Nampak Zimbabwe : FY22 Results & Audit Opinion

January 30, 2023 at 02:04 am EST

AUDITED ABRIDGED CONSOLIDATED RESULTS

FOR THE YEAR ENDED 30 SEPTEMBER 2022

AUDITED ABRIDGED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME OR LOSS FOR THE YEAR ENDED 30 SEPTEMBER 2022

			INFLATION ADJUSTED	HISTORICAL *

			2022	2021	2022	2021
			ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
CONTINUING OPERATIONS
Revenue	52 521 774	36 686 446	30 547 901	8 114 180
Raw materials and consumables used	(27 867 984)	(20 388 741)	(13 834 457)	(4 158 932)
Selling and distribution expenses	( 392 171)	( 169 133)	( 222 452)	( 37 671)
Depreciation and amortisation expenses	(1 073 778)	( 961 326)	( 94 170)	( 24 552)
Employee expenses	(6 386 071)	(3 844 382)	(3 711 157)	( 863 283)
Other operating expenses	(6 760 115)	(4 680 419)	(3 875 369)	(1 026 334)
Other operating income	299 756	135 104	218 404	28 121
Trading income	10 341 411	6 777 549	9 028 700	2 031 529
Other material income	2 483 566	288 804	2 190 677	69 286
Net monetary (loss) on hyperination	(4 107 052)	(1 323 662)	-	-
Operating prot	8 717 925	5 742 691	11 219 377	2 100 815
Finance income	49 936	17 939	24 545	4 058
Finance costs	( 18 442)	-	( 10 561)	-
Prot before tax	8 749 419	5 760 630	11 233 361	2 104 873

Tax expense	(6 133 971)	(3 127 697)	(2 914 073)	( 536 849)
Prot for the year from continuing operations	2 615 448	2 632 933	8 319 288	1 568 024
DISCONTINUED OPERATIONS
Share of net (loss) / prot from joint venture	-	( 10 633)	-	550
Prot for the year	2 615 448	2 622 300	8 319 288	1 568 574

Weighted average number of shares in issue	755 648 101	755 648 101	755 648 101	755 648 101
Earnings per ordinary share (cents)	346.12	347.03	1 100.95	207.58

AUDITED ABRIDGED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2022

			INFLATION ADJUSTED	HISTORICAL *

			2022	2021	2022	2021
			ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
ASSETS

Non-current assets
Property, plant and equipment	8 738 847	8 114 782	1 255 889	323 000
Right of use assets	122 183	183 399	33 345	48 212
Intangible assets	484 647	485 123	2 443	2 445
Biological assets	57 883	103 153	57 883	27 117
Investments	1 991	938	410	247
Deferred tax asset	-	-	516 275	73 450
Total non current assets	9 405 551	8 887 395	1 866 245	474 471
Current assets
Inventories	5 900 230	3 623 689	4 750 805	828 095
Trade and other receivables	11 051 353	7 281 110	10 414 873	1 866 738
Cash and cash equivalents	1 521 425	1 751 615	1 521 425	460 464
Total current assets	18 473 008	12 656 414	16 687 103	3 155 297

Total assets	27 878 559	21 543 809	18 553 348	3 629 768
EQUITY AND LIABILITIES
Capital and reserves
Share capital	149 966	149 966	756	756
Share premium	4 773 757	4 773 757	24 054	24 054
Non distributable reserves	11 671 369	11 671 490	752 343	752 464
Retained earnings / (loss)	1 817 113	( 798 456)	10 116 893	1 797 484
Total shareholders' equity	18 412 205	15 796 757	10 894 046	2 574 758
Non current liabilities
Deferred tax liabilities	1 601 482	1 636 448	-	-
Non current lease liability	119 737	127 510	119 737	33 520
Total non current liabilities	1 721 219	1 763 958	119 737	33 520
Current liabilities
Trade and other payables	6 512 537	3 686 266	6 306 967	943 460
Provisions	5 101	20 549	5 101	5 402
Income tax payable	1 227 497	276 279	1 227 497	72 628
Total current liabilities	7 745 135	3 983 094	7 539 565	1 021 490

Total equity and liabilities	27 878 559	21 543 809	18 553 348	3 629 768
AUDITED ABRIDGED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2022

				INFLATION ADJUSTED

			Share	Non
			capital	distributable	Retained
			and premium	reserve	earnings	Total
			ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
Balance as at 1 October 2020	4 923 723	38 912 076	(30 661 342)	13 174 457
Total comprehensive income for the year	-	-	2 622 300	2 622 300
Disposal of joint venture	-	( 93 478)	93 478	-
Transfer between reserves	-	(27 147 108)	27 147 108	-
Balance as at 30 September 2021	4 923 723	11 671 490	( 798 456)	15 796 757
Total comprehensive income for the year	-	-	2 615 448	2 615 448
Transfer between reserves	-	( 121)	121	-
Balance as at 30 September 2022	4 923 723	11 671 369	1 817 113	18 412 205

AUDITED ABRIDGED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 SEPTEMBER 2022

			HISTORICAL *

		Share	Non
		capital	distributable	Retained
		and premium	reserve	earnings	Total
		ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
Balance as at 30 September 2020	24 810	962 797	18 577	1 006 184
Total comprehensive income for the year	-	-	1 568 574	1 568 574
Disposal of joint venture	-	( 471)	471	-
Transfer between reserves	-	( 209 862)	209 862	-
Balance as at 30 September 2021	24 810	752 464	1 797 484	2 574 758
Total comprehensive income for the year	-	-	8 319 288	8 319 288
Transfer between reserves	-	( 121)	121	-
Balance as at 30 September 2022	24 810	752 343	10 116 893	10 894 046
AUDITED ABRIDGED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2022

		INFLATION ADJUSTED	HISTORICAL *

		2022	2021	2022	2021
		ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000

Cash generated from operating activities	7 859 019	6 492 789	11 419 794	2 046 535
(Increase) / decrease in working capital	(3 235 958)	(2 241 293)	(7 107 638)	(1 117 139)
Cash generated from operations	4 623 061	4 251 496	4 312 156	929 396

		(3 104 254)	(3 705 762)	(2 177 484)	( 607 978)
Interest received	49 936	17 940	24 545	4 058
Tax paid	(3 154 190)	(3 723 702)	(2 202 029)	( 612 036)

Net cash generated from operating activities	1 518 807	545 734	2 134 672	321 418

Investing activities	(1 607 679)	( 525 114)	( 995 232)	( 160 250)

Purchase of plant and equipment for maintaining operations	(1 629 820)	( 758 665)	(1 008 513)	( 164 279)
Purchase of property, plant and equipment for expanding operations	( 29 026)	( 325 312)	(12 579)	( 78 383)
Proceeds on disposal of property, plant and equipment	51 167	109 722	25 860	14 123
Proceeds on disposal of joint venture	-	449 141	-	68 289

Net cash (utilised) / generated before nancing activities	( 88 872)	20 620	1 139 440	161 168

Financing activities	( 141 318)	( 10 913)	( 78 479)	( 2 868)

Lease liability payments	( 141 318)	( 10 913)	( 78 479)	( 2 868)

Net (decrease) / increase in cash and cash equivalents	( 230 190)	9 707	1 060 961	158 300

Cash and cash equivalents at the beginning of the year	1 751 615	1 741 908	460 464	302 164
Cash and cash equivalents at the end of the year	1 521 425	1 751 615	1 521 425	460 464
REPRESENTED BY:
Bank balances, cash and short term deposits	1 521 425	1 751 615	1 521 425	460 464

NOTES TO THE AUDITED ABRIDGED CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2022

CORPORATE INFORMATION
Nampak Zimbabwe Limited is a public limited Company incorporated and domiciled in Zimbabwe. The main activities of the Group are manufacturing of paper, plastic and metal packaging products and leasing of biological assets and property. The abridged consolidated nancial statements for Nampak Zimbabwe Limited and its subsidiaries (the Group) for the year ended 30 September 2022 were authorised for issue in accordance with a resolution of the directors on 20 January 2023.
BASIS OF PREPARATION
- These abridged consolidated nancial statements have been prepared in accordance with International Financial Reporting Standards (IFRS), the disclosure requirements of the Zimbabwe Stock Exchange Listing Rules and the Companies and Other Business Entities Act (Chapter 24:31).
  The abridged consolidated nancial statements of the Group have been prepared based on the current cost basis and adjusted for the effects of IAS 29 'Financial Reporting in Hyperinationary Economies'. Comparative nancial statements are restated using the general ination indices in terms of the measuring unit current at the statement of nancial position date. The primary nancial statements of the Group are the ination adjusted numbers.
- The historic amounts are shown as supplementary information. This information does not comply with the International Financial Reporting Standards in that it has not taken into account the requirements of International Accounting Standard 29 - Financial Reporting for Hyperinationary Economies. As a result the auditors have not expressed an opinion on this historic nancial information.

The conversion factors have been adopted from the Consumer Price Index (CPI) data prepared by the Zimbabwe National Statistics Agency (ZIMSTAT). The indices and conversion factors used to restate the nancial results are as follows:

	Indices	Conversion factor
CPI as at 30 September 2022	12,713.1	1.00
CPI as at 30 September 2021	3,342.0	3.80

FUNCTIONAL AND PRESENTATION CURRENCY
These abridged consolidated nancial statements are presented in Zimbabwe dollars (ZW$), which is the functional and presentation currency of the Group. All values are rounded to the nearest thousand except where otherwise stated.
STATEMENT OF ACCOUNTING POLICY
The accounting policies are consistent with those used in the prior year, except where international Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) have been amended or adopted.
DIRECTORS' RESPONSIBILITY
The Company's Directors, under the Companies and Other Business Entities Act (Chapter 24:31), are responsible for the preparation and fair presentation of the Group's consolidated nancial statements and related information.
These abridged consolidated nancial statements are presented in accordance with the disclosure requirements of the Zimbabwe Stock Exchange (ZSE), the International Financial Reporting Standards (IFRS) and the Companies and Other Business Entities Act (Chapter 24:31).
The Directors caution stakeholders and users in their interpretation of these nancial statements following the change in the functional currency effective February 2019 and the requirement in 2019 from PAAB and ICAZ to publish ination- adjusted accounts in accordance with International Accounting Standard (IAS 29 - Financial Reporting in Hyperinationary Economies).
The Directors have reviewed the performance and nancial position of the Group and are satised that the Group and Company have sufcient nancial resources to continue as a going concern.

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DIRECTORS: K. C. Katsande (Chairman), J. P. Van Gend* (Group Managing Director), M. Matafeni* (Group Finance Director), A. H. Howie, S. H. Murray, H. Neser (Mrs), Q. Swart, M. M. Valela (Alt, A. Makamure)

(*Executive)

P O Box 4351, Harare, 68 Birmingham Road, Southerton, Harare, Zimbabwe Telephone 662730/9, 0772192291/3

NAMPAK ZIMBABWE LIMITED

AUDITED ABRIDGED CONSOLIDATED RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2022

6. EARNINGS PER SHARE

Basic earnings per share amounts are calculated by dividing net prot or loss for the period attributable to ordinary equity holders by the number of ordinary shares in issue

Headline earnings is based on net prot for the period attributable to members after adjusting for other income net of tax

Basic and headline earnings per share are based on a weighted average of 755 648 101 (2021 : 755 648 101) ordinary shares in issue during the period.

		INFLATION ADJUSTED	HISTORICAL *

		2022	2021	2022	2021
		ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
Earnings per share

Earnings attributable to ordinary members	2 615 448	2 622 300	8 319 288	1 568 574
Ordinary shares in issue at period end	755 648 101	755 648 101	755 648 101	755 648 101
Earnings per ordinary share (cents)	346.12	347.03	1 100.95	207.58
Determination of headline earnings on continuing operations
Prot for the period	2 615 448	2 632 933	8 319 288	1 568 024
Adjust for:
Net exchange gain on foreign currency- net of tax	(1 891 351)	(13 722)	(1 641 341)	(3 969)
Retrenchment and restructuring costs - net of tax	44 884	-	15 360	-
Fair value gain on biological assets - net of tax	(23 161)	(50 554)	(23 161)	(12 216)
Gain on disposal of property, plant and equipment - net of tax	(20 144)	( 4 743)	(11 479)	(1 052)
Gain on disposal of joint venture	-	(153 135)	-	(35 973)
Total headline earnings from continuing operations	725 676	2 410 778	6 658 667	1 514 814
Headline earnings / loss from discontinued operations
Share of (loss) / prot from joint venture	-	(10 633)	-	550
Headline earnings per share - continuing operations
Headline earnings attributable to ordinary members	725 676	2 410 778	6 658 667	1 514 814
Ordinary shares in issue at period end	755 648 101	755 648 101	755 648 101	755 648 101
Headline earnings per ordinary share (cents) -
	continuing operations	96.03	319.03	881.19	200.47
Headline earnings per share - discontinued operations
Headline earnings attributable to ordinary members	-	(10 633)	-	550
Ordinary shares in issue at period end	755 648 101	755 648 101	755 648 101	755 648 101
Headline earnings per ordinary share (cents) -
	discontinued operations	-	(1.41)	-	0.07

7. AUDITORS STATEMENT

"Whilst these Summarised Group nancial statements are themselves not audited, they should be read in conjunction with the complete set of the Group nancial statements for the year ended 30 September 2022, on which these are based. The complete

set of the Group nancial statements for the year ended 30 September 2022 which have been audited by Deloitte & Touche and the auditor's report thereon, are available for inspection at the Company's registered ofce. A qualied audit opinion was issued thereon due to non-compliance with International Accounting Standard 21 - "The Effects of Changes in Foreign Exchange Rates" with respect to comparative and current nancial information on property, plant and equipment, depreciation, deferred tax and retained earnings.

The engagement partner responsible for this audit is Tapiwa Chizana PAAB practice certicate number: 0444."

8. GROUP OPERATING SEGMENT REPORT

The basis of segmentation and basis of measurement of segment prot or loss for the current reporting period is consistent with the last reported annual nancial statements.

Segment reporting for the year ended 30 September 2022

			INFLATION ADJUSTED

		Printing &	Plastics	Services &
		Converting	& Metals	Eliminations	Total
		ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
Sales to local customers	19 091 450	28 404 729	-	47 496 179
Sales to export customers	3 700 903	1 275 903	-	4 976 806
Other sales	48 789	-	-	48 789
Intersegmental sales	575 083	54	(575 136)	-
Total Sales	23 416 225	29 680 685	(575 136)	52 521 774

Results from continuing operations
Trading income	3 867 690	6 386 432	87 288	10 341 411
Operating prot	3 945 921	5 306 231	(534 227)	8 717 925
Net nance income / (costs)	73 913	(74 998)	32 579	31 494
Taxation charge	(3 000 174)	(3 013 942)	(119 855)	(6 133 971)
Prot for the year	817 299	1 502 768	295 381	2 615 448

Other information
Segment assets	12 922 583	14 077 731	878 245	27 878 559
Segment liabilities	4 582 653	4 719 014	164 687	9 466 354
Capital expenditure	410 048	1 179 231	69 568	1 658 846
Depreciation and amortisation	527 698	749 128	(203 048)	1 073 778
Other material (income) / expenses	(1 043 550)	(576 914)	(863 102)	(2 483 566)
Monetary loss on hyperination	1167 681	2 369 169	570 202	4 107 052

Segment reporting for the period ended 30 September 2021
Sales to local customers	14 460 308	19 374 546	-	33 834 854
Sales to export customers	2 048 877	764 878	-	2 813 755
Other sales	37 836	-	-	37 836
Intersegmental sales	353 840	4 423	(358 262)	-
Total Sales	16 900 860	20 143 847	(358 262)	36 686 445

Segment reporting for the period ended 30 September 2021

			INFLATION ADJUSTED

		Printing &	Plastics	Services &
		Converting	& Metals	Eliminations	Total
		ZW$ 000	ZW$ 000	ZW$ 000	ZW$ 000
Results from continuing operations
Trading income	2 749 623	3 827 969	199 957	6 777 549
Operating prot	2 575 820	3 156 900	9 971	5 742 691
Finance (costs) / income	(14 238)	(8 516)	40 693	17 939
Taxation charge	(1 512 003)	(1 551 151)	(64 543)	(3 127 697)
Prot / (loss) from continuing operations	1 049 579	1 597 233	( 13 879)	2 632 933

Discontinued operations
Net loss from joint venture	(10 214)	-	(419)	(10 633)
Prot / (loss) for the year	1 039 365	1 597 233	( 14 298)	2 622 300

Other information
Segment assets	10 960 789	10 385 659	197 361	21 543 809
Segment liabilities	3 586 671	2 529 708	(369 329)	5 747 051
Capital expenditure	231 612	834 538	17 828	1 083 978
Depreciation and amortisation	466 217	689 486	(194 377)	961 326
Other material (income) / expenses	(259 779)	9 270	(38 295)	(288 804)
Monetary loss on hyperination	433 582	661 797	228 283	1 323 662

	Segment reporting for the period ended 30 September 2022

					HISTORICAL

				Printing &	Plastics		Services &
				Converting	& Metals	Eliminations	Total
				ZW$ 000	ZW$ 000		ZW$ 000	ZW$ 000
	Sales to local customers	9 285 015	16 091 823	-	25 376 838
	Sales to export customers	4 320 242	821 255	-	5 141 497
	Other sales	29 566	-	-	29 566
	Intersegmental sales	337 775	41 029	(378 804)	-
	Total Sales	13 972 598	16 954 107	(378 804)	30 547 901

	Results from continuing operations
	Trading income	3 436 542	5 456 848	135 310	9 028 700
	Operating income	4 529 674	6 030 468	659 235	11 219 377
	Net nance income / (costs)	33 507	( 36 589)	17 066	13 984
	Taxation charge	(1 276 565)	(1 580 523)	(56 985)	(2 914 073)
	Prot for the year	3 286 616	4 413 356	619 316	8 319 288
	Other information
	Segment assets	8 633 769	9 601 953	317 627	18 553 348
	Segment liabilities	3 685 017	3 829 129	145 156	7 659 302
	Capital expenditure	322 579	653 870	44 643	1 021 092
	Depreciation and amortisation	75 109	55 329	(36 268)	94 170
	Other material (income) / expenses	(1 093 131)	(573 621)	(523 925)	(2 190 677)

	Segment reporting for the period ended 30 September 2021
	Sales to local customers	3 192 725	4 286 510	-	7 479 235
	Sales to export customers	454 972	171 753	-	626 725
	Other sales	8 220	-	-	8 220
Intersegmental sales	76 833	7 493	(84 326)	-
Total Sales	3 732 750	4 465 756	(84 326)	8 114 180

Results from continuing operations
Trading income	853 422	1 143 380	34 727	2 031 529
Operating prot	914 825	1 141 440	44 550	2 100 815
Net nance income / (costs)	(2 875)	( 1 988)	8 921	4 058
Taxation charge	(233 655)	(291 280)	(11 914)	(536 849)
Prot / (loss) from continuing operations	678 295	848 172	41 557	1 568 024
Discontinued operations
Net loss from joint venture	528	-	22	550
Prot / (loss) for the year	678 823	848 172	41 579	1 568 574

Other information
Segment assets	1 812 850	1 857 540	(40 622)	3 629 768
Segment liabilities	652 842	498 074	(95 906)	1 055 010
Capital expenditure	55 461	183 321	3 880	242 662
Depreciation and amortisation	43 808	17 694	(36 950)	24 552
Other material (income) / expenses	(61 402)	1 940	(9 824)	(69 286)

9. OTHER MATERIAL INCOME / (EXPENSES)

				INFLATION ADJUSTED		HISTORICAL

				2022	2021		2022	2021
				ZW$ 000	ZW$ 000		ZW$ 000	ZW$ 000

Retrenchment, termination and restructuring costs	(59 622)	-		(20 404)	-
Fair value gain on biological assets	30 766	67 155		30 766	16 228
Net exchange gain / (loss) on foreign currency	2 512 422	18 228		2 180 315	5 272
Gain on disposal of joint venture	-	203 421		-	47 786
Total	2 483 566	288 804		2 190 677	69 286

COMMENTARY

OPERATING PERFORMANCE

I am pleased to report on the results of the year ended 30th September 2022.

The overall demand for packaging improved signicantly during the year, compared to the previous year. The Company benetted from the economic recovery, which was led by the rebound in agriculture and mineral commodity prices. Management has continued with its focus on cost containment, whilst looking for new opportunities to improve both product offerings and quality. We continue to invest in the business where we see opportunity.

The Group achieved sales for the year in ination adjusted terms of ZW$ 52,52 billion (2021: ZW$ 36,69 billion) and a hyperinated

trading income before adjustments of ZW$ 10,34 billion (2021: ZW$ 6,78 billion). A prot before tax of ZW$ 8,75 billion was achieved

(2021: ZW$ 5,76 billion).

The prot before tax takes into account other material income of ZW$ 2,48 billion and a net monetary loss of ZW$ 4,11 billion. Other income, in the main, comprises of exchange gains on foreign denominated debtors and cash balances.

Management worked hard on cost reduction initiatives and improving the working capital cycles. The Comprehensive Prot Attributable to Shareholders amounted to ZW$2.62 billion (2021: ZW$ 2,63 billion). Earnings per share at 346,12 cents (2021: 347,03 cents) were below prior year.

ENTITY REVIEWS

PRINTING AND CONVERTING SEGMENT

Hunyani Paper and Packaging

The sales volumes for the full year improved by 11,9% compared to prior year. The improvement was due to rm demand for tobacco cartons throughout the year, on the back of an improved tobacco crop and regional exports. Demand was somewhat curtailed by raw material supply constraints. Demand at Cartons and Labels Division was subdued.

PLASTICS AND METALS SEGMENT

Mega Pak

The full year sales volumes increased by 7,4% versus prior year mainly due to strong demand across all product categories and improved raw material availability. Exports recovered in the regional markets compared to the prior year.

CarnaudMetalBox

The sales volumes for the full year grew by 9,1% compared to the prior year. The improvement was driven by strong growth in the closures and metals categories. HDPE volumes were slightly down.

INDUSTRIAL RELATIONS

At the close of the nancial year, Nampak employed 467 permanent employees compared with 533 the previous year. Overall, industrial relations have remained productive. At NEC level there were numerous wage increases during the year, and there continues to be pressure from employees to cushion them against the current hostile economy. We are continuously reviewing our manpower structures to ensure they are in line with business requirements. The Group continues with its training programmes aimed at developing and retaining skills across the board.

CAPITAL EXPENDITURE

Capital expenditure in hyperination terms amounted to ZW$ 1,66 billion (2021: ZW$ 1,08 billion) and focused mainly on completion of projects commenced in the previous year. There are some signicant capital projects currently being reviewed by management and should funds become available, it is our intention to implement them.

DIVIDEND

The need to retain sufcient reserves to cover the working capital requirements remains a priority, as does the need for capital expenditure to upgrade our plant. Under these circumstances, which also include continuing economic uncertainty, the Directors have decided to waive declaration and payment of a dividend. However, consideration is being given to the payment a dividend in 2023. (2021: Nil).

APPRECIATION

The 2022 trading year has not been without its challenges, but also brought welcome volume growth. The year ahead may bring some economic head winds, but I believe that the continual focus on cost control and margin preservation has positioned the Group well to meet these challenges. None of this would have been possible without the commitment and dedication of the management teams and staff at all three operating companies. I would like to take this opportunity to thank all of them for all their efforts this year and for embracing the challenges they faced.

Our customers and suppliers have continued to support us and I would like to express my gratitude to them. I would also like to thank Nampak Limited for their continued technical support, without which these results would not have been achieved.

I would like to express my thanks to the Chairman and the Board of Directors for their support and encouragement during the past year.

By Order of the Board

J. P. Van Gend	68 Birmingham Road
Group Managing Director	Southerton, Harare
20 January 2023

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P O Box 4351, Harare, 68 Birmingham Road, Southerton, Harare, Zimbabwe. Telephone 662730/9, 0772192291/3

INDEPENDENT AUDITOR'S REPORT ON THE AUDIT OF INFLATION ADJUSTED CONSOLIDATED FINANCIAL STATEMENTS TO THE SHAREHOLDERS OF NAMPAK ZIMBABWE LIMITED

Qualified Opinion

We have audited the inflation adjusted consolidated financial statements of Nampak Zimbabwe Limited and its subsidiaries ("the Group") set out on pages 21 to 59 which comprise the inflation adjusted consolidated statement of financial position as

at 30 September 2022, and the inflation adjusted consolidated statement of profit or loss and other comprehensive income, the inflation adjusted consolidated statement of changes in equity and the inflation adjusted consolidated statement of cash flows for the year then ended, and the notes to the inflation adjusted consolidated financial statements, including a summary of significant accounting policies.

In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion section of our report, the inflation adjusted consolidated financial statements present fairly, in all material respects, the inflation adjusted consolidated financial position of the Group as at 30 September 2022, and its inflation adjusted consolidated financial performance and inflation adjusted consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS) and in the manner required by the Companies and Other Business Entities Act (Chapter 24:31), the relevant Statutory

Instruments ("SI") SI33/99 and SI62/96.

Basis for Qualified Opinion

Impact of incorrect date of application of International Accounting Standard (IAS) 21 "The Effects of Changes in Foreign Exchange Rates" with respect to comparative and current financial information on property, plant and equipment, depreciation,

deferred tax and retained earnings.

On 20 February 2019, a currency called the RTGS Dollar was legislated through Statutory Instrument 33 of 2019 ("SI 33/19")

with an effective date of 22 February 2019. SI 33/19 fixed the exchange rate between the RTGS Dollar and the USD at a rate of 1:1 for the period up to its effective date. The rate of 1:1 is consistent with the rate mandated by the RBZ at the time it issued the bond notes and coins into the basket of multi currencies. The below events were indicative of economic fundamentals that

would require a reassessment of the functional currency as required by International Accounting Standard (IAS) 21- "The Effects of Changes in Foreign Exchange Rates":

The Group transacted using a combination of United States Dollars (USD), bond notes and bond coins. Acute shortage of USD cash and other foreign currencies in the country, resulted in an increase in the use of different modes of payment for goods and services, such as settlement through the Real Time Gross Settlement (RTGS) system and mobile money platforms. During the year there was a significant divergence in market perception of the relative values between the bond note, bond coin, mobile money platforms, RTGS FCA in comparison to the USD. Although RTGS was not legally recognised as currency up until 22 February 2019, the substance of the economic phenomenon, from an accounting perspective, suggested that it was currency.

In October 2018, banks were instructed by the Reserve Bank of Zimbabwe ("RBZ") to separate and create distinct bank accounts for depositors, namely, RTGS FCA and Nostro FCA accounts. This resulted in a separation of transactions on the local RTGS payment platform from those relating to foreign currency (e.g. United States Dollar, British Pound, and South African Rand).

Prior to this date, RTGS FCA and Nostro FCA transactions and balances were co-mingled. As a result of this separation, there was an increased proliferation of multi-tier pricing practices by suppliers of goods and services, indicating a significant difference in purchasing power between the RTGS FCA and Nostro FCA balances, against a legislative framework mandating parity.

INDEPENDENT AUDITOR'S REPORT ON THE AUDIT OF INFLATION ADJUSTED CONSOLIDATED FINANCIAL STATEMENTS TO THE SHAREHOLDERS OF NAMPAK ZIMBABWE LIMITED

Basis for Qualified Opinion (continued)

For the period up to 22 February 2019, the Group maintained its functional currency as the USD, with transactions and balances reflected using an exchange rate of 1:1 in compliance with S1 33/19. From 22 February 2019, balances and transactions were retranslated at the legislated inaugural exchange rate of 1:2.5 between the USD and the ZWL in compliance with the requirements of SI33/19.

Whilst the timing of this conversion was in line with the dictates of SI 33/19 it constituted a departure from the requirements

of IAS 21, and therefore the 2019 financial statements were not prepared in conformity with IFRS. Consequently, this impacted the financial information on which the requirements of IAS 29 " Financial Reporting in Hyperinflationary Economies" were

subsequently applied. Had the Group applied the requirements of IAS 21, the 30 September 2019 comparative inflation adjusted consolidated financial statements with respect to property plant and equipment, depreciation, deferred tax and retained earnings would have been materially impacted. The carry over effects materially impact the current year and comparatives for property plant and equipment, depreciation, deferred tax and retained earnings as at 30 September 2022. The financial effects of this departure on the inflation adjusted consolidated financial statements have not been determined.

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the inflation adjusted Consolidated Financial

Statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are

relevant to our audit of inflation adjusted consolidated financial statements in Zimbabwe. We have fulfilled our ethical responsibilities in accordance with these requirements and the IESBA code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the inflation adjusted consolidated financial statements of the current period. These matters were addressed in the context of our audit of the inflation adjusted consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Other than the matter described in the Basis for Qualified Opinion section, we have not determined any other key audit matters to be communicated in our report.

Other information

The Directors are responsible for the other information. The other information comprises the Mission Statement, Financial Highlights, Group Structure, Chairman's statement, Group Managing Director's Report, Directors, Group Management and

Administration, Operating Units and Management Structure, Statement of Corporate Governance and Directors' Responsibility, Directors' Report, Statistics, Preparer of the Financial Statements and the consolidated historic cost financial information, which we obtained prior to the date of this auditor's report. The other information does not include the consolidated financial statements and our auditor's report thereon.

Our opinion on the inflation adjusted consolidated financial statements does not cover the other information and we do not express an audit opinion or any form of assurance conclusion thereon.

In connection with our audit of the consolidated statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the inflation adjusted consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information that we obtained prior to the date of this auditor's report, we conclude that there is a material misstatement of this other information, we are required to report that fact. As described in the Basis for Qualified Opinion section above, the Group changed their functional currency to the RTGS$ effective 22 February 2019. The date of change in functional currency that complies with IFRS is 1 October 2018. Consequently, the USD transactions between the period 1 October 2018 to 22 February 2019 did not comply with the requirements of IAS 21 as they were not appropriately translated. We have determined that the other information is misstated for that reason.

INDEPENDENT AUDITOR'S REPORT ON THE AUDIT OF INFLATION ADJUSTED CONSOLIDATED FINANCIAL STATEMENTS TO THE SHAREHOLDERS OF NAMPAK ZIMBABWE LIMITED

Responsibilities of the directors for the inflation adjusted consolidated financial statements

The directors are responsible for the preparation and fair presentation of the inflation adjusted consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) and the requirements of the Companies and Other Business Entities Act of Zimbabwe (Chapter 24:31) and relevant statutory instruments and for such internal control as the directors determine is necessary to enable the preparation of inflation adjusted consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the inflation adjusted consolidated financial statements, the directors are responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the inflation adjusted consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the inflation adjusted consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our

opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these inflation adjusted consolidated financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the inflation adjusted consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the inflation adjusted consolidated financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the inflation adjusted consolidated financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the inflation adjusted consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

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Nampak Zimbabwe Ltd. published this content on 30 January 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 January 2023 07:03:08 UTC.

End-of-day quote Zimbabwe S.E. Other stock markets 06:00:00 2024-04-04 pm EDT			5-day change	1st Jan Change
1,080 ^ZWL	+6.09%		0.00%	+266.10%

Nampak Zimbabwe Limited Reports Earnings Results for the Full Year Ended September 30, 2023	Feb. 11	CI
Nampak Zimbabwe Limited Reports Earnings Results for the Half Year Ended March 31, 2023	23-06-29	CI
Nampak Zimbabwe Limited Reports Earnings Results for the Full Year Ended September 30, 2022	23-01-24	CI
Nampak Zimbabwe Limited Reports Earnings Results for the Half Year Ended March 31, 2022	22-06-03	CI
Nampak Zimbabwe Limited Reports Earnings Results for the Full Year Ended September 30, 2021	22-02-07	CI
Amalgamated Regional Trading Holdings Limited completed the acquisition of remaining 50% stake in Softex Tissue Products Ltd from Nampak Zimbabwe Limited for $0.8 million.	21-05-04	CI
Nampak Zimbabwe Limited Announces Director Changes	20-05-07	CI
Nampak Zimbabwe Limited Reports Audited Abridged Consolidated Earnings Results for the Year Ended September 30, 2019	20-02-19	CI
Nampak Zimbabwe Limited Reports Audited Consolidated Earnings Results for the Year Ended September 30, 2017	17-11-27	CI
Nampak Zimbabwe Limited Reports Earnings Results for the Six Months Ended March 31, 2017	17-05-16	CI
Nampak Zimbabwe Limited Reports Consolidated Audited Earnings Results for the Year Ended September 30, 2016	16-11-18	CI
Nampak Zimbabwe Limited Reports Consolidated Unaudited Earnings Results for the Six Months Ended 31 March 2016	16-05-02	CI
CarnaudMetalbox Zimbabwe Limited and Mega Pak Zimbabwe (Pvt.) Ltd. completed the acquisition of Hunyani Holdings Ltd. from Nampak Limited and others in a reverse merger transaction.	14-12-22	CI
CarnaudMetalbox Zimbabwe Limited and Mega Pak Zimbabwe (Pvt.) Ltd. made an offer to acquire Hunyani Holdings Ltd. from Nampak Limited and others in a reverse merger transaction.	14-07-22	CI

	1st Jan change	Capi.
NAMPAK ZIMBABWE LIMITED	+266.10%	2.53B
BALL CORPORATION	+21.35%	21.97B
AVERY DENNISON CORPORATION	+8.34%	17.64B
CROWN HOLDINGS, INC.	-12.49%	9.62B
CCL INDUSTRIES INC.	+19.15%	9.29B
SILGAN HOLDINGS INC.	+3.78%	5.01B
SEALED AIR CORPORATION	-13.09%	4.62B
VISCOFAN, S.A.	+12.87%	2.98B
GREIF, INC.	-5.60%	2.96B
PACTIV EVERGREEN INC.	+13.27%	2.78B

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Feb. 12	Nampak Zimbabwe Limited Reports Earnings Results for the Full Year Ended September 30, 2023	CI
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