Notes to the Group financial statements

for the year ended 30 June

  R million   2014   2013   2012  
21.   BORROWINGS        
  Non current        
  Term facilities   2 279   1 113   1 136  
  V&A loan   319   329   334  
  Redeemable preference shares   1 106   2 243   2 925  
  Lease liabilities   30   17   55  
  Vacation Club members   38   51   46  
    3 772   3 753   4 496  
  Current        
  Short-term banking facilities   2 488   2 549   1 892  
  Term facilities   45   213   101  
  Redeemable preference shares   876   12   5  
  Lease liabilities   29   63   47  
  V&A loan   10   5   –  
  Minority shareholder loans   362   324   377  
    3 810   3 166   2 422  
  Total borrowings   7 582   6 919   6 918  
  Secured   442   483   528  
  Unsecured   7 140   6 436   6 390  
    7 582   6 919   6 918  
  The fair value of borrowings approximate their carrying values except for the V&A loan which has a fair value of R368 million (2013: R387 million). The fair value has been determined on a discounted cash flow basis using a discount rate of 9% (2013: 9%).  
The carrying amounts of the borrowings are denominated in the following currencies:  
  R million   2014   2013   2012  
  US Dollar   210   727   764  
  Chilean Peso   383   95   120  
  South African Rand   6 989   6 097   6 034  
    7 582   6 919   6 918  
  Included in the South African Rand amount is a loan from Nedbank of R507 million. This loan was taken out to fund the purchase and fitout of the Ocean Sun Casino in Panama. The Company has entered into an interest rate cross currency swap to fix the interest rate and convert payments into dollars.  
Lease liabilities are effectively secured as the rights to the leased asset revert to the lessor in event of default.  
  R million   2014   2013   2012  
  Net book value of property, plant and equipment encumbered by secured loans   2 348   2 442   3 436  
  The borrowings are repayable as follows:        
  6 months or less   876   300   450  
  6 months – 1 year   2 934   2 858   1 972  
  1 – 2 years   333   1 400   771  
  2 – 3 years   1 392   633   1 132  
  3 – 4 years   1 036   1 197   1 309  
  4 years and onwards   1 011   531   1 284  
    7 582   6 919   6 918  
  Interest rates        
  Year end interest and dividend rates are as follows:        
  Short-term banking facilities   7.3%   6.6%   7.1%  
  Term facilities   6.0%   7.6%   7.7%  
  V&A loan   12.2%   12.2%   12.2%  
  Redeemable preference shares   7.5%   6.9%   7.0%  
  Lease liabilities   9.0%   9.1%   9.3%  
  Vacation Club members   10.9%   10.9%   10.9%  
  Minority Shareholders’ loans   5.0%   5.0%   6.1%  
  Weighted average   7.2%   7.2%   7.4%  
  As at 30 June 2014, interest rates on 23% (2013: 27%) of the Group’s borrowings were fixed. 69% (2013: 78%) of these fixed borrowings were for periods longer than 12 months. The interest rates other than on the V&A loan, approximate those currently available to the Group in the market.  
  R million   2014   2013   2012  
  Redeemable preference shares        
  SIL   –   417   1 111  
  SISA   1 350   1 350   1 350  
  RAH   121   –   –  
  Dinokana   511   488   469  
    1 982   2 255   2 930  
  Preference dividends on the SIL preference shares were payable semi-annually on 31 March and 30 September and calculated at a rate of 77% (2013: 77%) of the bank prime overdraft rate. The preference shares were redeemed during the current financial year.  

Preference dividends on the SISA preference shares are payable semi-annually on 31 August and 28 February and are calculated at an average rate of 7.1% (2013: 6.8%). The SISA preference shares are redeemable as follows:  
        R million  
  October 2014       365  
  December 2016       675  
  October 2017       240  
  December 2017       70  
        1 350  
 
Preference dividends on the RAH preference shares are payable semi-annually on 31 May and 30 November and are calculated at a rate of 71% of the bank prime overdraft rate. The preference shares are redeemable in December 2016.  

Preference dividends on the Dinokana preference shares are payable semi-annually on 31 March and 30 September and are calculated at a rate of 91.3% (2013: 91.3%) of the bank prime overdraft rate. The preference shares are redeemable on 3 December 2014.  
A register of non current borrowings is available for inspection at the registered office of the Company.  

The Group had unutilised borrowing facilities of R1.7 billion (2013: R527 million) at 30 June 2014. All undrawn borrowing facilities are renewable annually and none have fixed interest rates.  

Capitalised lease liabilities  
Finance lease liabilities are primarily for slot machines. At the time of entering into the capital lease arrangements, the commitments are recorded at the present value using applicable interest rates. The aggregate amounts of minimum lease payments and the related imputed interest under the capitalised lease contracts payable in each of the next five financial years and thereafter are as follows:  
  R million   2014   2013   2012  
  Gross minimum lease payments:        
  No later than 1 year   30   63   47  
  Later than 1 year and no later than 5 years   31   22   57  
    61   85   104  
  Imputed interest:        
  No later than 1 year   (1)  –   –  
  Later than 1 year and no later than 5 years   (1)  (5)  (2) 
    (2)  (5)  (2) 
  Net capital payments of finance lease liabilities   59   80   102  
  Net carrying value of assets held under finance leases   99   107   116