12. EQUITY, DISTRIBUTIONS AND GROUP INFORMATION
12.1 Capital and reserves attributable to shareholders of the company
 

Stated capital

  2019 
R’000 		     2018 
R’000 		  
Issued stated capital 5 428 016      5 428 016   
   Treasury shares held by subsidiary (435 584)     (601 908)  
   Balance at beginning of year (601 908)     (795 187)  
   Shares purchased during year (6 306)     –   
   Shares disposed of in terms of share incentive plans 172 630      193 279   
Reserves          
   Foreign currency translation reserve 5 263 176      5 497 156   
   Hedging reserve (1 056)     (450)  
   Equity-settled share-based payment reserve 341 798      325 383   
   Retained earnings 17 902 350      15 896 255   
Total capital reserves comprise          
   Amounts attributable to shareholders of the company 28 498 700      26 544 452   
   Amounts attributable to non-controlling interests 237 267      244 452   
  28 735 967      26 788 904   

Stated capital

No par value ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new no par value ordinary shares are deducted against the stated capital account.

Treasury shares

Shares in the company, held by its subsidiary, are classified as the group’s shareholders’ interest as treasury shares. These shares are treated as a deduction from the issued and weighted average number of shares. The cost price of the treasury shares is presented as a deduction from total equity. When treasury shares are purchased the cost is debited to this separate category of equity. When treasury shares are sold the amount received for the instruments is credited to this separate category of equity.

Foreign currency translation reserve

The translation reserve comprises foreign exchange differences arising from the translation of the financial statements of foreign operations.

Equity-settled share-based payment reserve

The equity-settled share-based payment reserve (SBP reserve) includes the fair value of the share appreciation right awards granted and conditional share awards made to executive directors and staff, which have been recognised over the vesting period at fair value with a corresponding expense recognised in the statement of profit or loss. The total share-based payment expense for the group during the year was R116,9 million (2018: R102,3 million). Our settlement practice of the share-based payment incentive plans has been through a subsidiary company (other than the employer company of the participant), which holds Bidcorp treasury shares (Bid Treasury Company). In terms of an inter-group repayment arrangement, the employer company pays the purchase contribution to the Bid Treasury Company for the market value of the shares that were awarded to the participant exercising the award. The R172,6 million (2018: R193,3 million) utilisation during the year represents the market value of Bidcorp shares received by participants for share awards that were exercised. The credit entry for the R172,6 million (2018: R193,3 million) is recorded under treasury shares representing the Bidcorp shares that were sold to satisfy the participant share awards that were exercised. The transfer to retained earnings of R65,0 million (2018: R395,3 million) merely represents a transfer between equity reserves for settled share awards.

  2019 
Number 
of shares 
(’000)		     2019 
Number 
of shares 
(’000)		  
Stated capital          
Authorised          
540 000 000 ordinary shares of no par value (2018: 540 000 000 ordinary shares of no par value)          
Issued          
335 404 212 ordinary shares of no par value (2018: 335 404 212 ordinary shares of no par value) 335 404      335 404   
Less: Treasury shares held by Bidcorp Treasury Company (1 721)     (2 291)  
   Balance at beginning of year (2 291)     (2 968)  
   Shares disposed in terms of share incentive plans 593      677   
   Shares purchased during year (23)     0   
  333 683      333 113   

16 750 000 unissued no par value ordinary shares are under the control of the directors until the next annual general meeting.
     2019 
R’000 		     2018 
R’000 		   
12.2  Dividends paid              
   2018 final dividend paid of 280,0 cents per share (2017: final dividend paid: 250,0 cents per share) (838 511)     (838 511)   
   2019 interim dividend paid of 310,0 cents per share (2018: interim dividend paid: 280,0 cents per share) (1 039 753)     (939 132)   
   Amounts paid per the consolidated statement of cash flows (1 978 885)     (1 777 643)   
12.3 Group composition
 

A list of the group’s significant subsidiaries, their country of incorporation and principal place of business, the group’s percentage shareholding and an indication of their nature of business is included below:

      Effective holdings %
  Principal place
of business		 Nature of
business		 2019 2018  
Subsidiaries          
Bidfood Efe Daǧitim ve Pazarlama A.Ș. Turkey 1 65 65  
Bidfood Holdings AS Turkey 1 85 85  
Al Diyafa Company for Catering Services LLC Saudi Arabia 1 53 53  
Angliss Beijing Food Service Limited China 1 70 70  
Angliss Guangzhou Food Service Co Limited China 1 90 90  
Angliss Hong Kong Foodservice Limited Hong Kong 1 100 100  
Angliss International Investment Limited Hong Kong 1 100 100  
Angliss Macau Food Service Limited Macau 1 100 100  
Angliss Shanghai Food Service Limited China 1 100 97  
Angliss Shenzen Food Service Limited China 1 100 99  
Angliss Singapore Pte Limited Singapore 1 100 100  
Applied Logic Systems Limited New Zealand 1 100 100  
Bidfood Bestfood NV Belgium 1 100 100  
BFS Botany Proprietary Limited Australia 1 100 100  
BFS Byron Bay Limited Australia 1 100 100  
BFS Group Limited (trading as 3663) England 1 100 100  
BFS Port Macquarie Proprietary Limited Australia 1 100 100  
Bidcorp (UK) Limited England 1 100 100  
Bidcorp Finance Limited Isle of Man 1 100 100  
Bidcorp Food Africa Proprietary Limited South Africa 1 100 100  
Bidcorp Food Property Proprietary Limited South Africa 1 100 100  
Bidcorp Foodservice International Limited Isle of Man 2 100 100  
Bidcorp Foodservice (Europe) Limited England 1 100 100  
Bidcorp International Limited Isle of Man 2 100 100  
Bidcorp Properties International Limited Isle of Man 2 100 100  
Bidfood (NSW) Proprietary Limited Australia 1 100 100  
Bidfood (Victoria) Proprietary Limited Australia 1 100 100  
Bidfood (WA) Proprietary Limited Australia 1 100 100  
Bidfood Australia Limited Australia 1 100 100  
Bidfood Belgium NV Belgium 1 100 100  
Bidfood Czech Republic s.r.o. Czech Republic 1 94 94  
Bidfood Chile S.A. Chile 1 90 90  
Bidfood China Limited China 1 100 100  
Bidfood Deli XL. B.V Netherlands 1 100 100  
Bidfood De Clercq NV Belgium 1 100 100  
Bidfood Langens NV Belgium 1 100 100  
Bidfood Spain S.L. Spain 1 90 90  
Bidfood Limited Botswana 1 100 100  
Bidfood Limited New Zealand 1 100 100  
Bidfood Proprietary Limited South Africa 1 100 100  
Bidfood SA Belgium 1 100 100  
Bidfood Malaysia Sdn. Bhd. Malaysia* 1 85 85  
Bidfood SA Chile 1 90 90  
Bidfresh Limited England 1 100 100  
Bidfresh Proprietary Limited South Africa* 1 70 70  
BTW Investments Proprietary Limited South Africa 2 100 100  
Burleigh Marr Distributions Proprietary Limited Australia 1 100 100  
Campbell Brothers Limited England 1 100 100  
Cárnicas Sáez, S.L. Spain* 1 68 68  
Cater Plus Proprietary Limited Australia 1 100 100  
Caterfood Holdings Limited England 1 100 88  
Cimandis Limited Jersey 1 100 100  
Clayton Cold Store Proprietary Limited Australia 1 100 100  
Cold Seas Proprietary Limited Australia 1 100 100  
Crown Food Group Proprietary Ltd South Africa 1 100 100  
D&D S.p.A. Italy* 1 60 42  
Distribuidora E Importadora Irmaos Avelino Ltda Brazil* 1 60 60  
Distrubuzione Alimentari Convivenze SPA Italy* 1 60 60  
Farutex Sp. z.o.o. Poland 1 91 91  
Food & Wine Sp.z.o.o Poland 1 91 91  
Foodreporter B.V. Netherlands 1 100 100  
Frustock – Foodservice, S.A. Portugal* 1 72 72  
Goldline Distributors Proprietary Limited Australia 1 100 100  
Guzman Gastromania S.L. Spain* 1 90 90  
Him Kee Food Distribution Co. Limited Hong Kong 1 100 100  
Horeca Trade LLC United Arab Emirates 1 70 70  
Igartza, S.L Spain* 1 90 –  
Jilin Bidcorp Food Service Limited China 1 60 60  
John Lewis Foodservice Proprietary Limited Australia 1 100 100  
KBC Foods Australia 1 100 –  
Linson Global Seafood Trading Limited Hong Kong 1 70 70  
Mariusso Comércio De Alimentos E Representação Ltda Brazil* 1 48 48  
Pastry Global Foodservice Limited Hong Kong 1 100 100  
PCL Transport 24/7 Limited England 1 100 100  
Pier 7 Holding GmbH Germany 1 70 70  
The Punjab Kitchen Limited England 1 90 –  
Quartiglia Food Service S.p.A Italy* 1 36 36  
R Noone & Son Limited England 1 100 80  
Six Bar Trading 409 CC South Africa 1 100 –  
Tekoo SPOL s.r.o Czech Republic 1 100 100  
UAB Bidfood Lietuva Lithuania 1 100 100  
United Imports & Exports Co. Proprietary Limited Australia 1 100 100  
Van de Mheen Foodservices B.V. Netherlands 1 100 100  
* The group has put option arrangements for these entities or its holding company. In terms of the anticipated acquisition method, these entities are consolidated as 100% held subsidiaries. (Refer note 10.4 for details).
      Effective holdings %
  Principal place
of business		 Nature of
business		 2019 2018  
Associates          
ATL Seafood Ijmuiden BV Netherlands 1 30 30  
ATL Vastgoed BV Netherlands 1 30 –  
COAR S.p.A Italy 1 50 50  
Griffith Crown Foods Proprietary Limited South Africa 1 49 49  
Farm Fresh Holding BV Netherlands 1 25 25  
Maxxam BV Netherlands 1 17 17  
Maxxam CV Netherlands 1 17 17  
Van Gelder Ridderkerk BV Netherlands 1 20 20  
Jointly-controlled entities          
Chipkins Puratos Proprietary Limited South Africa 1 50 50  
Distribuidora Blancaluna S.A Argentina 1 38 –  
Nature of business
1. Catering supplies, food and allied products
2. Group services, investments and property holding
12.4 Related parties
 

Identification of related parties

The group has a related-party relationship with its subsidiaries and associates. Key management personnel has been defined as the executive and non-executive directors of the company. The definition of key management includes the close members of family of key management personnel and any other entity over which key management exercises control. Close members of family are those family members who may be expected to influence, or be influenced by, that individual in their dealings with the group. They may include the individual’s domestic partner and children, the children of the individual’s domestic partner, and dependants of the individual or the individual’s domestic partner.The group has a related-party relationship with its subsidiaries and associates. Key management personnel has been defined as the executive and non-executive directors of the company. The definition of key management includes the close members of family of key management personnel and any other entity over which key management exercises control. Close members of family are those family members who may be expected to influence, or be influenced by, that individual in their dealings with the group. They may include the individual’s domestic partner and children, the children of the individual’s domestic partner, and dependants of the individual or the individual’s domestic partner.

Transactions with key management personnel

Directors’ remuneration in total, paid by a subsidiary, is included in note 4.2. Details pertaining to executive and non-executive directors’ compensation are set out in note 11.2.

The group encourages its employees to purchase food products from group companies. These transactions are generally conducted on terms similar to those with third parties, although in some cases nominal discounts are granted. Transactions with key management personnel are conducted on similar terms. No abnormal or non-commercial credit terms are allowed, and no impairments were recognised in relation to any transactions with key management personnel during the year, nor have they resulted in any non-performing debts at the year-end.

Similar policies are applied to key management personnel at subsidiary level who are not defined as key management personnel at the group level.

Transactions with related parties

  2019
R’000		   2018
R’000		  
Outstanding advances due at year-end by associates (note 9.1) 31 884   100 758  
Total value of revenue received from associates 52 976   33 440  
Amounts due by associates included in trade receivables 23 055   6 145  
Total value of inventory purchased from associates 1 006 262   1 238 949  
Total value of services purchased from associates 109 606   15 995  
Amounts due to associates included in trade payables 117 822   108 975  
Total value of revenue received from jointly-controlled entity 45 214   20 831  
Property rental income from jointly-controlled entity 14 141   11 759  

Details of effective interest, investments and loans to associates are disclosed in note 9.1
12.5 Commitments and capital management
 
The board of directors’ policy is to maintain a strong capital base so as to sustain future development of the businesses so that it can continue to provide benefits to its shareholders.        
Capital expenditure approved:        
    Contracted for 1 113 122   831 471  
    Not contracted for 1 188 901   1 015 846  
  2 302 023   1 847 317  
Capital expenditure split        
    Property, plant and equipment 2 171 767   1 794 724  
    Computer software 130 256   52 593  
  2 302 023   1 847 317  

It is anticipated that capital expenditure will be financed out of existing cash resources.
12.6 Contingent liabilities
 

The group has outstanding legal and other claims arising out of its normal ongoing operating activities which have to be resolved. None of these claims are significant.
12.7 Subsequent events
 

The group is currently in negotiations for the sale of the UK Contract Distribution business in the United Kingdom. The process is at an advanced stage and management is optimistic of a successful conclusion to these negotiations. Other than the matter above, there are no material events subsequent to June 30 2019.
12.8 Going concern
 

The directors have made an assessment of the group’s ability to continue as a going concern and there is no reason to believe that the group will not be a going concern in the year ahead.