Notes to the pro forma statement of comprehensive income of the Bidcorp Group for the year ended June 30 2016 | ANNEXURE B | Bidcorp

Notes to the pro forma statement of comprehensive income of the Bidcorp Group

for the year ended June 30 2016

Annexure B – pro forma information

Column 1 presents the actual financial information relating to the Bidcorp Group, which has been extracted from the audited financial information of the Bidcorp Group for the year ended June 30 2016.
Column 2 presents the unadjusted financial information relating to the excluded assets that did not form part of the Bidcorp Group from April 1 2016. The excluded assets were transferred out of the Bidcorp Group as part of the internal restructuring.
Column 3 presents financial effect on the weighted average number of shares (basic and diluted) of the issue of 335,4 million new Bidcorp shares had the unbundling taken effect on July 1 2015, as settlement for the disposal consideration in respect of the transferring assets. These adjustments will have a continuing effect on the Bidcorp Group's pro forma statement of comprehensive income.
Column 4 presents the financial information relating to Bidvest Food Africa from July 1 2015 to March 31 2016, which has been extracted from the financial information of Bidvest Food Africa for the period ended March 31 2016. Bidvest Food Africa forms part of the transferred assets that were transferred to the Bidcorp Group as part of the internal restructuring and as such, the income and expenditure relating to Bidvest Food Africa needs to be included in the consolidated pro forma financial information of the Bidcorp Group. The unadjusted income and expenditure relating to Bidvest Food Africa has been reviewed by KPMG Inc. and their unqualified review opinion is available for inspection. These adjustments will have a continuing effect on the Bidcorp Group's pro forma statement of comprehensive income.
Column 5 presents the unadjusted financial information relating to Bidvest Food Properties, which has been extracted from the financial statements Bidvest Food Properties for the period ended March 31 2016. Bidvest Food Properties forms part of the transferred assets and were transferred to the Bidcorp Group as part of the internal restructuring. The properties housed in Bidvest Food Properties are all owner occupied in terms of inter-company triple net leases. All expenditure relating to such properties, therefore, have historically, and will continue to eliminate on consolidation.
Column 5 also includes the financial information relating to Bidcorp Corporate Services:
- Costs of R39,2 million which relate to the executives who were employed by Bidvest but who are now employed by the Bidcorp Group subsequent to the listing and unbundling and other costs ("head office costs"). These adjustments will have a continuing effect on the Bidcorp Group's pro forma statement of comprehensive income;
- Inclusion of the historical administrative fee income of R29,6 million incurred by subsidiaries of Bidcorp which represents a recovery of the head office costs. These adjustments will have a continuing effect on the Bidcorp Group's pro forma statement of comprehensive income;
- Share-based payment (IFRS 2) charge of R7,9 million, and the related taxation adjustment, which relates to the executives who were employed by Bidvest but are now employed by the Bidcorp Group subsequent to the listing and the unbundling. These adjustments will have a continuing effect on the Bidcorp Group's pro forma statement of comprehensive income.
Column 6 read together with Column 7 illustrate that the financial effects of the transfer of the Bidvest treasury shares to Bidcorp and does not have an impact on the Bidcorp Group's pro forma statement of comprehensive income, other than the dilutionary effect of the increased number of issued shares. The effect of any dividends have not been taken into account as it is not considered to be material.
Column 7 illustrates the elimination of the revenue and the related taxation from the included properties on consolidation and the financial effects of additional group interest due to the settlement of Bidvest inter-group loans. An expected interest charge of R12,2 million was calculated using an interest rate of 2,0%.
Column 8 presents the pro forma statement of comprehensive income of the Bidcorp Group subsequent to the internal restructuring and including the adjustments detailed in columns 2 to 7, to reflect the Bidcorp Group as if the internal restructuring occurred on July 1 2015.