Total Petroleum Ghana Limited ANNUAL REPORT 2014
Contents
Chapters P a g e
1 Corporate Information 02
2 Board Of Directors 03
3 Management Team 04
4 Financial Highlights 05
5 Chairman’s Statement 06
6 Notice Of Meeting 08
7 Report Of The Directors 09
8 Independent Auditor’s Report 11
9 Financial Statements 13
Statements Of Financial Position 13
Statements Of Profit And Loss And Other Comprehensive Income 14
Statements Of Changes In Equity 15
Statements Of Cash Flows 17
10 Notes To The Financial Statements 19
11 Resolutions 54
12 Extract Of Code Of Conduct 55
13 Business Development 58
Network and Commercial Development 58
14 Corporate Programmes 60
15 Recognition 63
16 Proxy Form 66 Annual Report & Financial Statement 1 for the year ended 31st December, 2014 Corporate Information
BOARD OF DIRECTORS
• Thibault de Langlais - Chairman • Olivier Van-Parys - Managing Director (Appointed: 1st September, 2014) • Rexford Adomako-Bonsu • Edward Patrick Larbi Gyampoh • Kofi Ampim • Momar Nguer • Gerard Pruneau • Emmanuel de Fournas • Martin Amenyedzi - (Appointed: 16th July, 2014) • Guillaume Larroque - (Resigned: 1st September, 2014) • Samuel Manu Asiama - (Resigned: 16th July, 2014)
SECRETARY REGISTERED OFFICE Mrs. Mercy Samson ‘Total House’ ‘Total House’ 25 Liberia Road 25 Liberia Road P. O. Box 553 P. O. Box 553 Accra Accra
SOLICITORS REGISTRARS Peasah Boadu & Co. Universal Merchant Bank 3rd Floor, Gulf House 123 Kwame Nkrumah Avenue, P. O. Box CT3523 Sethi Plaza, Cantonments - Accra Adabraka - Accra
AUDITORS BANKERS KPMG Agricultural Development Bank Chartered Accountants Barclays Bank of Ghana Limited 13 Yiyiwa Drive, Abelenkpe Ecobank Ghana Limited P. O. Box GP 242 Ghana Commercial Bank Limited Accra National Investment Bank Limited Societe Generale Ghana Stanbic Bank Ghana Limited Standard Chartered Bank Limited Universal Merchant Bank
02 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 2 Board Of Directors
Thibault de Langlais Olivier Van-Parys Chairman Managing Director (Appointed: 1st September, 2014)
Gerard Pruneau Emmanuel de Fournas Momar Nguer Member Member Member
Rexford Adomako-Bonsu Edward Patrick Kofi Ampim Martin Amenyedzi Member Larbi Gyampoh Member Member Member (Appointed: 16th July, 2014)
Total Petroleum Ghana Limited • 03 Annual Report & Financial Statement 3 for the year ended 31st December, 2014 Management Team
6 8 5 7 4
1 2 3
1. MERCY SAMSON 5. SUNIL GANDHI Corporate Services Manager Operations Manager
2. ROSE NKADA 6. EMMANUEL MENYAH HUGHES Accounting & Finance Manager External Affairs Manager
3. ADESUA ADEWOLE 4. OLIVIER VAN-PARYS Sales & Marketing Manager Managing Director
4. BRIGHT DOKOSI 8. BIJOU DOE Health, Safety, Environment & Quality Manager Human Resource Manager
04 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 4 Financial Highlights
Five year Financial Highlights
2014 2014 2013 2013 2012 2011 2010
Group Company Group Company Company Company Company
Turnover(GH¢’000) 1,657,841 1,657,841 1,338,155 1,338,155 1,329,363 971,683 738,910
Profit before interest and 47,343 48,755 52,878 53,001 36,983 29,763 27,783 exchange Difference (GH¢’000)
Net Finance cost (GH¢’000) 5,849 5,849 1,557 1,557 1,514 564 607
(Gain)/loss on Exchange (1,837) 1,105 6,859 7,821 2,356 601 - (GH¢’000) Profit before Taxation and NRL 44,436 41,801 47,576 46,737 40,853 30,928 28,390 (GH¢’000)
Taxation and NRL (GH¢’000) (11,577) (10,841) (11,031) (11,031) (10,327) (8,364) (7,344)
Profit After Taxation and NRL 32,859 30,960 36,545 35,706 30,526 22,564 21,046 (GH¢’000)
Earning per share (GH¢) 0.2861 0.2767 0.3233 0.3192 2.1829 1.6135 1.5050
Dividend per share (GH¢) 0.1755 0.1755 0.1755 0.1755 1.25 1.14 1.0535
Shareholders Equity (GH¢,000) 122,689 114,817 109,475 103,502 86,071 72,606 66,206
Number of issued shares 111,874,072 111,874,072 111,874,072 111,874,072 13,984,259 13,984,259 13,984,259
Fixed assets net book value 136,778 110,418 91,742 91,260 73,718 64,455 57,287 (GH¢’000)
Net assets per share (GH¢) 1.0967 1.0263 0.9786 0.9252 6.1548 5.1919 4.7343
Total Petroleum Ghana Limited • 05 Annual Report & Financial Statement 5 for the year ended 31st December, 2014 Chairman’s Statement
Introduction Ladies and Gentlemen, I am very pleased to welcome all our shareholders to the thirty-eighth Annual General Meeting of Total Petroleum Ghana Limited. We hereby present to you the Annual Report and the Financial Statements of your Company for the financial year ended 31st December 2013.
Economic Environment Macro-economic indicators slowed down in 2013 compared to 2012. In 2013, the average inflation rate for the year amounted to 11.5% the Ghanaian Cedi closed on 31st December 2013 lower against the US dollar than a year before. The Company remains however confident in the overall prospects of the Ghanaian economy and sees a strong prospect in the mid-term.
Financial and Operational Performance The Gross Profit for 2013 reached GHS 101.153 million, increasing by +27.5% compared to 2012, underpinned by higher margins and a higher proportion of lubricants in the sales of the Company.
The consolidated profit after tax for 2013 increased by +20%, reaching GHS 36.545 million as against GHS 30.526 million in 2012. This increase originated in particular from the sale of a higher proportion of higher valued specialities products, in particular, lubricants and new products and services offered to our customers. In 2013, the Company also opened 7 new Service stations further widening the spread of its offer of products and services all over the country.
The Company further improved its Health, Safety, Environment and Quality standards in 2013 with tight quality controls performed at its outlets and the renewal of its ISO 9001 certification. Two of the Company’s main depots, one in Tarkwa and the other in Takoradi, were certified within the IsssRs system which is an international safety management system for sites.
The level of investments in 2013 reached GHS 32.5 million, an increase from GHS 28.4 million in 2012. The focus of the investment was on improving the quality of the network of service stations and the creation of new outlets. The Company introduced its new service station design in 2013 and has since gradually upgraded its network.
The earnings per share progressed from GHS 0.2729 per share in 2012 to GHS 0.3267 per share in 2013.
Dividend In November 2013, the Board approved the payment of an interim dividend of GHS 0.07710 per share.
The Board is recommending a final dividend of GHS 0.09844 per share before tax in respect of the year ended 31st December 2013, culminating in a total dividend of GHS 0.17554 per share to be paid to shareholders in respect of the same year.
06 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 5 Chairman’s Statement (Continued)
Board Matters During the year under review, one of the Directors Mr. J.S. Addo resigned from the board having served as a Director since 1992. On behalf of the Board and the shareholders, we express our profound gratitude to Mr. J.S. Addo for his dedication and contributions to the growth of the Company’s business over the years.
The Board also recommends to you for re-election the following Directors:
• Mr. Gerard Pruneau
• Mr. Emmanuel de Fournas
• Mr. Kofi Ampim
• Mr. Samuel Manu Asiama
Outlook The Company has now embarked on a significant investment program aimed at upgrading existing service stations and opening numerous new sites.
New concepts for shops and restaurants have also been introduced in Ghana and the Company is working at widening its offer for products and services geographically.
Your Company will maintain its focus on the development of its lubricants sales and investment in maintaining its technological edge in that segment of activity.
Appreciation Your Company’s strategy aims at providing the highest level of customer satisfaction and operating according to the high standards of ethics and business conduct. As a responsible leader of the downstream oil industry, your Company is aiming at operational excellence in order to play a positive role in this important sector of the Ghanaian economy.
Your Company has been engaged for many years in the promotion and development of local talents through some key programs:
• The young dealer program offering the possibility to staff employed at service stations to become as dealers fully- fledged entrepreneurs.
• Our “made in Ghana” strategies: most of the lubricants sold by the Company are manufactured in Tema.
• Our suppliers’ capacity building programs: the Company’s transport partners benefited from financing schemes facilitated by your Company to renew their fleet.
On behalf of the Board of Directors, we thank our Management and Staff of Total Petroleum Ghana Limited for their contribution towards the results of 2013 and for their dedicated service. We also thank you our shareholders and loyal customers for your strong support to the Company.
Finally, I thank you all for you presence here today.
Thibault De Langlais Chairman
Total Petroleum Ghana Limited • 07 Annual Report & Financial Statement 6 for the year ended 31st December, 2014 Notice Of Meeting
NOTICE is hereby given that the 39th Annual General Meeting of the Shareholders of Total Petroleum Ghana Limited will be held at the National Theatre, Liberia Road, Accra on Wednesday 3rd June, 2015 at 11 O’clock in the forenoon. AGENDA
ORDINARY BUSINESS
Ordinary Resolution 1. To receive and consider the Reports of the Directors, Auditors and the Financial Statements of the Company for the year ended 31st December, 2014.
2. To declare a Final Dividend in respect of the year ended 31st December, 2014.
3. To ratify the appointment of Directors.
4. To re-elect Directors retiring by rotation.
5. To approve the remuneration of the Directors.
6. To authorise the Directors to fix the remuneration of the Auditors.
SPECIAL BUSINESS
Special Resolution 7. To amend the Regulations of the Company by the addition of a new business objective as follows:
• g) To engage in the production and distribution of Solar Energy and other forms of renewable energy.
Dated this ...... day of ...... 2015
By Order of the Board
MERCY SAMSON (MRS.)
SECRETARY
Note:
A member of the company entitled to attend and vote may appoint a proxy to attend and vote in his/her stead. A proxy need not be a member of the company. Completed proxy forms should be deposited at the Registered Office, P. O. Box 553, Accra not less than 48 hours before the appointed time of the meeting. Failure to submit the forms before 48 hour deadline will result in the Proxy not being admitted to, or participating in, the meeting. A Form of Proxy is provided in the Annual Report.
08 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 7 Report Of The Directors
The directors present their report and financial statements of the Company and its subsidiary (together referred to as the Group) for the year ended 31 December 2014.
DIRECTORS RESPONSIBILITY STATEMENT 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, 1963 (Act 179), and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
The directors have made an assessment of the ability of the company and its subsidiary to continue as going concerns and have no reason to believe that the businesses will not be going concerns in the year ahead.
FINANCIAL STATEMENTS AND DIVIDEND The results for the year are as set out in the attached financial statements, highlights of which are as follows:
GH¢’000 Profit for the year attributable to equity holders was 32,004 which when added to the balance brought forward on the retained earnings (income surplus) account of 52,742
gives a total of 84,746
out of which is deducted the following dividends declared and paid: final dividend for 2013 at GH¢0.0985 per share (11,020) interim dividend for 2014 at GH¢0.0771 per share (8,625) (19,645) leaving a balance to be carried forward on the retained earnings account of 65,101
The directors recommend the payment of a final dividend of GH¢0.0984 per share amounting to GH¢11,008,409 for 2014 financial year (2013: GH¢11,019,596). This brings the total dividend for 2014 financial year to GH¢0.1755 per share amounting to GH¢19,633,900 (2013: GH¢ 0.17554 per share amounting to GH¢ 19,645,088).
The directors consider the state of the Group’s affairs to be satisfactory.
NATURE OF BUSINESS The company is registered to carry on the business of marketing petroleum and allied products. There was no change in the nature of business of the company during the year.
Total Petroleum Ghana Limited • 09 Annual Report & Financial Statement 7 for the year ended 31st December, 2014 Report Of The Directors, continued
HOLDING COMPANY The company is a subsidiary of Total Outre Mer S.A., a company incorporated in France. The ultimate parent company is Total S.A., a company incorporated in France.
SUBSIDIARY COMPANY The company has a 55% interest in Ghanstock Limited, a company incorporated in Ghana. Ghanstock Limited is authorised to build, own, operate, and maintain petroleum storage facilities.
ASSOCIATE COMPANIES
Ghana Bunkering Services Limited The company has a 48.5% interest in Ghana Bunkering Services Limited, a company incorporated in Ghana to provide bunkering services to petroleum marketers in the country.
Road Safety Limited (RSL) The company has a 50% interest in RSL (formerly, Petroleum Road Transport Safety Limited), a company incorporated in Ghana, whose principal business is to provide driver education and maintenance services for the haulage of petroleum products.
APPROVAL OF FINANCIAL STATEMENTS These financial statements were approved by the Board of Directors on 25th March, 2015 and signed on their behalf by:
DIRECTOR DIRECTOR
10 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 8 Independent Auditor’s Report To The Members Of Total Petroleum Ghana Limited
Report on the financial statements
We have audited the consolidated and separate financial statements of Total Petroleum Ghana Limited (the Company), which comprise the statements of financial position at 31 December 2014, and the statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and the notes to the financial statements which include a summary of significant accounting policies and other explanatory notes, as set out on pages 19 to 56.
Directors’ Responsibility for the financial statements The Company’s 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, 1963 (Act 179), and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
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 about 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 judgement, 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 entity’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 entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion, these financial statements give a true and fair view of the consolidated and separate financial position of Total Petroleum Ghana Limited at 31 December 2014, and its consolidated and separate 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, 1963 (Act 179).
Total Petroleum Ghana Limited • 11 Annual Report & Financial Statement 8 for the year ended 31st December, 2014 Independent Auditor’s Report To The Members Of Total Petroleum Ghana Limited (continued)
Report on Other Legal and Regulatory Requirements Compliance with the requirements of Section 133 of the Companies Act, 1963 (Act 179).
We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purpose of our audit.
In our opinion, proper books of account have been kept, and the consolidated and separate statements of financial position and profit or loss and other comprehensive income are in agreement with the books of account.
SIGNED BY: ANTHONY K. SARPONG (ICAG/P/1369)
FOR AND ON BEHALF OF:
KPMG: (ICAG/F/2014/038)
CHARTERED ACCOUNTANTS
13 YIYIWA DRIVE, ABELENKPE
P. O. BOX GP 242
ACCRA
...... , 2015
12 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 9 Statements Of Financial Position As At 31 December 2014
Group Group Company Company 2014 2013 2014 2013 Note GH¢’000 GH¢’000 GH¢’000 GH¢’000 Assets Property, plant and equipment 12 136,778 91,742 110,418 91,260 Intangible assets 13 13,514 12,999 13,514 12,999 Investment in associates 14 (a) 12 12 12 12 Long term leases 25 10,764 8,361 10,764 8,361 Investment in subsidiary 14 (b) - - 6,274 6,274 Total non-current assets 161,068 113,114 140,982 118,906 Inventories 15 68,923 83,712 68,923 83,712 Income tax asset 10 (ii) 5,055 635 5,055 635 Trade and other receivables 16 156,384 125,995 156,310 126,482 Amounts due from related companies 24 2,029 1,313 3,008 1,313 Cash and cash equivalents 17 12,197 20,621 8,873 8,349 Total current assets 244,588 232,276 242,169 220,491 Total assets 405,656 345,390 383,151 339,397 Equity Stated capital 18 51,222 51,222 51,222 51,222 Retained earnings (Income surplus) 65,101 52,742 63,595 52,280 Non-controlling interest 6,366 5,511 - - Total equity 122,689 109,475 114,817 103,502 Liabilities Bank overdraft 17 45,307 8,693 45,307 8,693 Loans and borrowings 21 604 - - - Trade and other payables 20 196,536 201,540 195,437 201,520 Amount due to related companies 24 20,320 24,788 21,299 24,788 Total current liabilities 262,767 235,021 262,043 235,001
Loans and borrowings 21 1 3 , 1 7 3 - - - Provisions 22 6 , 0 2 0 - 6 , 0 2 0 - Deferred tax liabilities 11 1,007 894 271 894 Total non-current liabilities 2 0 , 2 0 0 894 6,291 894 Total liabilities 282,967 235,915 268,334 235,895 Total liabilities and equity 405,656 345,390 383,151 339,397
DIRECTOR DIRECTOR
The notes on page 19 to 56 form an integral part of these financial statements.
Total Petroleum Ghana Limited • 13 Annual Report & Financial Statement 9 for the year ended 31st December, 2014 Statements Of Profit And Loss And Other Comprehensive Income For The Year Ended 31 December 2014
Group Group Company Company 2014 2013 2014 2013 Note GH¢’000 GH¢’000 GH¢’000 GH¢’000 Revenue 6 1,657,841 1,338,155 1,657,841 1,338,155
Cost of sales 8 (1,540,707) (1,237,002) (1,540,707) (1,237,002) Gross profit 117,134 101,153 117,134 101,153
Other income 7 15,344 14,621 12,402 13,659
General, administrative and selling expense 8 ( 8 2 , 1 9 3 ) (69,755) (81,886) (69,632) Operating profit before financing costs/ income 50,285 46,019 47,650 45,180
Finance income 274 1,954 274 1,954
Finance costs (6,123) (397) (6,123) (397) Profit before taxation 8 44,436 47,576 41,801 46,737
Income tax expense 10 (i) (11,577) (11,031) (10,841) (11,031) 32,859 36,545 30,960 35,706 Other comprehensive income - - - - Profit for the year 32,859 36,545 30,960 35,706
Profit attributed to: Owners of the company 32,004 36,168 - - Non-controlling interest 855 377 - -
Basic earnings per share 19 0.2861 0.3233 0.2767 0.3192 (Ghana cedi per share)
Diluted earnings per share 19 0.2861 0.3233 0.2767 0.3192 (Ghana cedi per share)
The notes on page 19 to 56 form an integral part of these financial statements.
14 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 9 Statements Of Changes In Equity For The Year Ended 31 December 2014
Share Retained Non-Control- Total Capital Earnings ling Interest Equity Group GH¢’ 000 GH¢’ 000 GH¢’ 000 GH¢’ 000
Balance at 1 January 2014 51,222 52,742 5,511 109,475
Total comprehensive income for the year Profit for the year - 32,004 855 32,859
Total comprehensive income for the year - 32,004 855 32,859
Transaction with equity holders Dividend paid - (19,645) - (19,645) Total transactions with equity holders - (19,645) - (19,645)
Balance at 31 December 2014 51,222 65,101 6,366 122,689
Balance at 1 January 2013 49,722 36,349 - 86,071
Total comprehensive income for the year Profit for the year - 36,168 377 36,545 Other comprehensive income - - - -
Total comprehensive income for the year - 36,168 377 36,545
Transaction with equity holders Dividend paid - (18,275) - (18,275) Bonus issue 1,500 (1,500) - -
Total transactions with equity holders 1,500 (19,775) - (18,275)
Changes in ownership interests: Acquisition of subsidiary with non-controlling interest - - 5,134 5,134
Total transactions with equity holders - - 5,134 5,134
Balance at 31 December 2013 51,222 52,742 5,511 109,475
Total Petroleum Ghana Limited • 15 Annual Report & Financial Statement 9 for the year ended 31st December, 2014
Statements Of Changes In Equity For The Year Ended 31 December 2014 (cont’d)
Share Retained Total Capital Earnings Equity Company GH¢’000 GH¢’000 GH¢’000
Balance at 1 January 2014 51,222 52,280 103,502
Total comprehensive income for the year Profit for the year - 30,960 30,960 Other comprehensive income - - -
Total comprehensive income for the year - 30,960 30,960
Transaction with equity holders Dividend paid - (19,645) (19,645)
Total transactions with equity holders - (19,645) (19,645)
Balance at 31 December 2014 51,222 63,595 114,817
Balance at 1 January 2013 49,722 36,349 86,071
Total comprehensive income for the year Profit for the year - 35,706 35,706 Other comprehensive income - - -
Total comprehensive income for the year - 35,706 35,706 Transaction with equity holders
Dividend paid - (18,275) (18,275) Bonus issue 1,500 (1,500) -
Total transactions with equity holders 1,500 (19,775) (18,275)
Balance at 31 December 2013 51,222 52,280 103,502
The notes on page 19 to 56 form an integral part of these financial statements.
16 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 9
Statements Of Cash Flows For The Year Ended 31 December 2014
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Cash flows from operating activities Profit before taxation 44,436 47,576 41,801 46,737 Adjustments for: Foreign exchange gains (6,660) - (6,660) - Depreciation charges 10,780 8,901 10,780 8,901 Amortisation of intangible assets 108 116 108 116 Amortisation of long term lease 989 1,178 989 1,178 Interest received (274) ( 1 , 9 5 4 ) (274) (1,954) Provision 6,020 - 6,020 - Interest expense 6,123 397 6,123 397 Profit on disposal of plant and equipment (188) ( 4 8 6 ) (188) (486) 61,334 55,728 58,699 54,889
Change in inventories 14,789 (33,684) 14,789 (33,684) Change in trade and other receivables (24,989) (5,455) (24,428) (5,943) Change in trade and other payables (3,956) 20,978 (5,035) 20,958 Change in related party balances (5,184) 9,058 (5,184) 9,058 Cash generated from operations 41,994 46,625 38,841 45,278 Interest received 274 1,954 274 1,954 Interest paid (6,123) (397) (6,123) (397) Income taxes paid (15,884) (15,034) (15,884) (15,034)
Net cash flow from operating activities 20,261 33,148 17,108 31,801
Cash flows from investing activities Purchase of property, plant and equipment (55,882) (28,703) (30,004) (28,220) Purchase of software (623) - (623) - Proceeds from sale of plant and equipment 254 1,232 254 1,232 Principal payment for leases contracted (3,936) (3,887) (3,936) (3,887)
Net cash flow used in investing activities (60,187) (31,358) (34,309) (30,875)
Cash flows used in financing activities Dividend paid (19,645) (18,275) (19,645) (18,275) Proceeds from share issue by subsidiary - 5,134 - - Proceeds from new loans 13,777 - - -
Net cash flow used in financing activities (5,868) (13,141) (19,645) (18,275)
Total Petroleum Ghana Limited • 17 Annual Report & Financial Statement 9 for the year ended 31st December, 2014 Statements Of Cash Flows For The Year Ended 31 December 2014 (Cont’d)
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000
Net decrease in cash and cash equivalents (45,794) (11,351) (36,846) (17,349)
Analysis of changes in cash and cash equivalents during the year Balance at 1 January (Note 17) 11,928 23,279 (344) 17,005 Net decrease in cash and cash equivalents (45,794) (11,351) (36,846) (17,349) Effect of foreign exchange fluctuation on cash held 756 - 756 - Balance at 31 December (33,110) 11,928 (36,434) (344)
Analysis of balances of cash and cash equivalents as shown in the balance sheet Cash and bank balances (Note 17) (33,110) 11,928 (36,434) (344)
The notes on page 19 to 56 form an integral part of these financial statements.
18 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014
1. REPORTING ENTITY
Total Petroleum Ghana Limited is a company registered and domiciled in Ghana. The address of the company’s registered office is Total House, 25 Liberia Road, Accra. The company is authorised to carry on the business of marketing petroleum and allied products. 2. BASIS OF ACCOUNTING a. Statement of compliance These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs). Additional information required under the Companies Act, 1963 (Act 179) have been included where appropriate. b. Basis of measurement These financial statements have been prepared under the historical cost convention except for financial instruments that are measured at fair value. c. Functional and presentational currency These financial statements are presented in Ghana Cedi (GH¢) which is the Group’s functional currency. All financial information presented in Ghana Cedi has been rounded to the nearest thousand, unless otherwise indicated. d. Use of estimates and judgement In preparing these financial statements, management has made judgments, estimates and assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized prospectively.
Judgements Information about judgements made in applying the accounting policies that have the most significant effects on the amounts recognised in these financial statements is included in the following notes:
• Notes 14a and 3(a)(iii) – consolidation: whether the Group has de facto control over an investee
• Notes 25 and 26(a) – lease classification.
Assumptions and estimation uncertainties Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in subsequent periods is included in the following notes:
• Note 4 – measurement of fair values
• Note 11 – recognition of deferred tax liabilities
• Note 22 – recognition and measurement of provisions and contingencies: key assumptions about the likelihood and magnitude of an outflow of resources.
Total Petroleum Ghana Limited • 19 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these financial statements.
(a) Basis of consolidation
(i) Business combinations The Group accounts for business combinations using the acquisition method when control is transferred to the Group (see (a) (iii.) The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment (see (c) (ii)). Any gain on a bargain purchase is recognised in profit or loss immediately. Transaction costs are expensed as incurred, except for if related to the issue of debt or equity securities (see (q)).
The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognised in profit or loss.
Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is classified as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes in the fair value of the contingent consideration are recognised in profit or loss.
(ii) Non-controlling interests Non-controlling interests are measured at their proportionate share of the acquiree’s identifiable net assets at the acquisition date. Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.
(iii) Subsidiaries Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidation financial statements from the date on which control commences until the date on which control ceases.
(iv) Loss of control When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and the related non-controlling interest and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost.
(v) Interests in equity-accounted investees The Group’s interests in equity-accounted investees comprise interests in associates and a joint venture.
Associates are those entities in which the Group has significant influence, but not control or joint control, over the financial and operating policies. A joint venture is an arrangement in which the Group has joint control, whereby the Group has rights to the net assets of the arrangements, rather than rights to its assets and obligations for its liabilities.
Interests in associates and joint venture are accounted for using the equity method. They are recognised initially at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income of equity- accounted investees, until the date on which significant influence or joint control ceases.
20 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(vi) Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated. Unrealised gains arising from transactions with equity-accounted investees are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
(b) Financial instruments All financial assets and liabilities are recognised in the statement of financial position and measuredin accordance with their assigned category.
(i) Non-derivative financial assets and financial liabilities – recognition and derecognition The Group initially recognises loans and receivables on the date when they are originated. All other financial assets and financial liabilities are initially recognised on the trade date, which is the date on which the Group becomes a party to the contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to cash flows from the asset expire, or when the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial assets are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognised financial assets that is created or retained by the Group is recognised as a separate asset or liability.
The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.
Financial assets and liabilities are offset and the net amount presented when and only when, the Group has a legal right to offset the amounts and intends either to settle them on a net basis or realise the asset and settle the liability simultaneously.
(ii) Non-derivative financial assets – measurement Loans and receivables comprises cash and cash equivalents, trade receivables, loans and advances to customers and other receivables.
Cash and cash equivalents comprise of cash on hand, bank balances and highly liquid short-term investments that are easily convertible into known amounts of cash and are subject to insignificant risks of changes in value.
Loans and receivables are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortised cost using the effective interest method less any impairment losses.
(iii) Non-derivative financial liabilities – measurement Non-derivative financial liabilities include interest-bearing loans and borrowings and trade and other payables.
Non-derivative financial liabilities are recognised at fair value less directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortised cost using the effective interest method.
Total Petroleum Ghana Limited • 21 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(c) Impairment
(i) Non-derivative financial assets Financial assets not classified as at fair value through profit or loss, including an interest in equity-accounted investee, are assessed at each reporting date to determine whether there is objective evidence of impairment.
Objective evidence that financial assets are impaired includes:
i. default or delinquency by a debtor.
ii. restructuring of an amount due to the Group on terms that the Group would not otherwise consider.
iii. indications that a debtor or issuer will enter bankruptcy.
iv. adverse changes in the payment status of borrowers or issuers.
v. the disappearance of an active market for a security or;
vi. observable data indicating a measurable decrease in expected cash flows from a group of financial assets.
Financial assets measured at amortised costs
The Group considers evidence of impairment for assets at both individual and collective levels. All individually significant assets are individually assessed for impairment. Those found not to be impaired are then collectively assessed for any impairment that has been incurred but not yet individually identified. Assets that are not individually significant are collectively assessed for impairment. Collective assessment is carried out by grouping together assets with similar risk characteristics.
In assessing collective impairment, the Group uses historical information on the timing of recoveries and the amounts of loss incurred and makes an adjustment if current economic and credit conditions are such that actual losses are likely to be greater or lesser than suggested by historical trends.
An impairment loss is calculated as the difference between an asset’s carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognised in profit or loss and reflected in an allowance account. When the Group considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the amount of impairment loss subsequently decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, then the previously recognised impairment loss is reversed through profit or loss.
Equity-accounted investees
An impairment loss in respect of an equity-accounted investee is measured by comparing the recoverable amount of the investment with its carrying amount. An impairment loss is recognised in profit or loss, and is reversed if there has been a favourable change in the estimates used to determine the recoverable amount.
(ii) Non-financial assets At each reporting date, the Group reviews the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication of impairment.
If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill is tested annually for impairment.
22 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of cash flows of other assets or CGUs. Goodwill arising on business combination is allocated to CGUs or group of CGUs that are expected to benefit from the synergies of the combination.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre- tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.
Impairment losses are recognised if the carrying amount of an asset or CGU exceeds its recoverable amount.
Impairment losses are recognised in profit or loss. They are first allocated to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amount of the other assets in the CGU on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
(d) Leases
(i) Leased assets Assets held by the Group under leases that transfer to the Group substantially all the risks and rewards of ownership of the underlying asset are classified as finance leases. Upon initial recognition the leased asset is measured at an amount equal to the lower of its fair value and present value of minimum lease payments. Subsequent to initial recognition, the leased asset is accounted for in accordance with the accounting policy applicable to that asset.
Other leases are classified as operating leases.
(ii) Lease payments Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease. Lease incentive received are recognised as an integral part of the total lease expense, over the term of the lease. When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an expense in the period in which termination takes place.
Minimum lease payments made under finance leases are apportioned between the finance expense and a reduction of the outstanding lease liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
(e) Property, plant and equipment
(i) Recognition and measurement Items of property, plant and equipment are initially recognised at cost and subsequently measured at cost less accumulated depreciation and impairment losses.
Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self- constructed assets includes the cost of materials and direct labour, and any other costs directly attributable to bringing the asset to a working condition for its intended use. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.
Total Petroleum Ghana Limited • 23 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.
(ii) Subsequent costs The cost of replacing part of an item of property, plant or equipment is recognised in the carrying amount of the item if it is probable that future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.
(iii) Depreciation Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term.
The estimated useful lives for the current and comparative periods are as follows:
Distribution and Service Station Plants - 10-20 years Furniture, Equipment and Motor Vehicles - 5-20 years
Depreciation methods, useful lives and residual values are reassessed at each reporting date. Gains and losses on disposal of property, plant and equipment are included in profit or loss.
(iii) Capital work in progress Property and equipment under construction is stated at initial cost and depreciated from the date the asset is made available for use over its estimated useful life. Assets are transferred from capital work in progress to an appropriate category of property and equipment when commissioned and ready for its intended use.
(f) Intangible assets
(i) Recognition and measurement Software acquired by the Group is initially recognised at cost and subsequently stated at cost less accumulated amortisation and accumulated impairment losses.
Goodwill arising on acquisition of subsidiaries represents the excess of acquisition costs over the Group’s interest in the fair value of net identifiable assets acquired. Goodwill is stated at cost less any accumulated impairment loss.
(ii) Subsequent expenditure Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.
24 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(iii) Amortisation Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-line method over their estimated useful lives, from the date that it is available for use. Amortisation is generally recognised in the profit or loss. Goodwill is not amortised, rather it is reviewed for impairment annually. Any impairment loss is charged to profit or loss.
The estimated useful life of software is four years.
Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
(g) Inventories Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the weighted average principle, and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less estimated selling expenses.
(h) Foreign currency Transactions in foreign currencies are translated to the respective functional currencies of Group entities at the foreign exchange rate ruling at the dates of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in profit or loss. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.
(i) Employee benefits
Defined contribution plans A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions to a separate entity and will have no legal or constructive obligation to pay future amounts. Obligations for contributions to defined contribution schemes are recognised as an expense in profit or loss when they are due.
Social security Under a national defined benefit pension scheme, the Group contributes 13% of employees’ basic salary to the Social Security and National Insurance Trust (SSNIT) for employee pensions under the terms of the Pension Act 2008 (Act 766). The company’s obligation is limited to the relevant contributions, which were settled on due dates. The pension liabilities and obligations, however, rest with SSNIT.
Provident fund (Defipro) The Group has a provident fund scheme for staff under which the Group contributes 10% of staff basic salary. The obligation under the plan is limited to the relevant contribution and these are settled on due dates to the fund manager.
Total Petroleum Ghana Limited • 25 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(j) Provisions A provision is recognised when the Group has a present legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at pre-tax rates that reflect risks specific to the liability.
(k) Revenue
(i) Sale of goods Revenue from the sale of goods is recognised at fair value of consideration received or receivable, net of returns, trade discounts, taxes and volume rebates. Revenue is recognised when significant risks and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, associated costs and the possible return of goods can be estimated reliably, there is no continuing management involvement in the goods and the amount of revenue can be measured reliably.
Revenue is recognised when customers lift petroleum products from designated depots and/or when products are delivered.
(l) Finance income and costs Finance income comprises interest income on funds invested and dividend income. Interest income is recognised in profit or loss using the effective interest method. Dividend income is recognised in profit or loss on the date that the Group’s right to receive payment is established.
Finance costs comprise interest expense on borrowings. All borrowing costs are recognised in profit or loss using the effective interest method.
(m) Income tax Income tax expense comprises current and deferred tax. The Group provides for income taxes at the current tax rates on the taxable profits of the Group.
Income tax is recognised in the profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
(i) Current tax Current tax is the expected tax payable on taxable income for the year, using tax rates enacted or substantially enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
(ii) Deferred tax Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes.
Deferred tax is measured at tax rates that are expected to be applied to temporary differences when they reverse, based on laws that have been enacted or substantively enacted by the reporting date.
A deferred tax asset is recognised for unused tax losses, unused tax credits and deductible temporary differences only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised such reductions are reversed when the probability of future taxable profits improves.
26 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(n) Dividend Dividend payable is recognised as a liability in the period in which they are declared.
(o) Segment reporting A segment is a distinguishable component of the Group that is engaged either in providing products or services (business segment), or in providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that are different from those of other segments. Segment results that are reported to the managing director include items directly attributed to a segment as well as those that can be allocated on a reasonable basis.
(p) Earnings per share The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.
(q) Stated capital Incremental costs directly attributable to the issue of ordinary shares, net of any tax effects, are recognised as deduction from equity.
(r) New standards and interpretations not yet adopted The following IFRSs have been issued but have not been applied by the Group in these financial statements. The following standards are those that may be relevant to the Group: i. Amendments to IAS 19 ‘Employee Benefits’ The amendments introduce relief that will reduce the complexity and burden of accounting for certain contributions from employees or third parties. Such contributions are eligible for practical expedient if they are:
• set out in the formal terms of the plan
• linked to service and
• independent of the number of years of service.
When contributions are eligible for practical expedient, a company is permitted (but not required) to recognise them as a reduction of the service cost in the period in which the related service is rendered. The amendments apply retrospectively for annual periods beginning on or after 1 July 2014 with early adoption permitted. This standard is not expected to have a significant impact on the Group’s financials. ii. IFRS 9 Financial Instruments This standard includes changes to the measurement bases of financial assets to amortised cost, fair value through other comprehensive income or fair value through profit or loss. Even though these measurement categories are similar to IAS 39, the criteria for classification into these categories are significantly different. In addition, the IFRS 9 impairment model has been changed from an
Total Petroleum Ghana Limited • 27 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) “incurred loss” model from IAS 39 to an “expected credit loss” model, which is expected to increase the provision for bad debts recognised in the Group. This standard will have a significant impact on the Group. The standard is effective for annual periods beginning on or after 1 January 2018 with retrospective application. iii. IFRS 15 Revenue from contracts with customers The standard contains a single model that applies to contracts with customers and two approaches to recognising revenue: at a point in time or over time. The model features a contract-based five-step analysis of transactions to determine whether, how much and when revenue is recognised. This new standard is not likely have a significant impact on the financial statements. The standard is effective for annual periods beginning on or after 1 January 2017.
(s) Borrowing costs General and specific borrowing costs directly attributable to the acquisition or construction of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the costs of those assets, until such time as the assets are substantially ready for their intended use.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred. 4. DETERMINATION OF FAIR VALUES
A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods described below. Where applicable, further information about the assumptions made in determining fair values is disclosed in notes specific to that asset or liability.
(i) Trade and other receivables The fair value of trade and other receivables is estimated as the present value of future cash flows, discounted at the current market rate of instruments with similar credit risk profile and maturity at the reporting date. Receivables due within a 6-month period are not discounted as the carrying values approximate their fair values.
(ii) Non-derivative financial liabilities Fair value, which is determined for disclosure purposes, is calculated on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date. Instruments with maturity periods of up to 6 months are not discounted as their carrying values approximate their fair values. 5. SEGMENT REPORTING
(i) Segmental information is presented in respect of the Group’s business segments. The primary format and business segments, is based on the Group’s management and internal reporting structure.
The Group’s results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly income-earning assets and revenue, interest-bearing loans, borrowings and expenses, and corporate assets and expenses which are managed centrally.
28 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
5. SEGMENT REPORTING (CONTINUED) The three main business segments reported are:
• Network
• Commercial sales
• Others
The Group does not have a geographical segment.
Group Company 2014 2014 Network Commercial Others Total Total GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Revenue 993,960 427,036 236,845 1,657,841 1,657,841 Cost of sales (930,570) (377,913) (232,224) (1,540,707) (1,540,707) Gross profit 63,390 49,123 4,621 117,134 117,134
Other income 15,344 12,402
Results before general, and administrative selling expenses 132,478 129,536 Unallocated expenses (82,193) (81,886)
Results from operating activities 50,285 47,650 Net finance costs (5,849) (5,849)
Profit before tax 44,436 41,801 Income tax (11,577) (10,841) Profit for the year 32,859 30,960
Total assets 405,656 383,151
Total liabilities 282,967 262,334
Other segment items Depreciation and amortisation 10,888 10,888
Total Petroleum Ghana Limited • 29 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
5. SEGMENT REPORTING (CONTINUED)
Group Company 2013 2013 Network Commercial Others Total Total GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Revenue 705,046 399,848 233,261 1,338,155 1,338,155 Cost of sales (650,093) (365,852) (221,057) (1,237,002) (1,237,002)
Gross profit 54,953 33,996 12,204 101,153 101,153
Other income 14,621 13,659
Results before general, and administrative selling expenses 115,774 114,812 Unallocated expenses (69,755) (69,632)
Results from operating activities 46,019 45,180 Net finance income 1,557 1,557
Profit before tax 47,576 46,737 Income tax (11,031) (11,031) Profit for the year 36,545 35,706
Total assets 344,077 338,084
Total liabilities 234,602 234,582
Other segment items Depreciation and amortisation 8,901 8,901
30 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
6. Revenue
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Gross sales value 1,657,841 1,338,155 1,657,841 1,338,155 7. Other income
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Rent income 2,915 2,410 2,915 2,410 Profit on disposal of plant and equipment 188 486 188 486 Foreign exchange gains 2,942 962 - - Sundry income 9,299 10,763 9,299 10,763 15,344 14,621 12,402 13,659
8. PROFIT BEFORE TAX is stated After charging
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Cost of sales Inventory movement 1,331,518 1,077,848 1,331,518 1,077,848 Transportation 45,196 41,663 45,196 41,663 Import duties 161,380 114,617 161,380 114,617 Other costs 2,613 2,874 2,613 2,874 1,540,707 1,237,002 1,540,707 1,237,002
General, administrative and selling expense Personnel costs (note 9) 25,738 17,482 25,496 17,436 Auditor’s remuneration 156 82 128 82 Depreciation 10,780 8,901 10,780 8,901 Amortisation of software 108 116 108 116 Directors’ emoluments 709 620 709 620 Donations 826 239 826 239 Technical assistance from group 10,384 6,550 10,384 6,550 Maintenance cost 7,379 5,974 7,379 5,974 Rental cost 6,721 6,123 6,721 6,123 Other cost 19,392 23,668 19,355 23,591 82,193 69,755 81,886 69,632
Total Petroleum Ghana Limited • 31 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
9. Personnel costs
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Wages and salaries 14,293 12,835 14,051 12,789 Social security contributions 863 704 863 704 Provident fund (Defipro) 696 619 696 619 Other staff expenses 9,886 3,324 9,886 3,324 25,738 17,482 25,496 17,436
The average number of persons employed by the Group during the year was 192 (2013: 195). 10. Taxation
(i) Income tax expense Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Current tax expense (note 10(ii)) 11,464 13,779 11,464 13,779 Deferred tax expense (note (11)) 113 (2,748) (623) (2,748) 11,577 11,031 10,841 11,031
Deferred tax expense relates to the origination and reversals of temporary differences.
Group and Company
(ii) Taxation payable/(receivable) Balance at Payments Charged to Balance at 1/1/14 during the P/L account 31/12/14 year GH¢’000 GH¢’000 GH¢’000 GH¢’000 Income Tax Up to 2011 69 - - 69 2014 - (15,668) 11,464 (4,204) Withholding Tax (675) (216) - (891) National Reconstruction Levy Up to 2006 (29) - - (29) (635) (15,884) 11,464 (5,055)
The tax liabilities are subject to agreement with the tax authorities.
National Reconstruction Levy: This relates to a levy imposed on companies by the Government on profits before tax between 2001 and 2005. This levy has been abolished.
32 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
10. Taxation (continued)
(iii) Reconciliation of effective tax rate Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Profit before taxation 44,436 47,576 41,801 46,737
Income tax using the domestic tax rate (25%) 11,109 11,894 10,450 11,684 Non-deductible expenses 468 (863) 391 (653)
Total tax charge 11,577 11,031 10,841 11,031
Effective tax rate 26% 23% 26% 24% 11. Deferred Taxation
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 Balance at 1 January 894 3,642 894 3,642 Credit/(charge) to profit or loss for the year 113 (2,748) (623) (2,748)
Balance at 31 December 1,007 894 271 894 Recognised deferred tax assets and liabilities are attributable to the following:
Group 2014 2013 Assets Liabilities Net Assets Liabilities Net GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Property, plant and equipment 5,988 - 5,988 - 5,315 5,315 Other items - (4,981) (4,981) (4,421) - (4,421)
Net tax (assets)/liabilities 5,988 (4,981) 1,007 (4,421) 5,315 894
Company Property, plant and equipment 5,988 - 5,988 - 5,315 5,315 Other items - (5,717) (5,717) (4,421) - (4,421)
Net tax (assets)/liabilities 5,988 (5,717) 271 (4,421) 5,315 894
Total Petroleum Ghana Limited • 33 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
12. Property, Plant and Equipment
Group 2014 Distribution Furniture Capital Leasehold Service Equipment Work-in Total Properties Station & Motor Progress Plants Vehicles GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Cost At 1/1/2014 35,836 60,421 12,265 29,711 138,233 Additions 594 1,083 715 53,490 55,882 Transfers 8,094 11,903 128 (20,125) - Disposals - (56) (416) - (472)
At 31/12/2014 44,524 73,351 12,692 63,076 193,643
Accumulated depreciation At 1/1/2014 10,868 29,212 6,411 - 46,491 Charge for the year 2,262 6,695 1,823 - 10,780 Released on disposals - - (406) - (406) At 31/12/2014 13,130 35,907 7,828 - 56,865
Carrying amount At 31/12/2014 31,394 37,444 4,864 63,076 136,778
At 1/1/2014 24,968 31,209 5,854 29,711 91,742
34 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
12. Property, Plant and Equipment (continued)
Group 2013 Distribution Furniture Capital Leasehold Service Equipment Work-in Total Properties Station & Motor Progress Plants Vehicles GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Cost At 1/1/2013 32,564 58,106 8,038 12,972 111,680 Additions 731 1,376 1,573 24,740 28,420 Transfers 2,985 1,209 3,058 (7,252) - Reclassification - - - (749) (749) Disposals (444) (270) (404) - (1,118)
At 31/12/2013 35,836 60,421 12,265 29,711 138,233
Accumulated depreciation At 1/1/2013 8,984 23,856 5,122 - 37,962 Charge for the year 1,885 5,599 1,417 - 8,901 Released on disposals (1) (243) (128) - (372) At 31/12/2013 10,868 29,212 6,411 - 46,491
Carrying amount At 31/12/2013 24,968 31,209 5,854 29,711 91,742
At 1/1/2013 23,580 34,250 2,916 12,972 73,718
Total Petroleum Ghana Limited • 35 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
12. Property, Plant and Equipment (continued)
Company 2014 Distribution Furniture Capital Leasehold Service Equipment Work-in Total Properties Station & Motor Progress Plants Vehicles GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Cost At 1/1/2014 35,836 60,421 12,265 29,229 137,751 Additions 594 1,083 715 27,612 30,004 Transfers 8,094 11,903 128 (20,125) - Disposals - (56) (416) - (472)
At 31/12/2014 44,524 73,351 12,692 36,716 167,283
Accumulated depreciation At 1/1/2014 10,868 29,212 6,411 - 46,491 Charge for the year 2,262 6,695 1,823 - 10,780 Released on disposals - - (406) - (406) At 31/12/2014 13,130 35,907 7,828 - 56,865
Carrying amount At 31/12/2014 31,394 37,444 4,864 36,716 110,418
At 1/1/2014 24,968 31,209 5,854 29,229 91,260
36 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
12. Property, Plant and Equipment (continued)
Company 2013 Distribution Furniture Capital Leasehold Service Equipment Work-in Total Properties Station & Motor Progress Plants Vehicles GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Cost At 1/1/2013 32,564 58,106 8,038 12,972 111,680 Additions 731 1,376 1,573 24,258 27,938 Transfers 2,985 1,209 3,058 (7,252) - Reclassification (see note 13) - - - (749) (749) Disposals (444) (270) (404) - (1,118)
At 31/12/2013 35,836 60,421 12,265 29,229 137,751 Accumulated depreciation At 1/1/2013 8,984 23,856 5,122 - 37,962 Charge for the year 1,885 5,599 1,417 - 8,901 Released on disposals (1) (243) (128) - (372) At 31/12/2013 10,868 29,212 6,411 - 46,491 Carrying amount At 31/12/2013 24,968 31,209 5,854 29,229 91,260
At 1/1/2013 23,580 34,250 2,916 12,972 73,718
Profit on disposal of plant and equipment Company Company 2014 2013 GH¢’000 GH¢’000 Cost 472 1,118 Accumulated depreciation (406) (372)
Net book value 66 746 Sale proceeds (254) (1,232) Profit on disposal (188) (486) a. Assets under construction The Group has started constructing a Tank Farm to be used by Ghanstock Limited for its operations. Costs incurred up to 31 December 2014 totalled GH¢26,360,000 (2013: GH¢482,000). The remaining balance of GH¢36,716,000 (2013: GH¢29,229,000) relates to the construction of new service stations and major renovations to existing service stations.
Total Petroleum Ghana Limited • 37 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
12. Property, Plant and Equipment (continued) b. Security Ghanstock Limited’s Tank Farm, which is currently under construction with total costs of GH¢26,360,000 has been pledged as a security for the bank loan obtained during the year (see note 21).
The Company’s property with title number WR.412/13 situated at Takoradi, Ghana has been pledged as a security for the loan obtained by Ghanstock Limited. 13. Intangible Assets
Group and Company 2014 2013 GH¢’000 GH¢’000 Software (Note 13(a)) 1,431 916 Goodwill (Note 13(b)) 12,083 12,083
13,514 12,999
(a) Software Cost Balance at 1 January 2,143 1,111 Additions 623 283 Transfers from WIP (see note 12) - 749
Balance at 31 December 2,766 2,143
Amortisation Balance at 1 January 1,227 1,111 Amortisation for the year 108 116
Balance at 31 December 1,335 1,227
Carrying amount At 31 December 1,431 916
38 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
13. Intangible Assets (continued)
Group and Company 2014 2013 GH¢’000 GH¢’000 (b) GOODWILL Cost Balance at 1 January 15,092 15,092 Balance at 31 December 15,092 15,092
Impairment Balance at 1 January 3,009 3,009 Charge for the year - Balance at 31 December 3,009 3,009
Carrying amount At 31 December 12,083 12,083
This relates to goodwill arising on the acquisition of Total Ghana Limited in 2006. 14. Investments
(a) Associates Group and Company 2014 2013 GH¢’000 GH¢’000 Investments in associated companies
Ghana Bunkering Services Limited 12 12 Road Safety Limited (RSL) - - 12 12
This represents investments in:
Ghana Bunkering Services Limited The investment in Ghana Bunkering Limited represents shares, held by the company conferring the right to exercise 48.5% of votes exercisable at general meetings. Ghana Bunkering Services Limited is a company incorporated in Ghana to provide bunkering services to petroleum marketers in the country.
Road Safety Limited (RSL) The company has a 50% interest in RSL (formerly, Petroleum Road Transport Safety Limited), a company incorporated in Ghana. Its principal business is to provide driver education and maintenance services for the haulage of petroleum products.
The directors of the Group are of the view that the results of the above associates are very immaterial to the group and as such the results of these entities have not been included in the consolidated financial statements. The table below summarises the net income and net assets of these associates at the end of the year.
Total Petroleum Ghana Limited • 39 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
14. Investments (continued)
Total Group’s Total Group’ Share share 2014 2014 2013 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Net income: Ghana Bunkering Services Limited 555 277 559 271 Road Safety Limited 31 15 190 95 586 292 749 366
Net assets: Ghana Bunkering Services Limited 2,775 1,346 2,220 1,077 Road Safety Limited 682 341 651 326 3,457 1,687 2,871 1,403
(b) Subsidiaries Group
The Group has a 55% interest in Ghanstock Limited, a company incorporated authorised to build, own, operate and maintain petroleum storage facilities.
Company 2014 2013 2014 2013 GH¢’000 GH¢’000 Interest Interest Investment in subsidiary 6,274 6,274 55% 55% 15. Inventories
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Trading Lubricants 27,938 29,049 27,938 29,049 Bitumen 8,560 10,354 8,560 10,354 Fuel 11,646 9,385 11,646 9,385 Additives 7,450 12,122 7,450 12,122 Stock in transit 6,996 15,236 6,996 15,236 Special fluid 258 446 258 446 62,848 76,592 62,848 76,592 Non-Trading Consumables 3,404 4,930 3,404 4,930 Packing materials 2,671 2,190 2,671 2,190 68,923 83,712 68,923 83,712
40 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
16. Trade and other receivables
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Trade receivables 146,639 121,404 146,639 121,404 Other receivables 9,198 4,483 9,124 4,971 Prepayments 547 108 547 107 156,384 125,995 156,310 126,482 17. Cash and cash equivalents
Cash at hand 1 1 1 1 Cash at bank 12,196 20,620 8,872 8,348
Cash and bank balances 12,197 20,621 8,873 8,349 Bank overdrafts used for cash management purposes (45,307) (8,693) (45,307) (8,693)
Cash and cash equivalent in statement of cash flows (33,110) 11,928 (36,434) (344) 18. Stated Capital
Group and Company Group and Company 2014 2014 2013 2013 GH¢’000 GH¢’000 No. of Shares Proceeds No. of Shares Proceeds Authorised: Ordinary Shares of no par value 250,000,000 250,000,000
Issued and fully paid For cash 610,000 22 610,000 22 For consideration other than cash 10,069,259 49,694 10,069,259 49,694 Capitalisation issue 101,194,813 1,506 101,194,813 1,506 111,874,072 51,222 111,874,072 51,222
The holders of ordinary shares are entitled to receive dividend as declared from time to time and are entitled to one vote per share at meetings of the company. There is no call or instalment unpaid on any share and there are no shares in treasury.
Further to the approval by the shareholders of Total Petroleum Ghana Limited at its Annual General Meeting (AGM) held on June 26, 2013, a bonus issue to its shareholders in a ratio of seven (7) new shares for every one (1) existing share held was made.
Total Petroleum Ghana Limited • 41 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
19. Earnings Per Share
Basic Basic earnings per share is calculated by dividing the net profit attributable to equity holders of the company by the weighted average number of shares in issue during the year.
Group Group Company Company 2014 2013 2014 2013 Profit attributable to equity holders of the Company (expressed in GH¢’000) 32,004 36,168 30,960 35,706
Weighted average number of ordinary shares in issue 111,874,072 111,874,072 111,874,072 111,874,072
Basic earnings per share (expressed in GH¢ per 0.2861 0.3233 0.2767 0.3192 share)
Diluted earnings per share (expressed in GH¢ per 0.2861 0.3233 0.2767 0.3192 share)
Diluted Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares, to assume all dilutive potential ordinary shares. At 31 December 2014 and 2013, the company had no dilutive potential ordinary shares. 20. Trade and other payables
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Trade payables 153,298 180,753 152,223 180,753 Non-trade payables 40,045 18,007 40,020 17,987 Accrued expenses 3,193 2,780 3,194 2,780 196,536 201,540 195,437 201,520 21. Loans and Borrowings
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Current Secured bank loans 604 - - -
Non-current Secured bank loans 13,173 - - -
42 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
21. Loans and Borrowings (continued) Terms and debt repayment schedule
Group Carrying Face Value value 2014 Year of 2014 2014 Currency Maturity GH¢’000 GH¢’000 Secured bank loans GH¢ 2020 13,777 14,222
This relates to drawn down balance of a Barclays Bank of Ghana Limited facility of GH¢59,445,431 dated 10 September 2014 for the construction of a Tank Farm at Takoradi, Ghana. The facility has a tenure of 6 years and attracts interest at Base Rate plus a margin of 6.58%.
Repayment of the loan plus interest is to be made in accordance with predefined repayment schedule. The facility has the following as security:
a. Corporate guarantee of GH¢32,694,999 from Total Petroleum Ghana Limited.
b. Corporate guarantee of GH¢26,750,454 from Fueltrade Limited.
c. Fixed and floating charge debenture in Barclays Bank’s standard form covering Tank Farm.
d. Charge of GH¢8,800,000 over Total Petroleum Ghana Limited’s property title WR.412/13 situated at Takoradi, Ghana. 22. Provisions
Group and Company 2014 2013 GH¢’000 GH¢’000 Balance at 1 January - - Provisions made during the year 7,470 - Payments made during the year (1,450) - 6,020 -
Current 3,325 - Non-current 2,695 - 6,020 -
During the year the Group committed to a plan to restructure its workforce through voluntary early retirement. Following the announcement of the plan, the Group recognised a provision of GH¢6,949,881 for expected costs. Estimated costs were based on the terms of the relevant agreements signed by the relevant employees and the company. The unutilized portion of this balance at the year end was GH¢5,500,000.
A legal provision of GH¢519,000 was recognised during the year in respect of legal cases where judgement was issued against the company.
Total Petroleum Ghana Limited • 43 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
23. Financial Risk Management
(i) Overview The Group has exposure to the following risks from its use of financial instruments:
• credit risk
• liquidity risk
• market risks
This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies, and processes for measuring and managing risk, and the Group’s management of capital.
Risk management framework The board of directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The board’s audit committee is responsible for monitoring compliance with the Group’s risk management policies and procedures, and for reviewing the adequacy of the risk management framework in relation to the risks faced by the company.
The Group’s risk management policies are established to identify and analyse 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, products and services offered.
The Group, through its training and management standards and procedures, continues to develop a disciplined and constructive control environment, in which all employees understand their roles and obligations.
The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.
The Audit Committee gain assurance in relation to the effectiveness of internal control and the risk management framework from: summary information in relation to the management of identified risks detailed review of the effectiveness of management of selected key risks results of management’s self-assessment process over internal control and the independent work of the internal audit department, which ensures that the Audit Committee and management understand the Group’s key risks and risk management capability sets standards on governance and compliance and provides assurance over the quality of the Group’s internal control and management of key risks.
(ii) 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 company’s receivable from customers.
Exposure to credit risks The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Trade receivables 146,639 121,404 146,639 121,404 Cash and cash equivalents 12,196 20,620 8,872 8,348 158,835 142,024 155,511 129,752
44 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
23. Financial Risk Management (continued)
Trade and other receivables The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The credit control committee has established a credit policy under which a new customer is analysed individually for credit worthiness before the Group’s standard payment terms and conditions are offered. The Group generally trades with pre-defined and selected customers. Credit exposure on trade receivable is covered by customers issuing post-dated cheques to cover amount owed, as well the use of customer’s security deposits.
Impairment losses The Group establishes an allowance for impairment losses that represents its estimate of incurred losses in respect of trade and other receivables. This allowance relates to individually significant exposures.
The aging of trade receivables, amounts due from related parties and other receivables at the reporting date was:
Group and Company Group and Company 2014 2014 2013 2013 Gross Impairment Gross Impairment GH¢’000 GH¢’000 GH¢’000 GH¢’000 Neither past due nor impaired (less than 30 days) 126,836 - 70,943 - Past due (30-90 days) 14,867 - 43,599 - Individually impaired (more than 90 days) 18,304 13,368 19,405 12,543 160,007 13,368 133,947 12,543
Management believes that the unimpaired amounts that are past due by more than 30 days but less than 90 days are still collectible in full, based on historic payment behaviour and extensive analysis of customer credit risk, including underlying customers’ credit worthiness.
The movement in the allowance in respect of trade receivables during the year was as follows:
Group and Company 2014 2013 GH¢’000 GH¢’000 Balance at 1 January 12,543 13,208 Impairment loss recognised 825 500 Less: Bad debts written-off - (1,165) Balance at 31 December 13,368 12,543
The allowance account for trade receivables and other receivables is used to record impairment losses unless the Group is satisfied that no recovery of the amount owing is possible at which point the amounts considered irrecoverable are written off against trade receivables directly.
No impairment loss was recognised for financial assets other than trade receivables.
Total Petroleum Ghana Limited • 45 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
23. Financial Risk Management (continued)
Cash and cash equivalents
Group The Group held cash and cash equivalents of GH¢12,196,000 (2013: GH¢20,620,000) at the reporting date with banks and financial institution counterparties, which are assessed as having a relatively good credit rating.
Company The Group held cash and cash equivalents of GH¢8,872,000 (2013: GH¢8,348,000) at the reporting date with banks and financial institution counterparties, which are assessed as having a relatively good credit rating.
(iii) Liquidity risk Liquidity risk is the risk that the Group either does not have sufficient financial resources available to meet all its obligations and commitments as they fall due, or can access them only at excessive cost. The Group’s approach to managing liquidity is to ensure that it will maintain adequate liquidity to meet its liabilities when due.
In addition, the Group and Company maintains the following lines of credit:
a) Ecobank Ghana Limited
The company has an unsecured overdraft facility not exceeding GH¢10 million with Ecobank to finance the company’s receivables, additions to inventories and other operational bills. The facility expires on 31 Jan 2015.
b) Standard Chartered Bank Ghana Limited
The company has an unsecured overdraft facility of GH¢25 million with Standard Chartered Bank Ghana Limited to finance working capital.
c) Societe Generale Ghana Limited
The company has an unsecured overdraft facility of GH¢17 million with Societe Generale Ghana Limited to augment working capital. The facility expires on 30 September 2015.
d) Barclays Bank Ghana Limited
The company has an unsecured overdraft facility of GH¢10 million with Barclays Bank Ghana Limited to finance working capital.
e) Stanbic Bank Limited
The company has an unsecured overdraft facility of GH¢5 million with Stanbic Bank Limited to finance working capital.
46 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
23. Financial Risk Management (continued)
Exposure to liquidity The following are the contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted, and include estimated interest payments.
Group Carrying Contractual 1 year 1 to 2 to 5 years 2014 amounts cashflows or less 2 years 5 years and over GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Non-derivative financial liabilities Secured bank loans (GH¢) 13,777 27,195 5,096 6,144 13,818 2,137 Amount due to related companies 20,320 20,320 20,320 - - - Bank overdrafts 45,307 45,307 45,307 - - - Trade and other payables 196,536 196,536 196,536 - - - 275,940 289,358 267,259 6,144 13,818 2,137
2013 Non-derivative financial liabilities Amount due to related companies 24,788 24,788 24,788 - - - Bank overdrafts 8,693 8,693 8,693 - - - Trade and other payables 201,540 201,540 201,540 - - - 235,021 235,021 235,021 - - -
Company Non-derivative financial liabilities Amount due to related companies 21,299 21,299 21,299 - - - Bank overdrafts 45,307 45,307 45,307 - - - Trade and other payables 195,437 195,437 195,437 - - - 262,043 262,043 262,043 - - -
Group 2013 Non-derivative financial liabilities Amount due to related companies 24,788 24,788 24,788 - - - Bank overdrafts 8,693 8,693 8,693 - - - Trade and other payables 201,520 201,520 201,520 - - - 235,001 235,001 235,001 - - -
(iv) Market risks Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising returns.
Total Petroleum Ghana Limited • 47 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
23. Financial Risk Management (continued)
Foreign currency risk The Group is exposed to currency risk on purchases and borrowings that are denominated in currencies other than the functional currency. The currencies in which these transactions primarily are denominated are Euro and US Dollars.
Exposure to currency risk The Group’s exposure to foreign currency risk was as follows based on notional amounts:
euro USD CFA CHF ’000 $’000 CFA’000 CHF’000 Group and Company 31 December 2014 Trade and other payables (1,776) (9,269) (9) - Amounts due to related parties (1,711) (2,198) (214) 26
Cash and cash equivalents 64 2,547 - - Trade and other receivables 49 12,162 2,948 - Gross exposure (3,374) 3,242 2,725 26 Group and Company 31 December 2013 Trade and other payables (3,720) (23,689) - - Intercompany balances (632) 327 - - Bank balances 176 2,212 - - Trade and other receivables - 19,946 - - Gross exposure (4,176) (1,204) - -
The following exchange rates applied during the year:
Average Rate Reporting Rate 2014 2013 2014 2013 Ghana Cedi: Euro 1 4.0252 2.7271 3.8970 2.9878 USD 1 3.0367 2.0518 3.2013 2.1628 CFA 1 0.0061 0.0042 0.0059 0.0049 CHF 1 3.3153 2.2150 3.2294 2.6520
Sensitivity analysis on currency risks The following table shows the effect of a strengthening or weakening of GH¢ against all other currencies on the Group’s equity and profit or loss. This sensitivity analysis indicates the potential effect on equity and profit or loss based upon the foreign currency exposures recorded at December 31 (see “currency risk” above), and it does not represent actual or future gains or losses. The sensitivity analysis is based on the percentage difference between the highest daily exchange rate and the average exchange rate per currency recorded in the course of the respective financial year.
A strengthening/ weakening of the GH¢, by the rates shown in the table, against the following currencies at 31 December have increased/decreased equity and profit or loss by the amounts shown below.
48 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
23. Financial Risk Management (continued) This analysis assumes that all other variables, in particular interest rates, remain constant.
As of 31 December 2014 2013 In GH¢ % Strengthening: Weakening: % Strengthening: Strengthening: Change Impact on equity Impact on Change Impact on equity Impact on equity and profit or equity and and profit or and profit or loss - increase/ profit or loss loss - increase/ loss - increase/ (decrease) - increase/ (decrease) (decrease) (decrease) GH¢’000 GH¢’000 GH¢’000 GH¢’000 Euro 23% (3,024) 3,024 18% (2,246) 2,246 US$ 24% 2,491 (2,504) 14% (385) 385 CFA 23% 4 (4) 17% - - CHF 23% 19 (19) 19% - -
Interest rate risk An increase or decrease in interest rates would have no impact on equity and profit or loss as the finance cost associated with the secured bank loan is capitalised as part of the cost of the qualifying item of plant, property and equipment.
Fair values
Fair values versus carrying amounts The fair values of financial assets and liabilities, together with the carrying amounts shown in the balance sheet, are as follows:
Group Group Company Company 2014 2013 2014 2013 Carrying Fair Carrying Fair Carrying Fair Carrying Fair (i) Loans and receivables Amount Value Value Value Amount Value Amount Value GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Trade and other receivables 155,837 155,837 125,887 125,887 155,763 155,763 126,375 126,375 Amounts due from related parties 2,029 2,029 1,313 1,313 3,008 3,008 1,313 1,313 Cash and cash equivalents 12,197 12,197 20,621 20,621 8,873 8,873 8,349 8,349 170,063 170,063 147,821 147,821 167,644 167,644 136,037 136,037
(ii) Financial liabilities Secured bank loans 13,777 14,222 ------Trade and other payables 196,536 196,536 201,540 201,540 195,437 195,437 201,520 201,520 Amounts due from related parties 20,320 20,320 24,788 24,788 21,299 21,299 24,788 24,788 Bank overdraft 45,307 45,307 8,693 8,693 45,307 45,307 8,693 8,693 275,940 276,385 235,021 235,021 262,043 262,043 235,001 235,001
Total Petroleum Ghana Limited • 49 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
24. Related Party Transactions
i. The company is a subsidiary of Total Outre-Mer S. A., a company incorporated in France.
ii. Chemical additives, bitumen and consumables costing GH¢65,732,000 (2013: GH¢91,979,000) were procured from Total Outre-Mer S. A. during the year.
iii Included in general and administrative expenses is an amount of GH¢10,384,000 (2013: GH¢6,550,000) in respect of technical assistance fee payable to Total Outre-Mer S. A.
iv. Total amount paid to directors was GH¢709,000 (2013: GH¢620,000). The compensation of the Group’s directors includes salaries, allowances and contribution to defined contribution pension scheme.
Outstanding balances in respect of transactions with related parties at the year-end were as follows:
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Amount due from related parties 2,029 1,313 3,008 1,313 Amount due to related parties (20,320) (24,788) (21,299) (24,788) (18,291) (23,475) (18,291) (23,475)
All transactions with related parties are priced on an arm’s length basis and are to be settled before the end of the next reporting date. None of the balances is secured. No expense has been recognised in the current and prior year for bad and doubtful debts in respect of amounts owed by related parties. 25. Long Term Leases
Group and Company 2014 2013 GH¢’000 GH¢’000 Balance at 1 January 8,361 5,652 Additions for the year 3,936 3,887 Amortisation for the year (989) (1,178) Transfer (Short term lease) * (544) - Balance at 31 December 10,764 8,361
The long term leases relate to payments made for lands acquired for the construction of various service stations used. The lease terms of these lands ranges from 3 years to 50 years. These leases are amortized over the life of each lease term.
*This has been included as part of prepayments in note 16.
50 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
26. Operating And Capital Commitments
(a) Operating leases
Non-cancellable operating lease rentals are payable as follows: Group and Company 2014 2013 GH¢’000 GH¢’000 Less than one year 2,442 2,538 Between one and five years 203 173 2,645 2,711
(b) Capital commitments Commitments for capital expenditure at the reporting date were:
2014 2013 GH¢’000 GH¢’000 Group 23,877 2,890 Company - 2,890 27. Employee Benefits Defined Contribution Plans
(i) Social Security Under a national defined benefit pension scheme, the Group contributes 13% of employees’ basic salary to the Social Security and National Insurance Trust (SSNIT) for employee pensions. The Group’s obligation is limited to the relevant contributions, which were settled on due dates. The pension liabilities and obligations, however, rest with SSNIT. The expense charged to the profit or loss during current year is:
2014 2013 GH¢’000 GH¢’000 Group and Company 863 704
(ii) Provident Fund (Defipro) The Group has a provident fund scheme for staff under which the Group contributes 10% of staff basic salary. The Group’s obligation under the plan is limited to the relevant contribution and these are settled on due the dates to the fund manager.
2014 2013 GH¢’000 GH¢’000 Group and Company 696 619
Total Petroleum Ghana Limited • 51 Annual Report & Financial Statement 10 for the year ended 31st December, 2014 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
28. Capital Management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern. The Group monitors capital using the ratio of adjusted net debt to equity. For this purpose, adjusted net debt is defined as total liabilities, comprising interest-bearing loans and borrowings less cash and cash equivalents. Equity comprises of all components of equity.
The Group’s policy is to keep a ratio of below 3.00.
The Group’s adjusted net debt to equity at the reporting date was as follows:
Group Group Company Company 2014 2013 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Total liabilities 282,967 235,915 268,334 235,895 Less: Cash and cash equivalents 12,197 20,621 8,873 8,349
Net debt 270,770 215,294 259,461 227,546
Total equity 122,689 109,475 114,817 103,502
Net debt to equity ratio 2.21 1.97 2.26 2.20
52 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 10 Notes To The Financial Statements For The Year Ended 31 December 2014 (continued)
SHAREHOLDING INFORMATION
(i) Number of shares in issue Earnings and dividend per share are based on 111,874,072 (2013: 111,874,072) ordinary shares in issue during the year.
(ii) Number of shareholders The company had 111,874,072 ordinary shareholders at 31 December 2014 distributed as follows:
Holding No. of holders Total holding % Holding 1 - 1,000 2,633 930,582 0.83 1,001 - 5,000 1,599 3,909,250 3.50 5,001 - 10,000 282 1,834,581 1.64 10,001 and over 152 105,199,659 94.03 4,666 111,874,072 100.00
(iii) List of twenty largest shareholders as at 31 December 2014 Number of Shareholdings shares % Total Outre Mer S.A. 48,802,560 43.62 Total Africa Limited 37,047,592 33.12 National Investment Bank 9,959,032 8.90 Security & National Insurance Trust 2,923,544 2.61 Ghana Oil Company Limited 1,040,528 0.93 SCBN/ELAC Policy Holders Fund 694,800 0.62 SCGN/ EPAC Investment Fund. 266,100 0.24 SCGN/CACEIS France RE HMG GLOBETRO 250,000 0.22 Damsel/Dorothy Taylor Kwabi 208,580 0.19 Estate of the late Dr. J. A. Blankson 201,992 0.18 SSNIT SOS Fund 159,920 0.14 HFC/EDC Ghana Balanced Fund Ltd 158,544 0.14 SCBN/Ghana Medical Association Pension Fund 155,200 0.14 NTHC Limited 137,816 0.12 STD NOMS TVL PTY/Enterprise Tier 3 100,000 0.09 * Mrs M. A. Samson 91,811 0.08 SCBN/ Databank Balanced Fund Ltd 84,000 0.08 Mr. J.C.K. Blagogee 82,240 0.07 Mr.B.K Glymin Jnr 81,032 0.07 Damsel/Oteng-Gyasi Anthony 78,016 0.07 REPORTED TOTALS 102,523,307 91.63 NOT REPORTED 9,350,765 8.37 GRAND TOTALS 111,874,072 100 *This shareholder is also an employee of the Company with Management Position * All shareholders have equal voting rights.
Total Petroleum Ghana Limited • 53 Annual Report & Financial Statement 11 for the year ended 31st December, 2014 Resolutions
Board Resolutions The Board of Directors will be proposing the following resolutions, which will be put to the Annual General Meeting 2015:
Ordinary Resolutions 1. To receive and consider the Reports of the Directors, Auditors and the Financial Statements of the Company for the year ended 31st December, 2014. The Board will propose for consideration and adoption the Reports of the Directors, Auditors thereon as a true and fair view of the Financial Statements of the Company for the year ended 31st December, 2014.
2. To declare a final Dividend. The Board will recommend for approval a final dividend of GH¢ 0.0984 per share for the year ended 31st December, 2014 which, if approved will be paid on 15th July, 2015 to Shareholders on the register of members of the Company on 30th June, 2015.
3. To Ratify the Appointment of Directors. The Board will request the Shareholders to approve the appointment of the following Directors:
• Mr. Olivier Van Parys who has filled the vacancy created by the resignation of Mr. Guillaume Larroque.
• Mr. Martin Amenyedzi who has filled the vacancy created by the resignation of Mr. S. Manu Asiama.
• Messrs. O. Van Parys and M. Amenyedzi have each consented and expressed their willingness to be appointed as Directors in accordance with section 181 of the Companies Code.
4. To Re-Elect Directors retiring by rotation. The following Directors, Messrs. Thibault de Langlais, Gerard Pruneau and Edward Patrick Larbi Gyampoh will retire in accordance with Section 298 (b) (d) of the Companies Code 1963, Act 179 and Regulation 61 of the Company’s Regulations. Each of them is eligible for re-election and have expressed their desire to be re-elected as Directors of the Company.
5. To Approve the remuneration of Directors. In accordance with Section 194 of the Companies Act, 1963 (Act 179), the Board will request that Shareholders approve the remuneration of Directors.
6. To Authorise the Directors to fix the Remuneration of the Auditors. The Board will request that the Directors are authorized to fix the remuneration of KPMG, the Auditors of the Company.
Special Resolution 7. To Amend the Regulations of the Company by adding a new business objective. In accordance with Section 22 of the Companies Act, 1963 (Act 179), the Board will request that Shareholders approve an amendment to the Company’s Regulations by the addition of a new business objective as follows:
• ‘(g) To engage in the production and distribution of Solar Energy and other forms of Renewable Energy.’
And that the Company adopts the new amendments accordingly.
54 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 12 Extract Of Code Of Conduct
Business Principles: Total is a world-class oil, gas and chemicals group with industrial and commercial operations spanning oil, gas, power generation, renewable energies and chemicals in more than 130 countries. Our growth is based on shared core values.
As possible industrial group, Total is committed to supporting efficient and properly managed utilization of our energy sources and products. We take into account the needs of today’s consumers and the interest of future generations through an active policy of environmental stewardship that is an integral part of our sustainable development strategy.
We provide regular and transparent reports.
These business principles are our reference point and go hand-in-hand with the objective of continued growth, benefiting shareholders, customers and employees, and contributing to the economic and social development of the countries where we operate.
As a general principle, Total: Observes the decisions of the United Nations and the European Union, especially with regard to the choice of where to set up operations.
Is sensitive to the concerns expressed by international, European Union, government and non-governmental organizations in matters concerning our operations.
Observes the rules of free competition.
Rejects bribery and corruption in all forms, whether public or private, active or passive.
Total strives to uphold: • The principles of the universal Declaration of Human Rights.
• The key conventions of the International Labour Organization.
• The OECD Guidelines for Mwltinational Enterprises.
• The principles of the United Nations Global Compact.
Shareholders Total strives to earn the confidence of its shareholders, with the objective of providing them with a profitable investment.
We regularly provide full and transparent information to all shareholders and are attentive to their concerns, especially through the Shareholders Advisory Committee,
We comply strictly with applicable stock exchange regulations and report our activities accurately in our financial statement.
Customers: Total provides customers with quality products and services, strives at all times to offer them the best performance at competitive prices for their particular requirements.
We are attentive to our customer’s needs, continuously monitoring, assessing and improving our products, services, technology and procedures to deliver quality, safety and innovation at every stage of the development, production and distribution process.
Total Petroleum Ghana Limited • 55 Annual Report & Financial Statement 12 for the year ended 31st December, 2014 Extract Of Code Of Conduct (Continued)
Employees: Total has confidence in the loyalty, motivation, competence and sense of responsibility of its employees.
We expect them to adhere to the highest standards of integrity and avoid any conflict of interest.
We pay particular attention to our employees’ working conditions, respecting individuals, avoiding discrimination and protecting their health and safety.
We include our employees in our development by encouraging the distribution of information, dialogue and consultation.
We respect their personal lives.
We recruit personnel solely on the basis of our requirements and the specific capabilities of individual applicants.
We develop their professional skills and careers without discrimination regarding race, gender, or affiliation with a political, religious, or union organization or minority group.
All employees have an individual performance appraisal with management once a year, at which objectives are set, performance assessed and career development discussed. Career development is facilitated by appropriate training.
Suppliers: Total is careful to respect each party’s interests, with transparent and fairly negotiated contract terms.
We expect our suppliers to adhere to principles equivalent to those in our code of conduct.
Business Partners Total applies its business Principles and Rules of Individual Behaviour whenever it leads or operates a joint venture.
When we do not lead or operate a venture, we require the leader or operator to apply principles that are compatible with our Business Principles and Rules of Individual Behaviour.
Host Countries In conducting its businesses, Total respects the natural environment and the cultural values of host countries.
However, we reserve the right to express to governments our position concerning our operations, employees and Shareholders and our belief in the importance of respecting human rights.
Through our operations, we contribute to the social and economic development in countries where we operate particularly local communities.
We comply with all applicable laws and regulations, especially concerning the environment, competition and employment.
Total rejects all forms of bribery and corruption. In particular, Total will not resort to bribery or corruption “in order to obtain or retain business or other improper advantage in the conduct of international business” as outlined in the OECD Convention on combating Bribery of Foreign Public Officials in International Business Transactions.
All our stakeholders are encouraged to inform or report any breach of company procedure or wrongdoing to the following whistle-blowing email address which is accessible only by the chairperson of the ethics committee: [email protected]
56 • Total Petroleum Ghana Limited
Annual Report & Financial Statement 13 for the year ended 31st December, 2014 Network And Commercial Development
Service Station Network Expansion The Year 2014 saw a lot of activity in the development of service stations across the country with 19 DODOS (in partnership with private developers) and 2 CODOS (company-owned) being developed. This has increased our presence nationwide from Wa in the Upper East Region, through Kaase in the Ashanti Region, right down to Sokode in the Volta Region.
Product Line Expanded with Launch of HI-Perf 4T Special Motorcycle Lubricant The year under review also saw the launch of a new motorcycle oil onto the Ghanaian market. Recognising the proliferation of motorcycles on our streets and the absence of a high-grade motorcycle oil in Ghana, the Hi-Perf 4T Special Motorcycle Lubricant was introduced to the market.
The launch took place simultaneously in the big towns and cities across the country including Tamale, Bolgatanga, Takoradi, Kumasi, Ho, Aflao and Accra.
The product has since recorded very high patronage.
58 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 13 Network And Commercial Development
Front Liners Recognised As part of our overall human resource development initiative, several training and reward schemes have been put in place to ensure excellent service delivery to our customers.
A Customer Attendants Week was organised to recognise the best performers throughout the preceding year.
Dealer Convention
A strategic conference was held for Dealers during the course of the year to deliberate on the previous year’s performance and discuss programmes for the year ahead. At a dinner dance and awards ceremony, high performers were awarded with various prizes including computers and various sums of cash. The awardees also included the field staff in the Marketing Department as well as customer attendants.
Total Petroleum Ghana Limited • 59 Annual Report & Financial Statement 14 for the year ended 31st December, 2014 Corporate Programmes
STAFF DEVELOPMENT INITIATIVE
Innovation Week Throughout the year, staff development programmes were initiated to stimulate creativity to help position TOTAL as a unique brand.
One such initiative was the celebration of the Innovation Week, where several activities were held to encourage staff to come up with different ways of doing business.
The programme formed part of the Total Group’s initiative at developing local talent.
Wellness Week Year 2014 has been an eventful year on the health front, particularly in Ghana. The whole world was rocked with the news about the break-out of the Ebola virus, particularly in Africa. Then came the cholera outbreak in Ghana to which a significant number of Ghanaians succumbed. World AIDS Day in December, 2014 was therefore marked differently with a series of activities to draw attention to the menace on the health front. These involved raising and sustaining awareness on various health issues including, Cholera, Ebola and HIV/AIDS. The week-long program was held in collaboration with health experts from the West Africa AIDS Foundation. Voluntary counselling and testing sessions climaxed presentations and video shows on the diseases whilst the experts engaged staff in discussions on the various health subjects. The programmes were interspersed with real-life experiences shared by persons living with HIV/AIDS. Approximately 300 staff and stakeholders ascertained their HIV status at the end of the program.
Safety We have committed a lot of resources towards ensuring the safety of our various stakeholders. Within the year under review, various safety interventions were held for staff and stakeholders. These included a series of durbars for staff and contractors to raise awareness about ensuring safe practices both within and outside the workplace.
60 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 14 Corporate Programmes
EDUCATION opportunity to attend the Total Summer School in Paris from June 22 to 27, 2014. Ewurabena has the Ghanaian Student Attends 2014 Total Summer opportunity to work with TPGL after completing her School education. The Total Summer School has been running for the past nine years. The 2014 programme brought TPGL at Career Fair at Ashesi University together 120 successful students from universities across the world. The Ashesi University has benefited from TPGL’s sponsorship for a second successive time following One Ghanaian student, Ewurabena Mansa Assam our participation in the 2013 career fair. from the Kwame Nkrumah University of Science & Technology (College Of Engineering) had the TPGL’s participation in the fair was to guide students through the many career development opportunities at TPGL and to showcase how positively the company could impact their career aspirations once the opportunity presented itself.
World Malaria Day Under the theme “Total Petroleum Ghana against Malaria” TPGL every year observes the World Malaria Day with series of activities to increase awareness about the prevention and control of Malaria. Over 2,000 pupils of the Kanda/Nima Cluster of schools participated in the campaign.
There was a lot of excitement as the pupils took part in quiz competitions and dramatized the causes and the ways of preventing Malaria. Each child also received treated mosquito nets and other educative materials from Total.
The Total team carried the campaign to some selected polyclinics including, Usher Fort, James Town and Mamprobi Polyclinics. All who patronized the ante- natal and post-natal clinic within the week received insecticide-treated nets and Total insecticide sprays.
Total Petroleum Ghana Limited • 61 Annual Report & Financial Statement 14 for the year ended 31st December, 2014 Corporate Programmes
Caravan for Safety Total Caravan is five years!
Over the years the caravan has made significant interventions which have provided platforms for residents to share real life experiences whilst learning from messages and various demonstrations from road safety experts. In the year 2014, the campaign reached several towns located along the Yamoransa-Komenda and the Kintampo-Buipe highways.
Total Safety Cube Our continued intervention in the area of road safety has resulted in a collaboration with various external agencies to extend our campaigns to several schools and communities across the country.
Selected schools were visited in the Central, Greater Accra and Volta Regions throughout the year to educate children and residents on road safety through various animations. The most prominent medium for communicating was the Total Safety Cube, which is a kit containing various educational materials such as route mappings fitted with road signs and structures. The kits serves as a guide to teach children the basic behavioural skills to employ in road usage.
62 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 15 Recognition
Chartered Institute of Marketing Ghana (CIMG) We retained the title as the only Petroleum Company in the CIMG Hall of Fame for the second time running.
A cross section of staff and Dealers represented us at an awards ceremony during which we were presented with a citation and a plaque in recognition of our efforts at innovation, CSR initiatives, staff development, and new business development, amongst others.
Also in the Ashanti and Western Regions of Ghana At two separate ceremonies in Kumasi and Takoradi during the Ashanti and Western Business Excellence Awards, we were recognised for our business exploits and immense contributions within and out of both regions.
Total Petroleum Ghana Limited • 63
Notes Annual Report & Financial Statement 16 for the year ended 31st December, 2014 PROXY FORM
PROXY FORM FOR USE AT THE ANNUAL GENERAL MEETING TO BE HELD AT THE NATIONAL THEATRE, LIBERIA ROAD, ACCRA ON WEDNESDAY, 3RD DAY OF JUNE, 2015 AT 11.00 O’CLOCK IN THE FORENOON
I/We,______being Member(s) of TOTAL PETROLEUM GHANA LIMITED, hereby appoint or failing him/her the Chairman as my / our Proxy to vote for me / us, and on my / our behalf at the Annual General Meeting of the Company to be held on the Wednesday, 3rd June, 2015 and at any and every adjournment thereof.
This Form to be used :-
Ordinary Resolutions
1. *in favour of The Resolution to adopt the Reports of the Directors, Auditors and the Financial against Statements of the Company for the year ended 31st December, 2014.
2. *in favour of The Resolution to declare final dividend for the year ended 31st December, 2014 as against recommended by the Directors. 3. *in favour of The Resolution to ratify the appointment of Mr. Olivier Van Parys as a Director of the against Company. 4. *in favour of The Resolution to ratify the appointment of Mr. Martin Amenyedzi as a Director of the against Company.
5. *in favour of against The Resolution to re-elect Mr. Thibault de Langlais as a Chairman of the Company.
6. *in favour of against The Resolution to re-elect Mr. Gerard Pruneau as a Director of the Company.
7. *in favour of The Resolution to re-elect Mr. Edward Patrick Larbi Gyampoh as a Director of the against Company.
8. *in favour of The Resolution to fix the remuneration of the Directors. against 9. *in favour of against The Resolution to authorise the Directors to fix the remuneration of the Auditors.
Special Business
10. *in favour of The Special Resolution approving amendment to the Regulations of the Company. against g) To engage in the production and distribution of Solar Energy and other forms of renewable energy. On any other business transacted at the Meeting and unless otherwise instructed in paragraphs 1 to 10 above, the resolutions to which reference is made in paragraphs, the Proxy shall vote as he/she thinks fit.
*Strike out whichever is not desired.
Signed this ...... day of ...... 2015 ...... Signature of Shareholder
66 • Total Petroleum Ghana Limited Annual Report & Financial Statement for the year ended 31st December, 2014 16 PROXY FORM (CONTINUED)
THIS PROXY FORM SHOULD NOT BE COMPLETED AND SENT TO THE REGISTERED OFFICE IF THE MEMBER WILL BE ATTENDING THE MEETING
1. A member (Shareholder) who is unable to attend an Annual General Meeting is allowed by law to vote by proxy. The Proxy Form has been prepared to enable you exercise your vote if you cannot personally attend.
2. Provision has been made on the Form for MR. THIBAULT DE LANGLAIS, the Chairman of the meeting to act as your Proxy, but if you so wish, you may insert in the blank space provided the name of any person, whether a member of the Company or not, who will attend the meeting and vote on your behalf instead of MR. THIBAULT DE LANGLAIS.
3. In case of joint holders, each joint holder must sign.
4. If executed by a Corporation, the Proxy Forms must bear its Common Seal or be signed on its behalf by a Director.
5. Please sign the above Proxy Form and post it so as to reach the address shown overleaf not later than 4.00 p.m. on Monday the 1st of June, 2015.
6. The Proxy must produce the Admission Card with the Notice of the Meeting to obtain entrance to the meeting.
Total Petroleum Ghana Limited • 67 SECOND FOLD HERE ......
Please affix stamp
The Secretary TOTAL PETROLEUM GHANA LIMITED 25 Liberia Road P.O. Box 553, Accra, Ghana
FIRST FOLD HERE FOLD FIRST ...... HERE FOLD THIRD ...... Notes
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