SBN HOLDINGS LIMITED Annual Report 2022
120
39.
NOTES TO THE ANNUAL FINANCIAL STATEMENTS continued
Headline earnings
GROUP
2022
2021
Non-
Non-
controlling
Gross
N$'000
Tax
N$'000
interest
Net
N$'000 N$'000
Gross
N$'000
Tax
N$'000
controlling
interest
N$'000
Net
N$'000
Profit for the year
Headline earnings
adjustments:
858 863
(234 583)
(1 651)
528
(677) 623 603
(1123)
519 207
(152 996)
(823) 365 388
1 313
(420)
893
IAS 16 (Profit)/loss
on sale of property
and equipment
IAS 28 Loss on
derecognition of
equity accounted
joint venture
IAS 36
Impairments
on property and
equipment
(3426)
1 096
(2 330)
(703)
225
SBN HOLDINGS LIMITED
Annual report 2022
121
(478)
42.
Acquisition of subsidiaries
Acquisition of Spearmint
The group acquired 100% shareholding in Spearmint, a property holding company that owns 100% of the total issued share
capital of the property investment entities listed in Annexure A. This acquisition was as a result of a debt settlement transaction
and represents the recovery of the corresponding credit impaired loans and advances provided to the counterparty. The
effective date of the transaction is 3 August 2022.
Management has performed an assessment to determine whether this was a business combination in terms of IFRS 3 or an
asset acquisition. Management has elected to apply the optional asset concentration test described in IFRS 3. In applying
the asset concentration test, an entity determines whether all of the fair value of the gross assets acquired is concentrated
in a single asset or group of similar assets. If so, the set is not considered a business. Based on the assessment performed,
substantially all of the fair value of the gross assets acquired by the group is concentrated in a single asset or group of similar
assets (investment properties), the asset concentration test in terms of paragraph B7B of IFRS 3 has been met and as a result,
the group has accounted for the acquisition as that of a group of assets. Since the group controls Spearmint, the group has
consolidated Spearmint.
The fair value of the shares at initial recognition in the property companies in Standard Bank's stand-alone financial
statements was determined in line with the requirements of IFRS 13 Fair Value. Management expert valuators were used by the
group to provide guidance on the measurement of the fair value of the shares in Spearmint. The investment in Spearmint is
subsequently measured at cost, in line with the current accounting policy. The cost at acquisition date represents the fair value
of the underlying property companies.
ECL was raised on the loans receivable from the counterparty to the extent that loans receivable exceeded the fair value loans
of the collateral, as determined by management expert valuators. The loans receivable and ECL were then derecognised and
the investments in Spearmint's shares recognised at this value at a subsidiary level.
In the consolidated financial statements, the assets of the property investment entities are accounted for as properties in
possession, being the fair value of the properties acquired as set out above. The properties in possession is subsequently
measured in line with the current accounting policy, as set out in Annexure D.
1 775
Headline earnings
857 212
(568)
(234 055)
1 207
2016
(677) 622 480
520 520
(645)
(153 416)
1 371
(823) 366 281
40.
Dividends
Ordinary dividends
GROUP
COMPANY
2022
N$'000
2021
N$'000
2022
N$'000
2021
N$'000
GROUP
2022
N$'000
Final dividend declared
78 371
73 146
78 371
73 146
Interim dividend declared
104 530
83 596
104 530
83 596
Purchase consideration:
Settlement of loans and advances
438 175
Total dividends recognised in the statement of
changes in equity
Total non-cash consideration
438 175
182 901
156 742
182 901
156 742
A final dividend of 46 cents per ordinary share was declared on 22 March 2023, payable on 26 May 2023 to all shareholders
registered on 12 May 2023, bringing the total dividends declared in respect of 2022 profits earned to 66 cents per share (2021:
31 cents per share).
The assets and liabilities recognised as a result of the acquisition are as follows:
Properties in possession
464 577
Other assets
Deferred tax liability
41.
Events after the reporting period
No subsequent events occurred between the year end and the date of signing of the financial statements.
Other liabilities
Net assets acquired
All assets and liabilities were considered to be fairly valued at acquisition date.
227
(26 025)
(604)
438 175
Further information on the
subsidiaries are disclosed in
Annexure A.
The acquisition of Spearmint caused a significant increase in the group's properties in possession value, as indicated in the
table below:
Properties in possession balance at the beginning of the year
Properties in possession acquired as part of the Spearmint transaction
Other movements during the year
Properties in possession balance at the end of the year
GROUP
2022
N$'000
24 892
464 577
1 685
491 154View entire presentation