GOING CONCERN

The consolidated financial statements are prepared on the going concern basis. Based on the cash flow forecasts, available cash resources and the other measures the group has taken or plans to take, management believes that the group has sufficient resources to continue operations as a going concern in a responsible and sustainable manner.

As at 31 March 2020, the group has net cash and cash equivalents of R722 million (2019: R212 million). The group has R4.0 billion (2019: R3.2 billion) of interest-bearing debt (excluding capitalised lease liabilities) and access to sufficient undrawn short-term facilities to meet its obligations as they become due.

In preparing the cash flow forecasts utilised to assess going concern, the impact of the COVID-19 pandemic on the group’s operations and liquidity was considered. The board of directors of the company has assessed the cash flow forecasts together with the other actions taken or proposed by management and is of the view that the group has sufficient liquidity to meet its obligations and to counteract the expected losses that may result from the COVID-19 impact on the group’s operations in the next financial year.

The recoverable amount for property, plant and equipment has been determined by calculating the value in use using a discounted cash flow model. The impact of COVID-19 on the cash flow forecasts reduced the value in use and the property, plant and equipment was impaired by R716 million. Refer to note 16 of the financial statements. Equally, the cash flow forecasts impacted the fair value of the investment properties negatively and consequently a fair value adjustment of R888 million was recognised. Refer to note 18 of the financial statements.