets 265-266 6 Changes in accounting standards and standards 29 Inventories 266 issued but not yet efective 210-212 30 Trade and other receivables 266-267 31 Other current assets 267 Group Business, Operations and Management 32 Short term investments 267-268 7 Operating segment information 212-216 33 Stated capital and other components of equity 269 8 Basis of consolidation and material partly owned 34 Share-based payment plans 270-271 subsidiaries 217-219 35 Insurance contract liabilities 271-274 9 Business combinations and acquisitions of non-controlling interests 219-221 36 Interest-bearing loans and borrowings 274-277 10 Financial risk management objectives and policies 222-229 37 Employee beneft liabilities 277-278 11 Fair value measurement and related fair 38 Other deferred liabilities 278-279 value disclosures 229-231 39 Other non current liabilities 279 12 Financial instruments and related policies 231-237 40 Trade and other payables 279 41 Short term borrowings 279 Notes to the Income Statement, Statement of 42 Other current liabilities 280 Comprehensive Income and Statement of Financial Position 43 Related party transactions 280-283 13 Revenue 237 14 Dividend income 237 Other Disclosures 15 Other operating income and other operating expenses 238 44 Contingent liabilities 284-285 16 Net fnance income 239 45 Capital and other commitments 286 17 Proft before tax 240 46 Lease commitments 286 18 Earnings per share 240-241 47 Assets pledged 286 19 Dividend per share 241 48 Events after the reporting period 286 190 John Keells Holdings PLC . Annual Report 2017/18 Financial Information ANNUAL REPORT OF THE BOARD OF DIRECTORS The Directors have pleasure in presenting the 39th Review of Business Segments Financial Results and Appropriations Annual Report of your Company which covers A review of the financial and operational Revenue the Audited Financial Statements, Chairman’s performance and future business Revenue generated by the Company Message, Corporate Governance Commentary, developments of the Group, sectors, and amounted to LKR. 1,348 Mn (2017 – LKR. Capital Management Review, Industry Group its business units are described in the 1,126 Mn), whilst Group revenue amounted Review and all the other relevant information Management Discussion and Analysis to LKR. 121,215 Mn (2017 – LKR. 106,273 Mn). for the year ended 31st March 2018. Disclosures section of the Annual Report. Significant Contribution to Group revenue, from the which appear in the Share Information section changes to business combinations and diferent business segments is provided in form a part of the Annual Report of the Board of acquisition of non-controlling interests Note 7 to the Financial Statements. Directors as it is a requirement of the Companies are provided in Note 9 to the Financial Act No. 07 of 2007. Statements. These reports, together with Proft and Appropriations the audited financial statements, reflect The proft after tax of the Company was Principal Activities the state of affairs of the Company and LKR. 21,222 Mn (2017 – LKR. 16,152 Mn) whilst John Keells Holdings PLC (the Company), the Group. Segment wise contribution to the Group proft attributable to equity holders the Group’s holding Company, manages a Group revenue, results, assets and liabilities of the parent for the year was LKR. 21,021 Mn portfolio of holdings consisting of a range of are provided in Note 7 to the Financial (2017 - LKR. 16,275 Mn). diverse business operations, which together Statements. constitute the John Keells Group (the Group), The Company’s total comprehensive and provides function based services to its Future Developments income net of tax was LKR. 21,152 Mn subsidiaries, joint ventures and associates. Information on future developments are (2017 - LKR. 16,123 Mn), and the Group total contained in the Chairman’s Message and comprehensive income attributable to parent The companies within the Group and its Management Discussion and Analysis sections was LKR. 28,619 Mn (2017 - LKR. 25,694 Mn). business activities are described in the of this Annual Report. Group Directory under the Supplementary Dividend and Reserves Information section of the Annual Report. Financial Statements As required by Section 56(2) of the Companies There were no signifcant changes to the Financial Statements of the Company and Act No 7 of 2007, the Board of Directors have principal activities of the Company or its Group for the year ended 31 March 2018, confrmed that the Company satisfes the subsidiaries during the year. which have been prepared in accordance with solvency test in accordance with Section 57 Sri Lanka Accounting Standards (SLFRS/LKAS) of the Companies Act No 7 of 2007, and has Corporate Vision and Values with the inclusion of the signatures of the obtained certifcates from the auditors, prior to A culture of innovation, integrity, excellence, Chairman, Group Finance Director and Group declaring all dividends. A fnal dividend will be caring and trust has been developed among Financial Controller, are given from page paid on 18 June 2018 to those shareholders on the Group and by being aligned with them, 200 to 286 and form a part of the Integrated the register as of 5 June 2018. the Directors and employees conduct their Annual Report. activities to achieve the vision, “Building Accounting Policies businesses that are leaders in the region”. All the signifcant accounting policies adopted by the Company and Group are mentioned in John Keells Holdings PLC the Notes to the Financial Statements. There have been no changes in the accounting For the year ended 31 March policies adopted by the Group during the In LKR ‘000s 2018 2017 year under review. For all periods up to and including the year ended 31 March 2018, Proft after tax 21,222,229 16,152,442 the Group prepared its fnancial statements Other adjustments (4,083) (5,310) in accordance with Sri Lanka Accounting Balance brought forward from the previous year 47,213,561 39,337,754 Standards (SLFRS/LKAS) which have materially Amount available for appropriation 68,431,707 55,484,886 converged with the International Financial Reporting Standards (IFRS) as issued by the 1st interim dividend of LKR. 2.00 per share (2017-LKR. 2.00) International Accounting Standards Board paid out of dividend received. (2,775,002) (2,721,458) (IASB). 2nd interim dividend of LKR. 2.00 per share (2017-LKR. 2.00) paid out of dividend received. (2,775,047) (2,774,933) Capital Expenditure Final dividend declared of LKR. 2.00 per share (2017-LKR. 2.00) The Company’s and Group’s capital to be paid out of dividend received.* (2,775,057) (2,774,934) expenditure on property, plant and equipment Balance to be carried forward to the next year 60,106,601 47,213,561 amounted to LKR. 86 Mn (2017 - LKR. 11 Mn) and LKR. 18,922 Mn (2017 -LKR. 4,332 Mn) respectively and all other related information *In accordance with LKAS 10, Events after the reporting period, the fnal dividend has not been and movements have been disclosed in recognised as a liability in the fnancial statements. Note 21 to the Financial Statements. 191 ANNUAL REPORT OF THE BOARD OF DIRECTORS Additions of intangible assets of the Company Share Information Interests Register and Interests in and Group during the year amounted to LKR. The distribution and composition of Contracts 33 Mn (2017 - LKR. 7 Mn) and LKR. 218 Mn shareholders and the information relating The Company has maintained an Interests (2017 - LKR. 114 Mn) respectively and all other to earnings, dividends, net assets, market Register as contemplated by the Companies related movements are disclosed in Note 24 to value per share and share trading is given Act No 7 of 2007. the Financial Statements. in the Share Information section of the Annual Report. As additional disclosures, the This Annual Report also contains particulars Valuation of Land, Buildings and Company’s Board of Directors’ (including their of entries made in the Interests Registers of Investment Properties close family members) shareholdings, options subsidiaries which are public companies or All land and buildings owned by Group available under the employee share option private companies which have not dispensed companies were revalued during the fnancial (ESOP) plans as at 31 March 2018, market with the requirement to maintain an Interests year ended 31 March 2018 and the carrying capitalisation, public holding percentage and Register as permitted by Section 30 of the value amounted to LKR. 70,741 Mn (2017 number of public shareholders are given in Companies Act No 7 of 2007. - LKR. 52,615 Mn). All information related the Share Information section of the Annual to revaluation is given in Note 21.3 to the Report. The Directors have all made a general Financial Statements.