242 / 280
NOTES TO THE COMPANY ANNUAL FINANCIAL STATEMENTS
CONTINUED
For the year ended 31 May 2014
240
BLUE LABEL INTEGRATED ANNUAL REPORT 2014
6.
INVESTMENTS IN GROUP COMPANIES AND RELATED LOANS (continued)
6.1 Investments in and loans to subsidiaries (continued)
In the prior year, TicketPros Proprietary Limited, Blue Label Engage Proprietary Limited, Panacea Mobile
Proprietary Limited and Africa Prepaid Services Nigeria Limited were acquired. In the current year shares in
Simigenix Proprietary Limited were acquired, as well as additional shares in Panacea Proprietary Limited,
TicketPros Proprietary Limited and Africa Prepaid Services Proprietary Limited. Refer to note 26 in the Group
notes for details of these acquisitions.
2014
R’000
2013
R’000
6.2 Investments in and loans to joint ventures
Shares as at the beginning of the year
164 826
26 652
Acquisition of joint venture
89 316
138 174
Shares as at the end of the year
254 142
164 826
Loans at the beginning of the year
—
27 829
Loan granted to joint venture capitalised
(89 316)
(112 822)
Loans granted to joint venture
86 819
84 993
Unrealised foreign exchange profit on loans to joint ventures
3 551
—
Loans at the end of the year
1 054
—
Closing net book value
255 196
164 826
On 10 September 2013 a loan of R85.8 million was advanced to Blue Label Mexico S.A. de C.V. (BLM).
This loan was capitalised on 18 December 2013. The difference of R3.5 million relates to foreign exchange
movements.
There was no impairment of investment in joint ventures. The terminal growth rates applied was 3.5% (2013:
4.3%). The weighted average cost of capital used to discount these cash flows was 17.44% (2013: 17.8%).
The discount rates used are pre-tax and reflect specific risks relating to the relevant companies.
The discount rate used when calculating the value-in-use calculations would need to be increased by
3% before any impairments would need to be recognised.