OHLTHAVER & LIST · Company) and its affiliated companies, for the period 1 July 2016 to 30 June...

I N T E G R A T E D A N N U A L R E P O R T

OHLTHAVER & LIST

SINCE 1919 OUR GROUP OF COMPANIES HAS BEEN INSPIRED BY THE LAND TO CREATE A SUSTAINABLEFUTURE THAT HAS LASTING IMPACT ON THE NAMIBIAN ECONOMY AND ITS PEOPLE.

FROM RESOURCE TO RESULTS.

Page 6 ABOUT THIS REPORT

About this Integrated Annual Report

Page 9 ABOUT OHLTHAVER & LIST Vision 2019, Group Portfolio, Directorate & Administration, Group Executive Team, Operating Structure, Materiality, Supply Chain

Page 34 UNDER REVIEW Executive Chairman’s and Chief Executive Officer’s Message, Operational Review

Page 54 SUSTAINABILITY Corporate Governance, Economic, Social and Environmental Sustainability

Page 88 REPORTS Assurance Statement, Group Value Added Statement, Seven Year Review, Financial Review, Group Reference Information,

Notice to Shareholders, Proxy Form

PLEASE GO TO WWW.OHLTHAVERLIST.COM TO VIEW OUR FINANCIAL STATEMENTS AND GRI INDEXApproval of Financial Statements, Independent Auditor’s Report, Report of the Directors, Statements of Financial Position,

Statements of Profit or Loss and Other Comprehensive Income, Statements of Changes in Equity, Statements of Cash Flows,

Accounting policies, Notes to the Annual Financial Statements.

ABOUT THIS ANNUAL REPORT

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The Ohlthaver & List Group remains committed to embracing its

obligations as a corporate citizen towards the wide variety of spheres

in which it operates, including its shareholders, employees and the

environment. At the same time, we are aiming to build and sustain a

sound corporate reputation while creating conditions that are conducive

to profitable businesses. This is apparent in the Group’s Purpose: ‘Creating

a future, enhancing life’, which is inextricably linked to uplifting our

communities and protecting the environment in a sustainable manner.

Guided by our Purpose, the Group strives to bring quality of life and

wellbeing to people in order to improve the socio-economic conditions

of citizens; create conditions for everyone to succeed; continually pioneer

and operate at breakthrough levels; build innovative and sustainable

businesses; and generate long-term profitability.

This Integrated Annual Report provides a detailed overview of the

impacts of all sustainability-related activities of the Ohlthaver & List

Group (hereafter referred to as Ohlthaver & List, O&L, the Group, or the

Company) and its affiliated companies, for the period 1 July 2016 to 30

June 2017. In accordance with the recommendations of the Corporate

Governance Code of Namibia (NamCode), based on the Third Report of

the King Commission on Corporate Governance in South Africa (hereafter

referred to as King III), its content is intended to provide information on

all sustainability-related aspects of Ohlthaver & List’s operations in the

year under review. Furthermore, the Report is intended to provide an

indication of the Company’s ability to continue to create such value for

our stakeholders in the future.

This Report has been compiled in accordance with the principles of the

G4 Reporting Standard (Core) of the Global Reporting Initiative (GRI).

Along with associated relevant information and the GRI Index, this Report

is also available on the Ohlthaver & List website at www.ohlthaverlist.com.

In the preparation of this Integrated Annual Report, O&L has attempted

to identify and report on the most significant sustainability- related

considerations and impacts arising from the core activities of the Group,

as well as all significant internal and external stakeholder groups with

which the Group engages around these issues.

For additional information regarding this Integrated Annual Report and its

contents, readers are invited to contact Roberta Brusa, Group Company

Secretary, on +264 61 2075111 Ext. 5313, or by email at [email protected].

THE SCOPE AND BOUNDARY OF THE INTEGRATED ANNUAL REPORT

This Integrated Annual Report covers the operations of the Ohlthaver

& List Group in their entirety − including those of its subsidiaries and

joint ventures − in all markets in which these entities operated over the

reporting period. In this regard, an overview of the Group is included in

the Report, on pages 14-17.

The Integrated Annual Report is designed to provide all stakeholders with

relevant information regarding the value creation offered by the Group

through its activities on an annual basis, as well as the economic, social

and environmental impacts arising from these activities. Operational

activities are analysed within the context of the food production, fishing,

beverages, farming, retail-trade, information technology, property

leasing and development, marine engineering, steel-retailing, renewable

power-generation and leisure and hospitality industries that the Group

has interests in, as well as the broader macroeconomic climate in which

the Group operates.

The Integrated Annual Report also discusses Ohlthaver & List’s risks and

opportunities, as well as its forward planning for sustainable growth.

It represents a milestone along the route towards the integrated and

targeted reporting that all stakeholders require in order to acquire well-

informed opinions of the Group and its activities.

ABOUT THIS INTEGRATED ANNUAL REPORT


Source data is gathered from the Group’s various operating divisions and

is, to the best extent possible, integrated so as to provide comparable

performance data.

The Report includes disclosures on both financial and non-financial

aspects of the Group. Financial disclosures correspond with those of

the Company’s Annual Financial Statements for the 2017 financial year,

a document that was compiled in accordance with the requirements

of the Companies Act (Act 28 of 2004) of Namibia and complies with

International Financial Reporting Standards (IFRS).

With respect to the availability of non-financial data, in instances where

insufficient data exists to address various quantitative indicators included

in the GRI G4 Guidelines, the Report then focuses on relevant policies

and practices that have been implemented within the Group and its

subsidiaries − particularly those related to regulatory compliance in

various areas.

MATERIALITY

It is the opinion of the Ohlthaver & List Board and management that the

information presented in this 2017 Integrated Annual Report is the most

relevant, or material, to the Group and its various stakeholder groups.

PROCESS FOR IDENTIFYING CONTENT

In analysing the information to be included in the Integrated Annual

Report, the Board and management considered two primary questions:

firstly, “Who is our reporting aimed at?” and secondly, “What decisions will

they be able to make based on our reporting?”

In this context, it is the intention of Ohlthaver & List that this Integrated

Annual Report:

- Informs and adds value for all stakeholders with a valid interest in the

Group;

- Considers all issues that can impact on the Group’s ability to create

value for these stakeholders; and

- Reports as comprehensively as possible on the known and potential

impacts of these issues for the Group and its stakeholders.

In identifying the issues and information to be included in this Report,

the Board considered the relative importance of each matter in terms

of its known or potential effects on Ohlthaver & List’s ability to continue

creating value for all its stakeholders. These matters were then ranked

in terms of relevance to the intended readership of the Report, so that

non-pertinent information could be set aside. We believe that this is in

line with the reporting principles for defining report content as defined

by the GRI.

This process is intended to produce accurate and comprehensive

sustainability reporting, unburdened by the peripheral data that tends

to confuse rather than enlighten. Readers are welcome to request more

detailed information on any particular aspect of the Report.

Further information regarding Ohlthaver & List’s material issues and

associated stakeholder groups can be found in this Report in the sections

dealing with Stakeholder Engagement (page 25) and Materiality (page 27).

ASSURANCE

Ohlthaver & List is confident that this Report provides a comprehensive

and balanced account of the Company’s financial management as well

as its environmental, social and governance (ESG) performance over the

year under review. The sustainability reporting principles and processes

employed by Ohlthaver & List are aligned with those of the GRI G4

Reporting Standard and this Report has been subjected to a process

of independent third-party assurance. The assurance statement can be

found on page 88.


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FORWARD-LOOKING STATEMENTS

While this Integrated Annual Report is intended as a retrospective

review of Ohlthaver & List’s sustainability performance over its most

recently completed financial year, it also includes certain forward-looking

statements regarding the Group’s intended performance in these areas

in the future.

Although Ohlthaver & List believes that the expectations and outcomes

reflected in such forward-looking statements are reasonable, no

assurance can be provided that such expectations will ultimately prove

correct. Accordingly, future outcomes could differ materially from those

set out in these forward-looking statements as a result of (among other

factors): changes in economic and market conditions; the success of

business and operating initiatives; changes in the regulatory environment

and/or other government action; fluctuations in commodity prices and

exchange rates; and business and operational risk management.

A discussion of the sustainability-related risks and opportunities facing

Ohlthaver & List is included in the Corporate Governance section of this

Report, on page 54.

CONTACT DETAILS

O&L Group of Companies

Alexander Forbes House

7th Floor, South Block

23-33 Fidel Castro Street

Windhoek, Namibia

Postal address:

P.O. Box 16, Windhoek, Namibia

Corporate Relations:

Tel: +264 61 2075111

Fax: +264 61 234021

WHO WE AREOUR BUSINESS PROFILE

As a truly African company employing more than 6 100 people in various

business sectors, the Ohlthaver & List Group is rooted in, and committed

to, Africa and her diverse communities. The Group emerged in 1919 from

the early Ohlthaver & List Bank Kommission partnership between Hermann

Ohlthaver and Carl List; subsequently Ohlthaver & List Finance and Trading

Corporation Limited (Olfitra) was established in Namibia on the 13th of May

1923. The Group’s Headquarters is located in Windhoek, Namibia.

Today, O&L represents Namibia’s largest privately held group of companies,

with revenues contributing in excess of 5% to GDP. It has business

interests in food production, fishing, beverages, farming, retail trade,

information technology, property leasing and development, renewable

power-generation, marine engineering, steel retailing, advertising, and

the leisure and hospitality industry.

The parent companies of Olfitra are O&L Holdings (Proprietary) Limited

and List Trust Company (Proprietary) Limited, with the controlling

shareholder of the O&L Group being the Werner List Trust.

With annual revenues of over N$6 billion, O&L is a major contributor to

the state coffers and is in the position of being a significant contributor

to GDP in Namibia. Wherever they operate, the companies of our diverse

Group are actively engaged in uplifting the lives of our employees, our

consumers, and society more generally. We at O&L are relentless in our

pursuit of a sustainable future for all and therefore passionately embrace

our Purpose: ‘Creating a future, enhancing life’ in everything we do,

while actively pursuing our Vision: ‘To be the most progressive and

inspiring company’.

ABOUT OHLTHAVER & LIST


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STRATEGIC OUTCOMES

The most progressive and inspiring company

BREAKTHROUGH ARCHITECTURE

CREATING A FUTURE, ENHANCING LIFE

PURPOSE

Let’s Talk | Let’s do it | Hooked on results | Naturally today for tomorrow | We grow people | We do the right thing right | We all serve

VALUES

N$2 billion EBIT | 4 000 additional employment opportunities | Employer of choice | 20% reduction in carbon footprint

BREAKTHROUGH METRICS

Everyone purposefully

producing breakthrough

everywhere

Amazing experiences,

enduring impact

Sustainable execution

in everything

2019 STRATEGIC AREAS OF FOCUS

Everyone is deeply connected to

purpose, lives the values and is

proud of what they do

Everyone is successful, thriving

and making things happen in

breakthrough mode

Everyone is valued, recognised

and appreciated for the

difference they make

Consistent experiences, amazing

relationships, lasting impact

Purity inspired, reliable quality,

impacting the whole

Always there, simple and easy,

the natural choice

Excellence in everything,

executed with care

Sustaining growth, ever-expanding,

securing the future

Bringing sustainability everywhere,

impacting the world

Inspired by integrity, creating trust

and confidence

2019 VISION

TO BE THE MOST PROGRESSIVE

AND INSPIRING COMPANY

LET’S TALK

Open, honest, down-to-earth,

from-the-heart communication

LET’S DO IT Deliver on tasks with speed

and quality

HOOKED ON RESULTS Committed to delivering breakthrough

outcomes

NATURALLY TODAY FOR TOMORROW

Caring about the future,

caring about everyone

WE GROW PEOPLE Taking responsibility and providing

opportunities for growth

WE DO THE RIGHT THING RIGHT

Bringing thinking to everything

WE ALL SERVE Serving the purpose, owning

the whole, everyone matters


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BRANDTRIBE

Established in 2012, Brandtribe is a joint venture

between O&L and Techsys (CT). Brandtribe is a

multi-channel consumer optimisation platform

combining return on investment and the underlying

data to provide brands with a sustainable competitive

advantage in the digital age. Brandtribe has created

and manages two digital platforms: the Brandtribe

SMS gateway and the Brandtribe e-CRM platform.

Brandtribe tracks the digital effectiveness of brands

all in one place, from advertising effectiveness to

consumer interactions.

BROLL NAMIBIA

Broll and List Property Management (Namibia)

(Proprietary) Limited (Broll Namibia) is a strategic

partnership between O&L and the Broll Property

Group, SA. Established in 2003, it has been

managing O&L’s Commercial Portfolio which

includes Wernhil Park, Standard Bank Centre/Town

Square, Alexander Forbes House/Carl List Mall, the

Old Breweries Building and Pick n Pay Centre in

Walvis Bay. Broll Namibia also manages 3rd party

properties including The Grove Mall and B1 City

and has recently obtained the management

contract for the Dunes Mall in Walvis Bay.

DIMENSION DATA NAMIBIA

Dimension Data Namibia (Proprietary) Limited

was established in November 2006 as a business

partnership between the O&L Group and

Dimension Data Middle East and Africa. It has

grown considerably since then and is currently

one of Namibia’s most successful information

technology (IT) solution providers. It services

highly strategic Namibian clients, both within and

outside the O&L Group, and has a global footprint

with great penetration in Africa.

KRAATZ MARINE

Kraatz Marine (Proprietary) Limited was

established in 1947 and provides engineering

and related services to the oil and gas, mining,

and general industrial sectors. These services

include ship repair, rig repair, fabrication,

machining, welding and construction.

HANGANA SEAFOOD

Hangana Seafood (Proprietary) Limited, established

in 1997, is the operating company for the white

hake quota holders, Consortium Fisheries Limited

and Kuiseb Fish Products (Proprietary) Limited.

Hangana Seafood is recognised as a leader in

the Namibian fishing industry and has a wet-fish

fleet of eight vessels. The company’s land-frozen

products are mainly exported to Australia, France,

Germany, Italy, the Netherlands, Spain, the United

States, and the Southern African Development

Community (SADC) region.

GROUP PORTFOLIO


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NAMIBIA BREWERIES

Established in 1920, Namibia Breweries

Limited (NBL) is a frontrunner in the beverage

manufacturing sector in Namibia. The company

leads the domestic beer market and its brands

have a significant share of the premium beer

category in southern Africa. Brewed by choice

according to the Reinheitsgebot of 1516,

NBL beer enjoys a fine reputation for quality

and purity, for which its brands have earned

international recognition.

NAMIBIA DAIRIES

Namibia Dairies (Proprietary) Limited was created

in 1997, following the merger of Rietfontein

Dairies and Bonmilk. Since then it has grown into

Namibia’s primary dairy and juice manufacturing

company, with a total annual production in

excess of 37 million litres. The company is

the country’s market leader, with significant

market share in all its product categories. It also

operates one of the most modern dairy farms

in the world, the !Aimab Superfarm, which is

located in Mariental in southern Namibia.

O&L ENERGY

O&L Energy (Proprietary) Limited focuses on

renewable energy. It develops, designs, procures

and implements renewable energy projects,

especially medium- to large-scale solar power

and bioenergy systems. O&L Energy and its

international partners offer the highest German

engineering and efficiency standards, with the

best workmanship and reliability possible. These

result in maximum energy saving results, as well

as important contributions to the improvement

of our environment.

O&L LEISURE

The O&L Leisure Portfolio is made up of the

106-room Mokuti Etosha Lodge; the 46-room

Midgard Country Estate; the boutique, 16-room

Chobe Water Villas lodge; and the 125-room,

4-star Strand Hotel Swakopmund. Built on a

historic and iconic site, with unique and creative

entertainment areas like restaurants, bars, a deli,

lobby lounge, sea-facing terraces, and a beach

take-away – the Strand Hotel has become a

premier destination for residents of Swakopmund

as well as for visitors from around the world.

MODEL PICK N PAY

Leading retailer Model Pick n Pay is the direct

descendant of Model Supermarkets. In 1997 a new

franchise agreement was entered into with

Pick n Pay South Africa. The first Model Pick n Pay

supermarket was subsequently inaugurated in

1997. To build its brand, Model Pick n Pay has

embarked on a strategy to extend its network

of franchise stores throughout Namibia, with

22 stores countrywide to date. The franchisee

attributes their success to the delivery of quality,

variety, customer service and value for money.

WEATHERMEN & CO

A joint-venture between O&L and leading Cape

Town advertising agency, The Jupiter Drawing

Room, Weathermen & Co. started with a staff

complement of 5 in 2013. Today, 19 staff

strong, this through-the-line communication

agency is proving to be a bellwether for its

clients and the advertising industry as a whole

and continues to secure new additions to its

flourishing list of clients. Its employees stand

proud as the weathermen, and ambassadors of

inspiration in advertising in Namibia.

WINDHOEK SCHLACHTEREI

Windhoek Schlachterei (Proprietary) Limited,

acquired in the 1970s, is known for its processed

meat products crafted in the European

continental tradition. The company is the

second-largest processed meat producer in the

country, with a local market share volume of

16%. Windhoek Schlachterei was fully integrated

into Namibia Dairies in 2010 to consolidate and

optimise its manufacturing, sales and distribution,

marketing, and administrative functions on its

journey to becoming a sustainable operation.

O&L CENTRE

The Ohlthaver & List Centre (Proprietary)

Limited comprises two divisions. O&L Corporate

includes the Group Leadership Team, which

leads group strategy; the Centre of Excellence

renders specialist services ranging from payroll

and human capital support to SAP business

management software and IT services to all

operations in the O&L Group.

KRAATZ STEEL

Kraatz Steel, a division of WUM Properties

(Proprietary) Limited, operates from Walvis Bay

and Tsumeb and has been engaged in industrial

steel supplies in Namibia since 1995. The

company supplies steel, steel-related products,

and non-ferrous metals to marine engineering

and construction companies, the mining sector

(on land and offshore), fishing factories/vessels,

oil and petroleum plants, and the general

public.


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DIRECTORATE AND ADMINISTRATION

NON-EXECUTIVE DIRECTORS

UM STRITTER

Vice-chairman

Appointed to the Board on 24 March 1994

Elected vice-chairman on 17 April 2002

C-L LIST

Appointed to the Board on 27 February

1980

E ENDER (German)

Appointed to the Board on 23 June 2008

HH MÜSELER

Appointed to the Board on 20 March 2014

GOVERNOR LV MCLEOD-KATJIRUA

Appointed to the Board on 2 April 2012

REVEREND WS HANSE

Appointed to the Board on 2 April 2012

EXECUTIVE DIRECTORS

S THIEME

Executive Chairman

Appointed to the Board in 2001

Elected Chairman of the Board on 17 April

2002

P GRÜTTEMEYER

Chief Executive Officer

Appointed to the Board on 1 October 2003

G HANKE

Group Financial Director

Appointed to the Board on 16 November

2004

B MUKUAHIMA

Group Human Capital Director

Appointed to the Board on 1 May 2006

G SHILONGO

Group Corporate Affairs Director

Appointed to the Board on 9 July 2014

P HOEKSEMA

Alternate to S Thieme

Appointed to the Board on 1 October 2015

ADMINISTRATION

Company Registration Number 331

(Incorporated in Namibia)

SECRETARY

Ohlthaver & List Centre (Pty) Ltd

Postal address:

PO Box 16

Windhoek

BUSINESS ADDRESS AND REGISTERED OFFICE

7th floor – South Block

Alexander Forbes House

23-33 Fidel Castro Street

Windhoek

AUDITORS

Deloitte & Touche

Registered Accountants and Auditors

Chartered Accountants (Namibia)

PO Box 47

Windhoek

ATTORNEYS

Engling, Stritter & Partners

PO Box 43

Windhoek

BOARD COMMITEES

AUDIT COMMITTEE

HH Müseler, Chairman

P Grüttemeyer

REMUNERATION COMMITTEE

Dr C Swart-Opperman, Chairman (appointed 19 July 2016)

P Grüttemeyer


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2

1. SVEN THIEME Executive Chairman 2. PETER GRÜTTEMEYER Chief Executive Officer 3. BERTHOLD MUKUAHIMA Group Human Capital Director

4. PATRICIA HOEKSEMA Group Manager: Corporate Relations 5. GIDEON SHILONGO Group Corporate Affairs Director

6. GÜNTHER HANKE Group Financial Director 7. HERMAN THERON MD: Hangana Seafood 8. TERENCE MAKARI MD: O&L Leisure

9. HENDRIK VAN DER WESTHUIZEN MD: Namibia Breweries 10. NORBERT WURM MD: Model Pick n Pay

GROUP EXECUTIVE TEAM 1

3 4

5 6

7 8

9 10


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11. SONJA BARTSCH MD: Eros Air 12. LEON CROUS MD: Weathermen & Co 13. BERND WALBAUM MD: O&L Energy

14. GÜNTHER LING MD: Namibia Dairies & Windhoek Schlachterei 15. ROWAN KLEINTJES MD: Dimension Data 16. MIKE REILLY MD: Brandtribe

17. MARTIN THERON MD: O&L Centre 18. EIKE KRAFFT Director: Emerging Business 19. DIRK VAN NIEKERK MD: Kraatz Marine

20. MARCO WENK MD: Broll Namibia

11 12

13 14

15 16

17 18

19 20


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The Board acknowledges that there is no majority of Non-executive

Directors that are categorised as independent due to the O&L Group of

Companies being majority owned by two entities (Werner List Trust and

O&L Holdings).

Just as this Integrated Annual Report is prepared for a group of

companies, there are boards of directors at various subsidiaries. The

governance framework is determined by O&L and is then driven down to

each and every subsidiary.

CODE OF CONDUCT AND BUSINESS ETHICSPOLICY

A formal Code of Ethics and Business Conduct is in place to set out

standards of integrity in dealing with suppliers, customers, business

partners, stakeholders, government, and society generally. Every

employee is required to subscribe to this Code and strict adherence to

it is a condition of employment. Employees are also required to declare

other business interests, possible conflicts of interest, as well as any gifts

they receive that might leave them vulnerable to undue influence.

Compliance with the Code is monitored and employees are encouraged

to report any suspected contravention of the Code or other perceived

unethical behaviour.

The Group has implemented Tip-Offs Anonymous whereby employees,

suppliers and customers can report unethical activities without fear of

being identified. Tip-Offs Anonymous is operated by a company that is

wholly independent of O&L.

STAKEHOLDER ENGAGEMENTThe Group Purpose: ‘Creating a future, enhancing life’ is directed towards

stakeholders within and beyond the business operations. As the Group

realizes the impact its stakeholders have on the business, a proactive

stakeholder-inclusive approach to stakeholder engagement is embraced

by the Group leadership. O&L’s approach to stakeholder engagement

is determined by the principles of influence and dependency on the

Group, and this informs appropriate dialogue between the Group and its

stakeholders. O&L realizes that its stakeholders must be treated equitably

and therefore everyone strives to achieve an appropriate balance

between the interests of all the groups’ stakeholders in the best interest

of the Company.

Members of the Group’s Sustainability Steering Committee and O&L

Corporate conduct an annual stakeholder identification and impact

assessment with particular focus on the following Stakeholder groups:

A Employees

B Utilities Providers

C Government/Regulators

D Consumers/Customers

E Suppliers

F Financiers

G Industry Bodies

H Media

I Civil Society

J Trade Unions

K Equity Owners

As a critical stakeholder group, employees enjoy regular and constant

interaction through various employee engagement initiatives inclusive of

face-to-face communication, social media, e-mails, road shows, surveys,

intranet, social events, training sessions, performance reviews, leadership

conferences, staff meetings and internal publications.

STATEMENT OF COMPLIANCE The O&L Group is of the opinion that for the year under review, it is

substantially compliant in all material respects with the principles of the

Namibian Companies Act (2004) and the Corporate Governance Code of

Namibia (NamCode).

INTRODUCTIONThe O&L Group is committed to the highest standards of corporate

governance, including those promoted in the NamCode as well as the

King Report on Governance for South Africa, (King III), and has established

a process to review compliance with the recommendations they contain.

Particulars regarding O&L’s compliance with the NamCode are set out in

the Integrated Annual Report and where there has not been compliance,

explanations have been provided.

OUR OPERATING STRUCTUREDuring the period under review, the Board comprised six Executive

Directors and six Non-executive Directors. The names and appointment

dates of each of the Directors are set out on page 18.

The roles of the Executive Chairperson and the Chief Executive Officer are

kept separate in order to ensure a balance of power and authority, with

no one individual therefore having unrestricted decision-making powers.

The Board is responsible for the strategic direction of the Group: matters

reserved for the Board and its committees’ consideration are formally

defined to ensure that the Directors retain full and effective control

over the Group with specific regard to strategic, financial, organisational,

and compliance matters. All members of the Board have a fiduciary

responsibility to represent the best interests of the Group and all of its

stakeholders. All Directors have the appropriate breadth of expertise

to undertake their duties and have significant influence at meetings,

thereby ensuring a balance of authority and precluding unfettered

decision-making by any one Director. Procedures for appointment are

formal, transparent and for the full Board’s consideration − although

shareholders are ultimately responsible for the composition of the Board.

Appointment procedures involve evaluating the existing balance of skills

and experience within the Group and include a process of assessing the

Group’s needs.

A Director’s Induction Programme serves to familiarise incoming

Directors with the Group’s operations as well as its business environment,

strategies, Director’s duties, and the sustainability issues relevant to the

business.

A Board Evaluation Programme forms part of the Director’s Governance

Policy. It is implemented through the office of the Company Secretary

and the Audit Committee Chairman.

Generally, Directors have no fixed term of appointment but retire by

rotation. At each of the Group’s Annual General Meetings, at least one

third of the Directors retire (these being the Directors who have served

the longest since their last election). If they indicate that they are

available, they then are considered for reappointment. The Board of

Directors is chaired by the Executive Chairperson at the time; due to the

vast experience and in-depth knowledge he has of O&L businesses, the

incumbent has been retained in the position over this reporting period.

An evaluation of the independence of Non- executive Directors resulted

in the following assessment:

NON-EXECUTIVE DIRECTORS INDEPENDENCE

UM Stritter Shareholder representative

E Ender Independent

HH Müseler Independent

C-L List Shareholder representative

Reverend Hanse Shareholder representative

Governer McLeod-Katjirua Shareholder representative


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In order to remain competitive and adjust its product and service offerings

to meet the ever-changing needs of its customers and consumers, the

O&L Group actively engages these stakeholders through direct dialogue,

social media and marketing and advertising activities, as well as through

market research and perception surveys, to name but a few. This is done

on a daily, weekly and quarterly basis (as required) in order to nurture

the relationships that exist and to seek these stakeholders’ continuous

support in securing long-term business growth.

The Group’s commitment to sustainability is also evidenced in its

management of supplier (especially Utilities providers as utilities is a

material issue) relations through regular, direct engagement, by which

means the Group continuously strives to work together in fostering

healthy relations that are beneficial to all parties involved.

In addition to its proactive communication with all stakeholders through

various channels ranging from traditional media to digital platforms,

O&L also engages with its shareholders through the quarterly List

Trust, O&L Holdings and Olfitra board meetings, as well as its AGM (and

on other occasions when necessary). Namibia Breweries Limited also

has an AGM and various communication channels through which it

interacts with shareholders. The Group’s financial results are also available

on the O&L website and are shared widely through various stakeholder

engagements. In this way, The Group keeps shareholders informed on

its aggressive growth journey and seeks their approval for the major

investment decisions required.

MATERIALITY PROCESSOhlthaver & List must address an array of issues related to the operations

of our businesses and how they impact society over any reporting period.

To ensure that the most important issues are prioritised, a Materiality

Analysis was conducted by appropriate members of senior management

in the year under review. This examined the potential impact of specific

sustainability issues from both stakeholder and Company perspectives.

Level of concern

Effe

ct/I

mp

act

O&L MATERIALITY MATRIX

LOW HIGH

LOW

HIG

H

B

DG

A

C

E

F

A Water

B Energy

C Regional political and economic variables (interest rates/foreign

exchange/supplier security)

D Regulatory environment

E Cost of doing business (incl. taxes, levies, excise duties etc)

F Growth and expansion (potential limitations, including disposable income)

G Skills – shortage and retention

Employee engagement activities aim to align employees with the

Group’s Purpose, Vision and Breakthrough Architecture as well as to

achieve the group vision metric of remaining an employer of choice in

its fields of operation. In caring for its employees, the Group continues

to invest in training and development through talent programmes and

other leadership development initiatives (such as the O&L World, BMS

(Breakthrough Management Skills) and LFP (Leadership Foundation

Programme)). The results of the group’s employee engagement

initiatives − which are not just the prerogative of the human capital

departments but are owned by the leadership throughout the Group −

are evidenced by the fact that following the winning of four consecutive

years of the Deloitte Best Company To Work For accolade, the group has

further secured a Seal of Excellence for Namibia in the Great Place to

Work For Survey, Africa, which is testimony to the Groups continued high

performance as an employer of choice.

Employees have several channels available to them to raise their concerns

and make recommendations, or to obtain feedback from the leadership

teams ranging from workplace forums, to various departmental meetings

and engagement sessions. These sessions keep employees and unions

informed of issues relevant to the critical role that they play in relation

to business performance while also creating a platform for addressing

issues that may arise. Staff have the opportunity to discuss matters of

concern to them − thus ensuring the group continues to live up to its

‘Let’s Talk’ Value. The Tip-offs Anonymous hotline administrated by an

independent service provider, Deloitte (South Africa) also supports the

group’s “Let’s talk value” and its value of ‘We do the right things right’.

The Audit Committee is responsible for embedding a culture of high

ethical standards.

All Directors may seek independent advice at the Company’s expense under

appropriate circumstances in the discharge of their responsibilities. Directors

have access to the expertise of the Company Secretary at all times.

Engagement with its stakeholders beyond the organisation is also a

priority for the O&L Group. As such, the O&L Group actively and regularly

engages with government and regulatory bodies through face-to-face

meetings, telephone calls, and e-mails. Other forms of engagement

include the submission of compliance returns; dialogue to understand

and support the strategy of government {Vision 2030, Harambee

Prosperity Plan, Namibia Equitable Economic Empowerment Framework

(NEEEF) and Namibia Investment Promotion Act (NIPA)}; talks to remain

aligned with the regulations set by the various regulators; and adherence

to these regulations by maintaining open, honest and transparent

relationships. The Group’s sound relations with government are evident in

its commitment and support to the Growth at Home strategy through its

use of local suppliers and investment in job creation; payment of taxation

on time and as per legislation; and decreasing its carbon footprint by

continuously seeking more sustainable energy sources, to name but a

few examples.

As a caring corporate citizen, the Group is not only concerned with

managing its direct and indirect impacts on the spheres within which it

operates, but also in regularly engaging with its communities through

various means − be it the company’s commitment to continuously

adapting to meet the needs of its customers, or through its ongoing

corporate social responsibility and social investment initiatives − activities

that take place on a regular basis wherever the Group operates. In

delivering against its Strategic Area of Focus: ‘Amazing relationships,

enduring impact’, O&L prides itself in being a leader of positive change,

not only within its organisation, but beyond. This is evidenced through

the Group’s commitment to various organisations (such as Team Namibia

and the Namibia Chamber of Commerce and Industry) and industry

bodies (such as the Self-regulating Alcohol Industry Forum and the

Recycle Namibia Forum) in which it plays a significant role through its

leadership and active participation.


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F GROWTH AND EXPANSION: LIMITATIONS TO MARKETS (external and

internal to organisation):

Growth and expansion are of great importance in enhancing our

competitive advantages and benefiting the Group’s customers,

particularly in respect to our fishing, brewing, dairy, leisure, and retail

operations. The Group’s supply chain is also dependent on growth,

with limitations to expansion having a material impact. Quotas, distance

from the market, and market saturation in Europe all limit the growth

of our fisheries operations. The local market for breweries is limited

and dependent on national growth, thus requiring a focus on South

Africa and other export markets. Existing production capacities and

low-cost imported dairy products (which erode our local market share)

both limit our ability to achieve economies of scale in the dairy industry

and jeopardise continued local production. The extremely competitive,

limited, and saturated local market currently limits the growth of the

Group’s retail operations, making this sector dependent on national

growth. Social challenges − such as poverty, crime, and land-ownership

issues − also constrain industrial and commercial growth. Across the

Group this material issue is expected to drive increased focus on

innovation to ensure that our products, services and operations remain

relevant to all stakeholders.

G SKILLS - SHORTAGE AND RETENTION (internal to organisation):

Namibia experiences a tremendous shortage in particular skill sets and

these impact all our operations on a general level (i.e., in technical, IT,

risk management, and logistics areas) as well as affecting the availability

of industry-specific technical skills in the brewing, dairy, hospitality, and

fishing sectors.

THE GROUP SUBSCRIBES TO THE FOLLOWING EXTERNALLY DEVELOPED

ECONOMIC, ENVIRONMENTAL AND SOCIAL CHARTERS AND PRINCIPLES:

- The Companies Act (Act 28 of 2004) of Namibia

- The Corporate Governance Code of Namibia (NamCode)

MEMBERSHIPS AND ASSOCIATIONS - Self-Regulating Alcohol Industry Forum (SAIF) - NBL

- Hospitality Association of Namibia (HAN) – NBL & O&L Leisure

- Namibia Manufacturing Association (NMA) – O&L

- Namibia Environmental & Wildlife Society (NEWS) – O&L

- Recycle Namibia Forum (RNF) – O&L

- Namibia Employer Federation (NEF) – O&L

- Team Namibia (TN) – O&L

- Namibia Scientific Society (NSS) – O&L

- Namibia Chamber of Commerce and Industry (NCCI) – O&L

- Dairy Producers Association (DPA) – ND

- Namibia Hake Fishing Association – Hangana

AWARDS RECEIVEDNamibia Breweries was awarded the Gold Award as the Namibia

Manufacturers Association (NMA) Corporate Manufacturer of the Year

2016, and Overall Winner of the NMA Corporate Manufacturer of the Year

2016.

NBL’s Windhoek Lager brand also won its 11th consecutive gold medal

at the Deutsche Landwirtschafts Gesellschaft (DLG Awards). Windhoek

Draught and Urbock also won gold, while Windhoek Light and Tafel

Lager won silver awards at the DLG awards. The international DLG Quality

Evaluation rates beer brands brewed according to the Reinheitsgebot

(“Purity Law”) of 1516 against quality specifications for taste, analytical

and biological standards. NBL was awarded a Long Service Award for 10

years of successful participation in the DLG quality test.

The effectiveness of our management approach to material aspects is

reflected in risk management assessments and the Group is confident

that all material issues have been adequately mitigated.

KEY MATERIAL ASPECTS IDENTIFIED IN THE PROCESS

A WATER (external to organisation):

Drought and water scarcity together constitute a national issue that

impacts all our companies, but especially the beer, soft drink, and dairy

operations. Mitigation of the water risk has received significant attention

as water supply challenges have the potential to limit the Company’s

growth and expansion. Gratifying results were achieved not only in

ensuring business continuity through water-saving initiatives at all our

operations, but also through rigorous stakeholder engagement with

government and other key players. Although the situation has improved

somewhat after a recent good rainy season, the Group believes that the

crisis and related challenges should be viewed as continuous and long

term.

B ENERGY (internal and external to organisation):

Namibia remains a net importer of electricity and despite the recent

medium-term contracts that the national supplier has concluded with

its Southern African counterparts, long-term availability is not secured.

Electricity-supply infrastructure also remains a concern and the probability

of load shedding cannot be excluded. The cost of electricity remains

a concern too, especially in the retail sector where it is a significant

overhead cost. In this regard it should be noted that commercial and

industrial electricity tariffs in the Windhoek area have increased by 115%

over the last six years.

C REGIONAL POLITICAL AND ECONOMIC VARIABLES - interest rates/

foreign exchange/supplier security. (external to organisation):

The somewhat uncertain political situation across southern African, but

especially in South Africa, has rendered the Namibia dollar unstable over

the last two reporting periods and this has had mixed impacts on the

cost of imported raw and packaging materials from outside of the region

and the exports of fish products. In addition, the region is registering

lacklustre economic growth which, coupled with the government’s

recent payment record to its suppliers, has added to our concerns.

D REGULATORY ENVIRONMENT (external to organisation):

While Namibia enjoys political stability alongside a healthy regulatory

environment, certain of its policy frameworks do have impacts on

the Group’s operations, be these financial or from a compliance point

of view. In addition to complying with existing legislation, the Group

also actively participates in dialogue around planned legislation. The

draft of the proposed Namibia Equitable Economic Empowerment

Framework (NEEEF) is a case in point, whereby the Group continues

to make recommendations to policymakers to ensure that Namibia’s

transformation objectives are met in a responsible and sustainable

manner. Emerging legislation around investments, procurement, and

deed transfers have raised additional concerns to the Group, necessitating

further engagement with regulators.

E COST OF DOING BUSINESS (incl. taxes, levies, duties etc.) (external to

organisation):

The Group’s operations − as well as all role players in the supply chain

− are affected to a greater or lesser extent by various uncontrollable

costs, such as training levies, fishing industry levies, export duties, local

government rates and taxes, environmental levies, and the costs of

utilities (such as water, electricity, and effluent tariffs). Being reliant on

single suppliers (including parastatals) results in non-competitive pricing

when compared against imported products, influencing the costs of

doing business in Namibia.


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SUPPLY CHAIN FRAMEWORKWithin the various operating companies (OpCos) of the O&L Group of

Companies, supply chain management (SCM) encompasses the planning

and management of all activities pertaining to sourcing and procurement,

conversion of raw materials into finished goods, and logistics. Critically,

it also includes coordination and collaboration with channel partners:

suppliers, intermediaries, third-party service providers, and customers.

In essence, SCM integrates supply and demand management within and

across our companies and their stakeholders. Within the Group, SCM is

seen as an integrating function whose primary responsibility is linking

the major business functions and business processes within the relevant

OpCos and across their relevant value chains. The management of the

supply chain includes all of the logistics-management activities noted

above as well as manufacturing operations; SCM drives coordination of

processes and activities with and across marketing, sales, product design,

finance, and information technology.

In line with O&L’s value system and strategic intent, the management

of the supply chain is conducted under the following framework:

- Critical information systems relevant to the management of the supply

chain are maintained by the O&L OpCos. These might include: enterprise

resource planning (ERP)/material requirements planning (MRP)

solutions; forecasting and planning tools such as Futurmaster and

Forecast Pro; warehouse management systems; and routing and

scheduling systems.

Should service providers be able to provide their own solutions, the

ownership of the data vests within the O&L OpCos to enable the

flexibility necessary to engage in regular request for quotation (RFQ)/

request for information (RFI) or tender processes.

- Use of service providers: in order to manage supply chains effectively

and efficiently, we encourage the use of specialised service providers

across our operations. The identification of potential service providers

lies at the discretion of the relevant OpCo but should be guided by the

following criteria:

- Cost efficiency;

- Innovation;

- Sustainability (focused on the sustainable use of natural, human, and

financial resources);

- ‘Local content’ and the empowerment of SMEs; and

- Reliability and anticipated service levels.

OpCos are obliged to manage service providers by means of signed

contracts and service level agreements, as well as through regular and

frequent service reviews.

Contractual engagements with service providers is limited to three years,

thereafter the provision of services is tendered/offered in the open

market.

The management of supply chain functions is conducted in line with the

ISO 9001:2008 quality standard.

Material impacts on the Group’s supply chain are covered under the

section ‘Materiality Process’.

VAST SPACES

HOMEGROWN BARLEY

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The year under review can be described as a highly volatile and challenging

period. On the global front, stagnant global trade, subdued investment,

and heightened policy uncertainty marked another difficult year for the

world economy. A subdued recovery is expected for 2018, with receding

obstacles to activity in commodity exporters and solid domestic demand

in commodity importers. Weak investment is weighing on medium-term

prospects across many emerging markets and developing economies

(EMDEs). Although fiscal stimulus in major economies, if implemented, may

boost global growth above expectations, risks to growth forecasts remain

tilted to the downside. (2017 World Bank Report on Global Economic Prospects)

On the local front, it is benign to state that the Namibian economy is

emerging from a perfect storm. The adverse impact of the commodity

price crash, a slowing global economy and low growth in large neighbouring

economies was exacerbated by the continuous drought and water crisis

impacting agricultural production and the construction industry, amongst

others - all contributing to an extremely tough and challenging financial

year. Economic growth has slowed in 2016 to an estimated 1.3 percent.

Despite these developments, and the slow economic recovery in Namibia’s

main trading partners, the weak growth in commodity prices and increasing

uncertainty in the global geopolitical environment, the medium-term

prospects for our economy have started to look better. Growth is projected

to be 2.5 percent in the coming financial year and average approximately 3.5

percent over the Medium-term Expenditure Framework (MTEF). (Republic of

Namibia - Ministry of Finance, 2017/18 Budget Statement)

Despite the challenging economic environment, we are optimistic that the

global activity is firming broadly as expected. Furthermore, in Namibia, we

are privileged to operate in an environment where Government and the

Private Sector openly discuss matters of strategic importance, seek solutions

to challenges, and work together to enhance the business climate so as to

shape a better future.

The O&L Group strategy - supported by a phenomenally strong, passionate

and breakthrough leadership team that drives its execution, has once

again contributed to a solid performance during the year under review

- testament to our breakthrough methodology. The Group’s operating

profit after fair value adjustments declined from N$948.9 million in 2016

to N$874.8 million in 2017. The Group has achieved consistent profitability

for the past decade, growing from an EBIT of N$266 million in 2007 to

N$723.8 million in 2017.

Our Purpose, “Creating a future, enhancing life” inspires our vision – to

become the most progressive and inspiring company - through reaching

a N$2 billion earnings before interest and tax (EBIT) target; reducing our

carbon footprint by 20%; remaining an Employer of Choice, and creating

4 000 additional job opportunities by 2019.

Our people – totaling 6 100 employees, our most important and powerful

asset to transform our business - remained relentlessly committed in

our pursuit of contributing to, and living, our purpose - which is the

backbone of our existence. In fact, had it not been for our hunger to

accomplish our dreams by taking responsibility for ourselves and each

other, we would not have come this far. The O&L Leadership Journey -

whereby all the leadership dimensions are nurtured and developed so

as to enhance breakthrough performance that delivers breakthrough

results - has inspired and enabled us to create an environment where

breakthrough results are supported by focusing on purposefulness,

a risk-free environment, and ownership. Our participation in the Gap

Organisational Alignment Diagnostic for the second year – with a 91%

response rate - has certainly step-changed our leadership resulting in the

individual being elevated from “my ownership” to “owning the whole”.

Our success not only depends on the expertise, talent and professional

development of our people. We recognize that to get the best out of

our people and help them thrive in their work environment, it is the work

experience and satisfaction of our employees that is essential.

JOINT MESSAGE FROM THE EXECUTIVE CHAIRMAN AND THE CEO

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On behalf of the O&L Board of Directors, we would like to express our

heartfelt appreciation for the leadership, dedication and integrity of

our employees – our people. We also extend our sincere gratitude to

our Board of Directors for their leadership, valuable advice, trust and

support. The Government of the Republic of Namibia, our shareholders

and investors, industry partners, associates, customers and consumers

– thank you for believing in us, our people, products, brands and

technologies.

Sven Thieme Peter Grüttemeyer

Executive Chairman Chief Executive Officer

Hence, the successful launch and rollout of the new employee trust

survey and being officially certified as a Great Place to Work in Africa, is

a step in the right direction as we become a more agile and empowered

organization, creating capable and breakthrough leaders.

Some of the proud moments during the year under review includes

Weathermen & Co. obtaining the MTC and FNB Namibia contracts in

an extremely competitive environment; NBL’s continued upward trend

with volumes to South Africa achieving 38% above plan; our investment

property portfolio, Broll’s completion of 77 on Independence mixed-

use development set; Kraatz’ appointment as Namibian agent for

Hitachi Construction - world-renowned for excellence in hydraulics,

manufacturing and repairs, within the mining and construction industries.

Furthermore, OLC Energy’s setting up of the first large solar energy

plant as an independent power producer in Arandis; supporting the

Intelligence Support Against Poaching (ISAP) through donating the Piper

Super Cub plane to strengthen the fight against poaching; developing

our own Sustainability Index to ensure each and every one contributes

to our Vision 2019 carbon footprint target; Hangana Seafood taking over

ownership of the Luderitz Abalone Farm, now known as Hangana Abalone

Farm; Pick n Pay Namibia continuing to roll out its expansion and revamp

programme despite the challenging economic climate, opening the new

B1 City Store and revamping the Katutura and Katima Mulilo stores to

enhance the shoppers experience; and Namibia Dairies setting up the

Farmers Development Programme aimed at diversifying the Namibian

farming community, to name but a few, has greatly impacted on not

only the Group, but the country as a whole. These are but just some of

the achievements that are great examples of how we can surpass the

challenges around us by working together and standing for the success

and future sustainability of our country.

We recognize that our biggest opportunity lies in leveraging off the

benefits of the digital explosion as an enabler in expanding the impact

of the O&L Person; ensuring that the contribution of our inspired people

who passionately live our purpose within and beyond the business,

creates a ripple effect; where people are inspired to achieve the

unimaginable; driving further value addition; prompting the delivery of

new innovations to enhance consumer experiences; and impacting the

whole. Further to that, ensuring that organization-wide breakthrough;

with people who think outside the box and work interdependently,

inspires and contributes to continuous breakthrough within and beyond

the organization.

We are proud, yet humbled, of our contributions to make a difference in

the lives of the communities within which we operate as they reflect the

passion, dedication and hard work of our people and stakeholders alike.

True to our purpose, the Group invested in excess of N$12.3 million in

community initiatives during the period under review, focusing primarily

on education and skills development as key enablers of community

upliftment. Further to that, we recognize the impact our activities have

on the environment, and how these activities can contribute to climate

change, and as such we are committed to be ambassadors for sustainability,

committed to reduce our carbon footprint with 20% by 2019.

Despite the challenging environment experienced during the year

under review, we remain relentless in our pursuit to passionately live our

Purpose, Vision and Values and staying focused on the journey to our 100

Year legacy that will be celebrated in 2019.

We recognize that to get the best out of our people and help them thrive in their work environment, it is the work

experience and satisfaction of our employees that is essential.

“

“

CARBON FOOTPRINTREDUCTION

SOLAR ENERGY PROVIDED

MEGAWATTHOURS

DRINKiQ

PEOPLE TRAINED

TAP STUDENTSSINCE 2008

MIL

CSI

SPENT

LOCAL PROCUREMENT SPENDING

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We reinforced our position in the craft-beer market by working with our

new partner craft breweries, Stellenbrau and Soweto Gold, on product

packaging renovations and format extensions that are better aligned

to consumer needs. Our own craft-beer brand, Camelthorn, was re-

launched in Namibia and South Africa in July 2017. The success of NBL’s

partnership with Heineken South Africa was also a major highlight for

2017.

We recognize the challenges facing Namibia and NBL continues to

leverage its scale and expertise to reduce its environmental impacts while

increasing its positive social outreach. In light of the severe drought that

has plagued Namibia in recent years, NBL’s investments in water security

and water-saving initiatives are a shining example of this commitment.

In addition to ongoing wastewater recycling in the brewing and

packaging plants, NBL drilled three additional boreholes on its premises

in September 2016, bringing our total to five on-site boreholes. These

reduce NBL’s dependency on public water sources since the boreholes

are not linked to the aquifer supplying the City of Windhoek.

We will continue to leverage our portfolio of premium beers; capitalize

on new opportunities in the growing craft-beer segment; and respond to

consumers’ ever-changing needs. We remain committed to the Group’s

Purpose and to taking our breakthrough culture to a new level. This will

ensure that NBL maintains its trajectory towards growth and prosperity

and achieving the Group’s Vision 2019.

FRESH PRODUCENAMIBIA DAIRIES (PROPRIETARY) LIMITED

The vision of Namibia Dairies is to be recognized as a vertically-integrated,

independent dairy, servicing the value chain from farm to fridge.

During the year under review, Namibia Dairies focused on four critical

success factors that contribute to achieving its business goals:

- Our people

- Sustainability;

- Service excellence; and

- Financial growth.

Together, Namibia Dairies and Windhoek Schlachterei delivered revenue

(after discounts and rebates) of N$583 million for the reporting year,

compared with N$570 million during the 2016 financial year. The year-

on-year increase in turnover of 2% is mainly due to an inflationary price

increase on the one side, while sales volumes decreased by 4% on the

other. Sales volumes of fresh milk and Oshikandela drinking yoghurt have

decreased significantly due to increasing import competition, while the

spending power of consumers has been dramatically reduced as a result

of the recession in Namibia.

Total operations generated an operating profit of N$13.9 million in the

2017 financial year compared to N$36.1 million in the 2016 financial year.

The continued focus on the QDVP4 (quality, distribution, visibility, price,

promotion, persuasion and partnerships) Sales Excellence Programme

ensured benefits such as high-quality sales execution, improved sales

performance, improved merchandising standards, and greater consumer

acceptance and recognition.

The !Aimab Superfarm now houses 1,300 cows in milk. The total herd

comprises just over 2,700 animals and produces about 60% of Namibia

Dairies’ raw milk requirements, which in turn meets about 50% of

Namibia’s fresh and UHT milk demand. The high cost of production,

driven by very high feeding costs, remains the biggest challenge to

the !Aimab Superfarm and is the main reason that it remains in a small-

operating-loss position for the year ended 30 June 2017.

BEER AND SOFT DRINKSNAMIBIA BREWERIES LIMITED

Namibia Breweries Limited (NBL) delivered another solid financial

performance in 2017, with operating profit of N$608 million and revenue

of N$2.7 billion, growth of 12.4% and 11.6% respectively. This was achieved

despite a particularly challenging year, which was characterised by severe

drought, unpredictable exchange rates, and rapidly shifting consumer

tastes. In addition, consumer spending contracted in the first quarter

of 2017, resulting in decreased demand for private-sector products and

services. Our performance therefore demonstrates NBL’s resilience and

ability to adapt to changes within our operating environment.

Additional risks to the domestic outlook over the period under review

included: water restrictions due to the drought, the increasing cost of

electricity and municipal services, a weakening exchange rate, rising

interest rates, and increased competition. Despite this, NBL delivered

strong financial results that defied expectations. To succeed in difficult

times, we continue to work hard to ensure that our people’s individual

purposes connect with what we want to achieve as a business. If our

people are strongly aligned with our business goals and have a strong

passion for what we do, we can more easily overcome obstacles and

generate breakthrough thinking that carries our Purpose − ‘Creating a

future, enhancing life’ − into our brands, people practices, and business

initiatives.

Globally, NBL differentiates its export markets as either focus or trading

markets. Focus markets include Tanzania, Mozambique, Zambia, and

Botswana − countries that demonstrate high growth potential and are

flagged for in-market presence and investment. Tanzania remains the

biggest export market, with volumes doubling year-on-year for the

fourth consecutive year. Mozambique remains a challenging market at

present so it will be exciting to see what the future can hold for this

market.

Trading markets include, among others, the United Kingdom, Germany,

and Australia. In these countries, demand for NBL’s products is driven

by expat communities and increasing tourism to Namibia. There is a

commitment to drive presence in these countries as part of our growth

strategy, including, for example, expanding NBL’s reach in the United

States in order to tap into the growing prominence of craft beers

globally. During the year under review, a decision was taken to exit China

as this is not a feasible market currently due to the fiercely competitive

environment.

In the current year, our brand strategy was reviewed in order to focus on

providing consumers with a greater choice of beverages. We launched

our Tafel Lite beer − with 27% less carbohydrate content than Tafel Lager

− as a health-conscious alternative, in line with worldwide consumer

trends.

Innovation in the non-alcoholic category is specifically aimed at supporting

the Group’s commitment to responsible beverage consumption and

diversification. To this end, our new soft drink, Code, offers an additional

non-alcoholic alternative to consumers who are loyal to the Group

product portfolio.

King Lager continues to play a key role in the portfolio. As this home-

grown beer has not yet met market expectations, however, we invested

in various marketing strategies during the year to grow volumes. This

strategy in turn supports the local barley industry, with the ultimate goal

of creating sustainable employment in this business in Namibia. King

Lager therefore remains a purpose-driven initiative for NBL and despite

challenges we are committed to its long-term success.

Globally, the ‘premiumisation’ trend continues, with premium and super

premium beer segments delivering growth ahead of mainstream beer

categories. This includes specialty and craft beers as drivers of choice.

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This, together with the new planned factory will allow Hangana to increase

employment as well as provide more stability through diversification.

Extracting the most value out of catches:

Hangana is currently in the process of planning a new factory, which

will give the company more flexibility in terms of producing a variety of

different products. The estimated cost of the new factory will be N$285

million and it will be owned and operated by a joint venture (JV) between

Hangana Seafood and the Merlus Group. Current indications are that the

JV could potentially include new rights-holder groups, which will then

effectively be part-owners of the JV and will help to consolidate volumes

delivered for processing at the factory.

Local distribution:

With the objective of ensuring that more Namibians enjoy the benefit of

our marine resources, Hangana has decided to invest in developing its

own fish shop to expand its reach and improve the availability of Hangana

products beyond their current distribution channels. This investment will

total N$3.2 million and provide 12 additional employment opportunities.

The fish shop will have two sections, one for retail clients and one for

the general public. Products sold will also include those from Namibia

Breweries, Namibia Dairies and Windhoek Schlachterei.

RETAILMODEL PICK N PAY (A DIVISION OF WUM PROPERTIES (PROPRIETARY)

LIMITED)

As the Group’s Retail Division, Pick n Pay Namibia has had a tumultuous

year as it battled the headwinds from a challenging economy and the

costs linked to its continued expansion and upgrade strategy − while

still meeting the needs of its customers, who are currently feeling the

pressure of the economic slowdown.

Despite these challenges, the division has nevertheless delivered a strong

trade performance, driven by our continued focus on delivering a world-

class shopping experience to our customers in all the towns and cities

where we have a presence. Putting our customers first − by offering the

best ranges, quality products, and great service while delivering value

through competitive pricing − has enabled Pick n Pay Namibia to remain

a leader in the local retail market.

This focus and determination has resulted in the division delivering very

strong sales growth at over 13% for the year to N$1.98 billion (compared

to 15% in FY16) in a very challenging market. Operating profits of N$8.8

million decreased by 48.8% from N$17.2 million recorded in F16.

Our ever-present focus on increasing efficiencies and reducing costs

has limited like-on-like expense growth to an inflation-busting 4%, while

our shrinkage figures are at an absolute world-class level of 0.46% of

turnover (down from 0.6% in the previous year) while total wastage also

stood at a respectable 0.74% (down slightly from 0.8% over the previous

reporting period). Furthermore, even in these difficult times, we have

been successful to some extent in reducing our overall stockholding

without a negative impact on sales, thereby releasing much-needed cash.

The combination of an aggressive competitive environment with sticky

national economic growth has subdued performance in a number

of our larger stores, including Oshakati, Walvis Bay, Swakopmund, and

most importantly Wernhil – all of which have seen reduced profitability

for the year under review. In addition, some of the younger stores have

not yet achieved their planned levels of profitability, including Outapi,

Grootfontein, B1 City and Oshikango, thereby putting further pressure

on the Group’s profit result.

Positive results from the technical quality audits confirm Namibia Dairies’

commitment to quality management and food-safety systems, while the

business continued to optimise systems and processes − thus enhancing

effectiveness and efficiency.

WINDHOEK SCHLACHTEREI (PROPRIETARY) LIMITED

In its seventh year as a component of Namibia Dairies, Windhoek

Schlachterei again showed solid growth and continues to contribute

positively to the operating profit of Namibia Dairies. Like-for-like sales

volumes in Namibia grew by 19% on the previous reporting period, driven

by a strong increase in volumes delivered by our King Polony brand, as

well as fresh cuts.

FISHINGHANGANA SEAFOOD (PROPRIETARY) LIMITED

At Hangana, we focus on delivering healthy value-added seafood offerings

to local and international markets in a sustainable manner and we had a

reasonably good year despite facing various challenges. Turnover increased

slightly to N$549.3 million (2016: N$546.9 million), while operating profit

unfortunately decreased by 25.6% to N$50.3 million (2016: N$67.6 million).

The increase in turnover was mainly a result of increased volumes sold

at better foreign currency prices, yet the increase was partially reduced

by the stronger local currency (when compared to the prior reporting

period). The staggered allocation of quotas throughout the year caused

significant difficulties in scheduling our operations so that the factory

continued to be supplied with raw material; therefore management

had to source expensive raw material to keep the factory running on

all shifts. This put pressure on our margins and resulted in the decrease

in profit compared to the previous year. Given the current economic

climate, however, the company performed well on three O&L vision

metrics, namely the ‘Great Place to Work®’ survey, creating additional

employment, and reducing its carbon footprint.

INVESTMENTS AND FUTURE STRATEGIES:

The company has identified the following five strategic initiatives as critical

to its current strategic planning cycle. Their contributions will benefit all

stakeholders, including government, shareholders, employees, and the

Namibian public:

Abalone farming:

Hangana officially acquired Lüderitz Abalone Farm on 31 March 2017

at a cost of N$13.9 million, rescuing the operation and securing the

livelihoods of 23 employees. The immediate target is to increase the

farm’s capacity from the current 24 tonnes of live animals on hand to 150

tonnes of live animals.

Developing the Consortium and Kuiseb properties into a service hub:

The new finger jetty for Consortium Fisheries Limited has been completed,

and is now in operation. The completion of the finger jetty for Kuiseb Fish

Products (Proprietary) Limited is planned for October 2017. The jetties

will amount to an investment of N$35 million and together with the

envisaged new factory will add tremendous value to Namibia’s fishing

industry as the service hub they comprise will provide much-needed

services to other industry players. The service hub will mainly provide

support to foreign flag vessels, including stevedoring, fuelling, berthing

and clearing, and forwarding and clearing services.

Expanding our trading business globally:

In focusing on the expansion of its global trading business, Hangana

has opened a trading office in South Africa to further cement

relationships with our customers there and to create additional

trading opportunities. Furthermore, over the past 24 months

Hangana has significantly increased its imports of raw material from

both South Africa and South America for value addition in Namibia.

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PROPERTIESBROLL & LIST PROPERTY MANAGEMENT (NAMIBIA) (PROPRIETARY)

LIMITED

CENTRAL PROPERTIES (PROPRIETARY) LIMITED

O&L PROPERTIES (A DIVISION OF WUM PROPERTIES (PROPRIETARY)

LIMITED

WERNHIL PARK (PROPRIETARY) LIMITED

Broll Namibia − the Property Management Company of the O&L

Investment Portfolio and a subsidiary of the O&L Group – has once again

seen a solid performance for the period under review, increasing its

EBIT by 173% to N$4.1 million and has grown its total portfolio under

management from N$3.6 billion to N$3.8 billion as at 30 June 2017.

The total portfolio generated revenue (excluding deferred rentals) of

N$157 million in the year under review (2016: N$150 million), with an

operational EBIT of N$ 125 million (2016: N$115 million). Total EBIT of N$

203 million (2016: N$ 347 million), which includes fair value gains of N$ 78

million (2016: N$232 million).

The period under review has been a challenging year for the Investment

Property Portfolio. The reduced growth in value is a clear reflection of

the overall tough economic conditions faced by most sectors in Namibia

since 2016. These conditions have severely impacted the disposable

income of our primary shopper base which has in turn contributed to

reduced retailer turnovers, lower trading densities and overall foot traffic.

In addition to the poor economic growth, the growth in competitive

retail destinations over the past 3 (three) years has resulted in substantial

alternative for shoppers and retailers within mostly the central region

of Namibia, but also to some extent at Namibia’s central coastal areas.

Together with the fact that the Angolan market is yet to recover, this

has impacted the portfolio’s operational profitability and with this, the

growth in fair value gains. Valuation gains for the financial period under

review were thus substantially lower than prior years, amounting to N$ 78

million (N$ 232 million: 2016). Although the overall financial performance

has seen a downward trend, which was to be expected given the current

economic challenges, the overall fundamentals of the portfolio remain

sound and are poised for growth once economic recovery has been

achieved.

The flagship of the Investment Property Portfolio remains Wernhil Park

Shopping Centre. Valued at over N$ 1.1 billion at the end of the financial

year, Wernhil Park is still a popular shopping destination within the

Windhoek retail landscape. At year-end, the vacancy rate at Wernhil Park

was at a mere 0.3% (0.8%: 2016), which is the lowest vacancy rate for any

regional mall currently trading in Namibia. Foot traffic, although lower

than in the previous year, remains above 1 million feet on average per

month while trading densities remain robust compared to other similar

malls both in Namibia as well as South Africa.

All critical requirements to ensure the commencement of Wernhil

Park Phase 4 were met by the end of the financial year with this highly

anticipated development to commence early in July 2017. The extension

will see the current centre grow from 36,600m2 to over 55,000m2 on

completion. The strong demand for the extension to Wernhil Park is

evident from the fact that over 70% was pre-let before the end of the

financial year, allowing for the securing of retailers for the remainder of

the rental space to take place on or before the completion date, being 1

May 2019. The extension has secured several prominent national brands,

including Checkers, Food Lovers Market, Dischem, the Foschini Group,

Hi-Fi Corporation and Mugg & Bean to name a few.

Alexander Forbes House, with its strategic location, has seen an

exceptional year-on-year value growth with close to 12% to prior year.

These have been offset, however, by the success of our recently opened

stores, including Ondangwa, Mega Centre, Tsumeb, and Okongo; the

refurbished Katima Mulilo store; and our flagship premium stores at Auas

Valley and Oshana − all of which have (to a greater or lesser extent) exceeded

their profit performance compared to the previous financial year.

During the year under review we have invested N$51 million in upgrading

our existing stores and increasing our footprint. This included the

refurbishment and expansion of our Katima Mulilo and Katutura stores,

the relocation of our Oshikango store to a better site, and the opening

of our new B1 City store in Windhoek. All of these developments are

performing according to plan and in line with expectations, apart from

that at Katutura − which is awaiting the completion of the mall upgrade

by the landlord.

In March 2017 we had to close our Otjiwarongo store due to the mall

construction activity planned by the landlord. We aim to open this store

again in the near future, as soon as construction is completed. This will

bring our national footprint to 23 separate sites.

As in prior years, the division pursues innovative activities to enhance the

offering to our customers, including the ongoing rollout of our new POS

system country-wide; the launch of the ticketing platform Webtickets at

all our stores; and introducing new ways of working and processes across

our stores nationally to focus on in-store execution. From a customer

perspective, exciting and innovative promotions were offered, including

our very successful Heroes Campaign, our Johnny-Dollar Campaign,

the ongoing ‘win-a-ride’ competition, late night shopping events, and

category-based themed promotions. Pick n Pay Namibia continues to

advertise aggressively to drive top-line sales growth.

Our focus on fresh offerings once more delivered positive results whereby

our service-area growth for the year consistently exceeded overall store

growth (albeit below plan). Margin control has been a challenge at times

during the year as our customers continue to face household income

challenges, putting pressure on our costings and on maintaining margins

effectively.

A strong increase in customer counts (7%) and an inflation adjusted

increase in basket sizes (6%) confirm our good overall sales performance

while also highlighting further opportunities for growth through

expansion and increased trading activity.

Our continued investment in our workforce through training,

development, and leadership growth has provided the backbone to

our positive performance: we have promoted 16 of our colleagues into

management positions, as well as one to a regional manager post, while

1,564 employee-training interventions were held during the year, of

which 217 consisted of various leadership training events. This once again

demonstrates both the need and the benefit of ongoing investment in

maximising the potential of our employees and shows our continued

ability to develop leadership talent internally.

We continue to enjoy the support of the communities we operate in

through our corporate social investment (CSI) initiatives, including our

soup kitchens and school-support programmes to name but two, while

our ambition to increase purchases from Namibian manufacturers and

suppliers supports and adds value to our local economy.

As economic and market challenges continue, delivering the best

value and shopping experience to our customers and driving further

efficiencies in a sustainable manner throughout the business will remain

our priorities for the foreseeable future.

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O&L Energy has established a network of international and local business

partners at the same time as it is intensifying its marketing activities

in Namibia and South Africa. Cronimet Mining Power Solutions GmbH,

a German engineering company, was brought on board as a strategic

partner for large-scale solar power plants. O&L Energy has also secured

a partnership with a Global leading manufacturer of inverters, with

agencies for technical services and distribution in Namibia.

Together with Namibia Dairies and an external engineering partner, O&L

Energy is also developing the first biogas plant in Namibia at the !Aimab

Superfarm in Mariental. This plant will be fully operational during the

second half of 2017.

Organic Energy Solutions − a subsidiary of O&L Energy − has established

a bush-to-energy business with the aim of harvesting invader bush

species in Namibia for the generation of sustainable energy for industrial

purposes. Organic Energy Solutions is a pioneer in bush-harvesting and

processing methods and during the year under review it commenced

the large-scale supply of woodchips to Namibia Breweries Limited for

its newly installed (first of its kind in Namibia) biomass boiler, with this

development being the single biggest contributor to O&L’s carbon

footprint-reduction achievements to date. One challenge has been

customer demand for a cleaner fuel product; for this reason we have

invested in mobile screening machinery that enables us to remove a

significant portion of the fine dust and sand previously collect along with

the Namibian encroacher bush material.

In FY18, the focus will be on volume growth by developing further

customers and/or applications for our encroacher bush product.

LEISUREO&L LEISURE (PROPRIETARY) LIMITED

The year under review was the first year in which all four properties making

up this portfolio were operational, with a combined total of 293 rooms

and the successful opening of the Chobe Water Villas being the highlight.

Trading during the first half of the financial year was exhilarating in most

of our customer segments, whilst trading in the second half of the year

was very subdued, with the domestic and regional segments performing

well below expectations as a result of the regional economic slowdown.

The Central European source market’s contribution also slowed down

during the second half of the financial year. This once again reveals the

impact of too much reliance on the seasonal Central European market

and demonstrates the need for ‘Destination Namibia’ to diversify its

source markets.

The boutique 16-room Chobe Water Villas is located at the eastern

tip of the famous Caprivi Strip, in the Zambezi Region of northeast

Namibia. This exclusive and intimate wildlife lodge opened for business

at the beginning of July 2016. The lodge is situated within the 150

km² Kasika Conservancy, in a secluded position directly on the banks

of the Chobe River and near to the town of Kasane in Botswana.

This siting affords visitors unobstructed views toward the world-

renowned Chobe National Park and the lodge also overlooks Kasikili

(Sedudu) Island, which boasts a phenomenal density of wildlife species:

elephant, lion, buffalo, hippo, crocodile, eight species of antelope and

over 460 species of birds.

The year under review also saw the following achievements:

- Total revenues have grown by 33.1% to N$187.4 million.

- Mokuti Etosha Lodge increased its occupancy from 59.5% in the

previous year to 63.4%, while also increasing its average room rate

from N$924 in FY16 to N$1 006.

This was brought about due to not only substantial demand for the

property, but also because of strategic anchor tenants expressing their

interest to extend for a further long-term period, as well as some vital

developments being planned for FY18. These developments will include

the expansion of the parkade as well as important changes to the retail

area making same more attractive and accessible.

Standard Bank Centre, which was unfortunately impacted by the decision

of Standard Bank Namibia to build their own head office and to exit the

Standard Bank Centre in 2019, had caused a negative year-on-year value

growth although a further extension of the Standard Bank Namibia lease

agreement was secured up to the end of 2019. Substantial changes are in

the planning stages for the upper retail area of Town Square, which over

the past years has seen significant challenges when it comes to retaining

retailers and ensuring strong foot traffic.

The completion of the 77 on Independence development during

November 2016 was a major milestone. With 164 residential units and

approximately 1,300 sqm of retail area, this development will contribute

significantly to the revitalization of the Windhoek CBD area. Transfer of

over 85% of the residential units was achieved by the end of the financial

year, while several high quality and value adding retail tenants have been

secured for the retail area. In addition to this, the critical link between

Independence Ave. and the Old Breweries complex was restored allowing

feet to pass through from either side in future. Although the residential

units will be sold by way of sectional title, the retail area will be retained.

WUM Properties (Pty) Ltd is currently a 60% owner of the retail area.

Year-on-year value growth for O&L’s core Investment Property Portfolio −

which includes Wernhil Park, Alexander Forbes House, and the Standard

Bank Centre – was just under 5% (2016: 14.6%), with operational earnings

before interest and tax (EBIT) increasing by 8% year-on-year.

ENERGYO&L ENERGY (PROPRIETARY) LIMITED

The strategic focus for O&L Energy continues to lie in project development,

project management, engineering, procurement, and construction.

Further core activities involve the operation and maintenance of:

- Medium- to large-scale solar power systems;

- Large-scale solar heating systems; and

- Bioenergy plants.

During the year under review, O&L Energy, together with its partner

Cronimet Mining Power Solutions, secured its first three solar power

projects on a ‘build-own-operate’ basis. The first contract was awarded by

the regional electricity distributer Erongo RED for a 3MW plant at Arandis,

which was constructed successfully and completed on schedule in June

2017. The second solar power plant is being developed in partnership

with the Okakarara Town Council, making this the first public-private

partnership in Namibia’s energy sector. O&L Energy was also awarded a

tender from the regional electricity distributer Cenored for a 5MW solar

power plant in Tsumeb. With these three projects − and several more

planned developments − O&L Energy has established itself as a leading

independent power producer in Namibia.

Within the O&L Group, in addition to the solar plant for NBL that has

been running successfully since 2013, O&L Energy will also implement

solar power plants for the Mokuti Etosha and Midgard Country Estate

lodges in the coming financial year. O&L Energy has also continued to

implement energy-saving solutions and energy-auditing activities across

O&L companies while expanding these services to customers outside the

O&L Group. We also continued with our Energy-Saving Lights Programme

for various clients.

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- Supporting and sustaining the current client base and recruiting new

clients;

- Maintaining and building a diversified Namibian supplier base; and

- Developing an inspirational working environment in which employees

can flourish and live their passion.

We are excited to embrace the future with innovative talent and a

passionate team that can attract new clients and create new opportunities

for us in developing fresh, strategic creative work that leaves lasting

impressions in the Namibian market.

ENGINEERINGKRAATZ MARINE (PROPRIETARY) LIMITED

The economic slowdown and tough market conditions have had a severe

impact on Kraatz Marine’s revenue and margin lines. Furthermore, low oil

and uranium prices affected 80% of our revenue stream. Revenue for the

financial period under review decreased from N$86.1 million in 2016 to

N$77.1 million in 2017. All indications are that steel supply into Namibia

has seen a reduction of about 40%; as a result, a strategic decision was

made to close Kraatz Steel in FY17 due to consistently low revenue

numbers over the past three years.

Reduction of costs and a relentless focus on sales and business

development, coupled with further diversification, are thus key to our

future growth prospects as well as to ensuring that Kraatz Marine gains

access to a floating dock.

Despite the challenging environment, our people, brand and long-lasting

client relationships have contributed to the further diversification of our

business into the heavy-mining equipment sector with the signing of our

important agreement with Hitachi Construction, through which Kraatz

became their Namibian agent. In addition to that, we have completed

another Syncrolift rehabilitation project and have experienced good

growth from the new uranium mine, Husab, while we also contributed to

the completion of the Group’s first large solar plant installation, at Arandis.

A challenge in our industry continues to be its dearth of skilled personnel.

To address this skills shortage, Kraatz is committed to developing young

talent through its apprenticeship programme with the Namibian Institute

of Mining and Technology (NIMT) and its engineering programme, through

the Namibia University of Science and Technology (NUST). Students from

both these institutions are hosted as interns at Kraatz, where they are

exposed to industry best practice. These endeavours are complemented

by the ‘Learn to Weld’ programme now offered by Kraatz.

Trading conditions in 2018 will no doubt remain tough but the business is

well positioned and confident that it is poised to capitalise on a number

of significant opportunities in times to come.

CENTRALIZED SERVICES O&L CENTRE

The O&L Centre comprises two divisions: O&L Corporate, which includes

the Group Leadership Team that leads group strategy, and the Centre of

Excellence, which renders specialist services to all operations in the O&L

Group.

These directly address the Group’s Vision Metrics and support the Group

Sustainability Agenda through:

- People strategy;

- CO2 savings;

- Corporate social investment (CSI) initiatives and spend; and

- Capital spend

Given the difficult economic climate, the O&L Centre managed to save on

budget and was in a position to hand a credit of N$10.5 million back to

the O&L operating companies.

The following are some of the highlights of the year under review:

- Centralising the Group employee relations function;

- Midgard Country Estate experienced a slight decrease in occupancy,

mainly due to reduced bookings from its primary conferencing

segment as a result of a decline in government and corporate activities

of this nature there: occupancies declined from 46.2% in the previous

year to 45.7%. This also resulted in a slight decrease in the average

room rate achieved, from N$782 to N$779.

- The Strand Hotel Swakopmund had its first full trading year in this

reporting period and had a steady occupancy rate compared against

the previous year (2016: 64.2%), while the average room rate increased

from N$1 439 in 2016 to N$1 546.

- Chobe Water Villas had a difficult first trading year, struggling to

penetrate the competitive high-end market in the Chobe destination

area, with occupancies well below those anticipated. Revenue for the

year was N$7.4 million and occupancy was at 23.7%.

- A highlight for the year in review in relation to our 2019 Strategic Focus

Areas: ‘Everyone purposefully producing breakthrough everywhere’

is the development of our pool of future leaders. This commitment

has been enhanced with the Talent Attraction Programme intakes, the

launch of the understudies’ development initiatives, and the signing of

memoranda of understanding for our internship programmes with the

University of Namibia (UNAM) and the Namibia University of Science

and Technology (NUST).

- In relation to our ‘Amazing experiences, enduring impact’ 2019 Strategic

Area of Focus, our hotel, lodges, and restaurants excelled in providing

our guests/customers with consistently high-quality experiences,

fostering amazing relationships and leaving a lasting impact to support

our vision of becoming Namibia’s ‘Most Loved Hotels and Lodges’.

- ‘Sustainable execution in everything’ (another 2019 Strategic Focus

Area) remains an integral part of our operational strategy, with

our aim to reduce our carbon footprint and enhance our operational

efficiency with the implementation of green initiatives. To this end, we

have concluded MoUs with O&L Energy to install solar power plants at

both Mokuti Etosha Lodge and Midgard Country Estate.

These achievements for the year ending 30 June 2017 and the positive

outlook on tourism in the country provide the foundation for O&L

Leisure’s journey towards FY19.

We are very confident that Namibia is set to become a better value-for-

money, safer, and more welcoming destination to international travellers

in the future and the outlook for the next trading year is very optimistic,

especially given the new direct airline routes coming into Namibia.

ADVERTISINGWEATHERMEN & CO (PROPRIETARY) LIMITED

With a foundation of solid and strategic creative work, and celebrating

four years in the business, Weathermen & Co has grown its portfolio

of established and new clients by winning a five-way pitch for the

premium advertising contract with the country’s leading mobile

telecommunications service provider, Mobile Telecommunications

Limited (MTC), as well as the account for First National Bank (FNB) and

other brands in the Rand Merchant Bank (RMB) stable. Although these

new wins did not translate into financial gains in FY17, they are anticipated

to have a significant financial impact on the business in FY18.

The overall economic climate has had a direct impact on our revenue

and profitability as clients cut down on general budget spent and in

particular reduce their spending on the marketing segment, which plays

a crucial role in any business. Despite these challenges, our talented and

passionate team − supported by a strong imaginative culture as well as

a pool of great clients and shareholders − contributed to the cementing

of Weathermen & Co’s solid reputation nationally. We remain committed

to making a significant contribution to, and impact on, the following

strategic focus areas:

- Elevating the creative product and improving client services by

attracting talented staff;

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- Initiating a Group-wide waste management programme;

- Entrenching the Sustainability Index

- 20% carbon-footprint saving initiatives on track;

- Conceptualising and implementing the Facial Recognition Campaign

for O&L Leisure at the Namibia Tourism Expo;

- Cyber-security: launching our first ever Social Engineering Assessment

and Awareness campaign

- Significantly improving email security.

We are confident that the O&L Centre will continue to deliver value

throughout the Group by further centralising critical support functions

and delivering on FY18 breakthrough initiatives, as well as playing a

significant role in ensuring that O&L becomes ‘The most progressive and

inspiring company’ by 2019.

AVIATIONEROS AIR (PROPRIETARY) LIMITED

Eros Air (Proprietary) Limited was founded in 1978 and provided express

corporate transport and charter flights for medical and private purposes

until a tragic accident on the 29th of January 2016 that claimed the lives

of 3 pilots. Namibia Breweries Limited (NBL) – a subsidiary of the O&L

Group – has since purchased Eros Air’s second aircraft and donated it to

the Intelligence Support Against Poaching (ISAP) in support of the fight

against rhino poaching. Although the Eros Air hangar is currently leased

out, the operation itself is dormant.

ASSOCIATE & JOINT VENTUREBRANDTRIBE (PROPRIETARY) LIMITED

The Brandtribe joint venture had a difficult year, with revenues declining

by N$1.3 million against 2016 levels. This was driven by the decline in

SMS gateway revenue in Namibia. During the year under review there

was significant focus on the future of the Brandtribe platform and we

invested N$600 K in 2017 to create a new ‘Insights’ platform, which will

form part of the overall Brandtribe platform offering in FY18.

When we completed development of the Insights platform, we tested

its viability as a standalone offering in the marketplace. The test market

was reasonably successful; however, we did not achieve the results that

would justify full commercialisation just yet. Despite this we learned

two valuable lessons about the creation of an e-commerce site that can

accept payments from anywhere in the world: using large test markets

like Nigeria and Egypt can provide quick and robust feedback, and small

changes to the user experience can dramatically increase adoption rates.

In South Africa, the date for the Protection of Personal Information Act,

No 4 of 2013 (POPI Act) to come into force is likely to be December 2017,

which means that organisations will have to be compliant by late 2018.

This legal development will play to the strengths of Brandtribe’s products

as they were designed to comply with the equivalent European laws

from their inception. During the year ahead we will focus on improving

the Brandtribe joint venture; integrating the Insights platform into

Brandtribe’s operations; and further developing Insight’s capabilities.

DIMENSION DATA NAMIBIA (PROPRIETARY) LIMITED

In the past year, Dimension Data Namibia contributed to the group with a

profit of N$5.3 million - phenomenal growth from the prior financial year.

Some of our achievements include:

- Celebrating our 10th year;

- International recognition by being awarded with the PMR Arrow award,

for our contribution to the Namibian economy.

- Our staff selected to serve on the executive board of Internet Exchange

Point (IXP) in Namibia.

- We continued to make inroads by restructuring our operations to

ensure a higher level of service delivery.

With tougher trading conditions we maintained our commitment to

enroll 6 students in the XT program and delivered exceptional financial

results to ensure meeting our shareholder expectations.

UNCHARTERED OCEANS

NOURISHING POTENTIAL

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Alternate Trustee of Namibia Business School; and Trustee of the O&L

Pension Fund.

Gideon ML Shilongo, Namibian (1964).

Group Corporate Affairs Director (since 9 July 2014).

Qualifications: Advanced Diploma in Business Administration Professional

Membership: MABE, MCIM, FSBP, ACIBM.

Director of various O&L companies within the Group; Director of Offshore

Development Company (Pty) Ltd; Director of Wilderness Safaris Namibia

(Pty) Ltd; and a board member of the Namibia Competition Commission,

Team Namibia, and the Namibia Trade Forum.

Patricia Hoeksema, Namibian (1974).

Executive Director (Alt. to S Thieme) (since 1 October 2015).

Joined the O&L Group in October 2004 as Corporate Social Investment

Manager at Namibia Breweries Limited. Moved to the O&L Centre in July

2013 as Group Corporate Relations Manager.

Qualifications: Bachelor of Economics Degree from the University of

Namibia (majored in Economics and Management Science).

Fields of work experience include: research and marketing (1997 - 1998);

economics and planning (1999 - 2004); and corporate social investment

and public relations (2004 to date). Member of the Welwitschia School

Trust.

NON-EXECUTIVE DIRECTORS

Hans-Harald Müseler, Namibian (1949).

Appointed 2009 as an Alternate Director and then as a full Director as of

20 March 2014.

Qualifications: Chartered Accountant (Namibia), MBA (Stellenbosch), Post-

Graduate Diploma: Compliance and Board Governance (University of

Johannesburg).

Chairperson of the O&L Audit Committee; member of the audit

committees of Bidvest Namibia, Sanlam Namibia, and Capricorn Unit

Trust Management. He is a Trustee of the Benchmark Retirement Fund

(Chairperson) and an advisor to the Meat Board Audit Committee.

Ernst Ender, German (1945).

Appointed: 23 June 2008.

Joined the O&L Group in 1975 as Marketing Manager at Namibia Breweries

Limited, appointed to the Namibia Breweries Limited Board in 1983.

Qualifications: 2-year post-graduate commercial traineeship with AC

Toepfer International.

Director of various O&L companies within the Group and has over three

decades’ experience relating to marketing, sales and export.

Laura McLeod-Katjirua, Namibian (1959).

Appointed: 2 April 2012.

Qualifications: Diploma in Development Studies and Management

(Tanzania Uyole Agricultural College), Diploma in Basic Education (Zambia

University).

Regional Governor of Khomas Region; member of the National Heritage

Council of Namibia (NHCN); and a Director of SeaFlower (Fishcor).

Carl-Ludwig List, Namibian (1948).

Appointed: 27 February 1980.

Joined the O&L Group in 1972 in various positions including the Managing

Director (MD) of the then Corporate Headquarters of O&L.

Qualifications: Banking (1971 Germany).

Whilst the MD at the (then) O&L Group Corporate Headquarters he

implemented and monitored the strategic, HR, and information

management strategies for the Group; director of various O&L companies

within the Group.

PRINCIPLES OF CORPORATE GOVERNANCE The Directors of the O&L Group of Companies remain firm in their

commitment to maintaining the highest standards of corporate

governance, an obligation that they view as fundamental to discharging

their stewardship responsibilities satisfactorily. All the Group’s businesses

share in this commitment; the adoption of, and adherence to, sound

corporate governance policies represent a business imperative for the

Group.

Our Board strives to provide the right leadership, as well as the strategic

oversight and control environment to produce and sustain value delivery

to all its stakeholders. The Board continues to reflect a culture of

openness, accountability and integrity − reflected in its commitment to

best practices. The Group is proud of its ethical and transparent business

management, not only in following accepted corporate practices for

risk management but also in providing strong assurance to its own

shareholders, and other stakeholders, by living the Group’s ethics.

GOVERNANCE AND COMPLIANCE OVERVIEW The Board has continued to strive towards the highest standards of

best corporate governance and to further align the Company with the

principles and practices contained in the NamCode during the year under

review.

THE O&L BOARD OF DIRECTORS EXECUTIVE DIRECTORS

Sven Thieme, Namibian (1968).

Group Executive Chairman (since 17 April 2002).

Joined the O&L Group in 1998, elected as Chairman in 2002.

Qualifications: Chartered Accountant (Namibia).

Director of various O&L companies within the Group, Chairman of the

Werner List Trust, President of the NCCI (Namibia Chamber of Commerce

and Industry), Chairman of the WCC (Windhoek Country Club), Chairman

of NBC (Namibia Broadcasting Corporation), Member of the National

Planning Commission.

Peter Grüttemeyer, Namibian (1953).

Chief Executive Officer (since 1 October 2003).

Joined the O&L Group in 2003.

Qualifications: Chartered Accountant (Namibia).

Previously the Partner-in-Charge of Deloitte Namibia, Director of various

O&L companies within the Group, Chairman of NASRIA (National Specific

Risks Insurance Association) Trustee of the Goreangab Trust, Lloyd’s

representative in Namibia.

Günther Hanke, Namibian (1956).

Group Financial Director (since 16 November 2004).


Served as the Financial Director at Namibia Breweries

Limited (until 1996), and then rejoined the O&L Group on

16 November 2004.

Qualifications: BCom (Accounting) (University of Pretoria) and a registered

professional accountant (SA) with SAIPA.

He has held various senior executive positions over the past three

decades in the manufacturing, telecommunication and mining sector. He

has been a director of various O&L companies within the Group, and is

Chairman of Dimension Data Namibia.

Berthold Mukuahima, Namibian (1959).

Group Human Capital Director (since 1 May 2006).


Qualifications: BA (University of Fort Hare); Certificate in Industrial

Relations; MBA (Ohio University).

He has accumulated over three decades’ experience in strategic HR

management in the higher education, telecommunications, and private

sectors and is Trustee Chairman of HealthWorks (formerly, NABCOA);

CORPORATE GOVERNANCE

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Apart from the review of the Governance content, which was also

performed in the previous period, the Board has assessed the Corporate

Governance section within the context of the NamCode.

The way that the Board communicates with all stakeholders embodies

the principles of balanced reporting, comprehensibility, openness, and

valuing substance over form. The Board is aware of the importance

of communicating the Group’s activities to stakeholders in a balanced

and comprehensible manner and strives to present clearly any matters

material to a proper appreciation of the Group’s position.

The interests and concerns of the Group’s stakeholders are addressed by

communicating information as it becomes known.

BOARD MEETINGS AND ATTENDANCE Meetings held by the Board during the financial year under review, and

the concomitant attendance by members was as follows:

MEMBERS 19/7/2016 22/9/2016 4/4/2017

E Ender # A A

P Grüttemeyer A A A

G Hanke A A #

Rev. WS Hanse A A A

C-L List A A A

G Shilongo A A A

Gov. LV McLeod Katjirua A A A

B Mukuahima A A A

HH Müseler A A A

UM Stritter A A A

S Thieme A A A

P Hoeksema (Alt. to S Thieme) A A A

A - Attended # - Apologies

BUSINESS PERFORMANCE, ACCOUNTING AND AUDITING

GOVERNANCE STRUCTURE

Udo Manfred Stritter, Namibian (1939) (Vice-Chairman)

Appointed: 24 March 1994

Joined the O&L Group in 1971 as legal advisor and assistant to the late

Chairman, Werner List; has been a Director since 1994

Qualifications: Attorneys admission (University of South Africa)

A practicing attorney since 1969 and senior partner and sole owner

from 1970 to 1976 of Engling Stritter & Partners, focusing mainly on

commercial law; director of various O&L companies within the Group;

Executive Chairman and CEO of Namibia Estate Enterprises (Pty) Ltd and

Japonica Investments Nineteen (Pty) Ltd

Reverend Willem Hanse, Namibian (1965).

Appointed 2 April 2012.

Qualifications: Undergraduate from Academy (UNAM), Windhoek, 1988

(majored in History and Psychology) and Pastoral Training from R. R.

Wright Seminary, Johannesburg, 1995.

He has experience in: compliance, marketing and public relations

(1990 - 2003); was Special Assistant to the Prime Minister and Speaker

(2003 - 2010); he has also been presiding elder at various AME churches

since 2010; Director of O&L Holdings (Pty) Limited and Director of EPIA

Investment Holdings (Pty) Limited.

RESPONSIBILITIES OF THE BOARD

The overarching responsibility of the Board is to exercise stewardship

of the Group within a framework of prudent and effective controls that

enable risks to be assessed and managed. The Board is tasked with setting

the Group’s strategic aims; it reviews whether the necessary financial and

human resources are in place for it to meet its objectives; and it monitors

management performance. Regular business performance reports keep

the Board informed about major developments affecting the Group.

In terms of the Board Charter − reviewed on an annual basis − the Board

has the overall authority for the conduct of the Group’s business. There

are also a number of matters that have been specifically reserved for the

Board’s consideration, which include the following:

- Approval of financial reporting and controls − such as interim and

annual results, the payment of dividends, and accounting policies;

- Monitoring the cash and capital resources of the Group, as well as its

overall liquidity, and authorising any significant acquisitions, disposals

of core businesses, investments, capital expenditure, or other material

projects or transactions;

- Monitoring and managing the relationships between the Group and its

regulators;

- Reviewing and implementing effective systems of delegation and

internal control, and carrying out an annual review of the effectiveness

of such systems;

- Identifying and continually reviewing key risks, as well as their mitigation

by management, against a background of economic, environmental

and social issues;

- Reviewing and approving the Group Strategy and the setting of long-

term objectives and/or changes in strategic direction;

- Monitoring the overall performance of the Group in relation to its

objectives, plans, and targets, as well as monitoring the implementation

of projects and decisions;

- Ensuring that the Company has an effective and independent Audit

Committee;

- Assuming responsibility for information technology (IT) governance;

- Confirming that the risk-based internal audit function is effective;

- Monitoring how stakeholders’ perceptions affect the Group’s

reputation; and

- Verifying the integrity of the Group’s Integrated Annual Report.

The Board is aware that in the period under review, independent

assurance was obtained on this Integrated Annual Report.

BOARD GOVERNANCE STRUCTURE Board Committees

AuditCommittee

RiskCommittee

Remuneration Committee

Board of Directors

Shareholders

Secretary

MANAGEMENTGOVERNANCE STRUCTURE

Group Leadership Team (GLT) - meeting at least monthlyComprising of all Executive Directors of the holding company

and key senior management

Group Executive (GE) - meeting 10-12 times a yearComprising of all Managing Directors of the

operating companies and GLT

Top Leadership Team (TLT) - meeting 2-3 times a yearComprising of GE and Senior Managers

OPERATIONAL MANAGEMENT GOVERNANCE STRUCTURE

AT EACH OPERATING COMPANY

Business Performance review meetingsFull, in-depth business performance review meetings are held quarterly, with shorter

performance update meetings being held in the other months. (GLT with SLT)

Senior Leadership Team (SLT) - meeting weekly or monthly as the need may be

(Comprising of Head of Departments)

Middle Leadership Team (MLT) - meeting weekly or monthly as the need may be(Comprising of senior management within

the various departments)

Group Operational

Meetings

(Held twice a year)

(Full review of operations)

(Attended by GLT & SLT)

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internal audit is an independent appraisal and assurance function that

is central to the Group’s governance structures. Its primary purpose is

to examine and evaluate the appropriateness and effectiveness of the

internal control systems applicable to the operational activities of the

business units within the Group. The Group utilises the independent

professional services firm EY to provide outsourced internal audit

functionality, which is currently focussed on NBL.

The Audit Committee is responsible for overseeing the internal audit

function and approving the Internal Audit Plan. The Audit Committee

ensures that the Company’s internal audit function is independent and

has the necessary resources, budget, standing and authority within the

Company to enable it to discharge its functions.

An Internal Audit Charter is formally defined and approved by the

Board. The Head of Risk has direct access to the Chairman of the Audit

Committee.

The internal audit function’s key responsibilities include: evaluating

the Company’s governance processes (including ethics); undertaking

an objective assessment of the effectiveness of risk management and

the internal control framework; systematically analysing and evaluating

business processes and associated controls; and providing sources of

information, as appropriate, regarding instances of fraud, corruption,

unethical behaviour and irregularities.

The internal audit function reports to the Audit Committee at every

meeting and has the cooperation and support of both Board and

management.

Nothing has come to the attention of the Directors to indicate any

material breakdown in the functioning of these controls, procedures and

systems during the year under review.

BOARD COMMITTEES While the Board remains accountable to the Group and is responsible for

the Group’s performance and affairs, it delegates to management and

Board committees certain functions to assist it with properly discharging

these duties. Appropriate structures for such delegations are in place and

are accompanied by monitoring and reporting systems.

Each Board committee acts within agreed written terms of reference. The

chairperson of each Board committee is asked with delivering a report

at each scheduled Board meeting and minutes of Board committee

meetings are provided to the Board.

All Directors, as well as the chairperson of each Board committee, are

requested to attend AGMs to answer questions raised by shareholders.

The various Board subcommittees currently operating are set out

below. The current CEO is a member of the Audit and the Remuneration

subcommittees, as a consequence of the specific knowledge and

experience he possesses. Over time, however, these subcommittees will

be structured to exclude the CEO and to have majority Non-executive

Directors.

AUDIT COMMITTEE

During the financial year under review, the Audit Committee comprised

two Directors: one of them was an independent Non-executive Director

− Mr HH Müseler (Chairman) − while the other was an Executive Director,

being Mr P Grüttemeyer. The Group is currently working to recruit a

suitably qualified candidate for a vacant non-executive position on this

committee.

BUSINESS PERFORMANCE REVIEW MEETINGS

Monthly business performance review meetings are held with each

individual operation within the Group. Full, in-depth business performance

review meetings are held quarterly, with shorter performance update

meetings being held in the other months.

The purpose of the full business performance review meetings is to

conduct an in-depth review of a specific operation’s performance and

progress in disciplines such as finance, marketing, human capital, risk

management, corporate citizenship and responsibility, and IT. These

meetings are attended by the Group Leadership Team and the senior

leadership team of the operation in question. The purpose of the

performance update meetings is to focus on and discuss key issues

affecting the individual operation, as well as its financial results and

forecasts. These meetings are attended by the chairperson, the managing

director and the financial director/manager of each individual operation.

GROUP OPERATIONAL MEETINGS

The purpose of these meetings is to review and evaluate the Group’s

centralised functions’ performance and progress in disciplines such

as finance, marketing, human capital, risk management, corporate

citizenship responsibility, and IT. The meetings provide a platform

for identifying opportunities and synergies within the Group and for

discussing issues requiring the Group’s attention. These meetings, which

are held twice a year, are attended by the Group Leadership Team, senior

managers of the centralised functions, and the managing directors and

financial directors/ managers of the OpCos.

AUDIT AND RISK COMMITTEES ACCOUNTING, AUDITING AND REPORTING

This 2017 Integrated Annual Report focuses on material developments

and issues and provides pertinent, related performance indicators. We

define a material development or issue as one that affects our ability to

remain commercially viable and socially relevant to the communities in

which we operate.

The Board places strong emphasis on achieving the highest standards of

financial management, accounting, and reporting to our stakeholders. The

Directors are responsible for preparing the Annual Financial Statements

(and other information presented as part of these statements) in a

manner that fairly presents the state of affairs, the results of operations,

and the cash flows of the Group in the year under review.

The external auditors are responsible for carrying out an independent

examination of the Annual Financial Statements in accordance with

the International Standards on Auditing (IASs). The external auditors

also declare whether or not the Annual Financial Statements are fairly

presented and whether or not they comply with International Financial

Reporting Standards (IFRSs). Our lead audit partner from Deloitte changed

during 2017, thus ensuring continued independence.

The Group’s own Audit Committee evaluates the independence and

effectiveness of the external auditors and considers whether any non-

audit services rendered by such auditors substantially impair their

independence. If this is found to be the case, appropriate corrective

action is taken with regard to those services.

INTERNAL AUDIT AND CONTROL

The Group’s internal controls are designed and operated to support the

identification, evaluation, and management of risks affecting the Group,

as well as the business environment in which it operates.

Internal control systems provide management and the Board with

reasonable assurance as to the integrity and reliability of financial

statements. Responsibility for the adequacy and operation of the

systems is delegated to the Executive Directors. The records and systems

are designed to safeguard assets and to prevent and detect fraud. The

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In appointing members to the Risk Committee, a potential candidate’s

education and/or business experience within the committee’s scope of

activities are taken into account. The Risk Committee is a subcommittee of

the Audit Committee and gives feedback at Audit Committee meetings.

Whilst the membership of the Risk Committee would normally comprise

Non-executive Directors, in its current form the membership is made

up of the persons listed above. The Audit Committee achieves oversight

of the Risk Committee by means of the Chairmanship being fulfilled by

the CEO (who is also a member of the Audit Committee) as well as the

(optional) attendance of H Müseler, the Chairman of the Audit Committee,

who is an independent Non-executive Director and that of the internal

auditors, EY. The Risk Committee met twice in the last financial year.

REMUNERATION COMMITTEE

The Remuneration Committee consists of two members: C Swart-

Opperman (Dr) (Chair, (appointed 19 July 2016)) and Mr P Grüttemeyer

(CEO) and its responsibility is to review the remuneration of the Group’s

executive leadership, as well as performance bonuses and Directors’ fees.

The remuneration of senior executives is based on their performance

within their area of responsibility and is calculated using key indicators

of operational and financial performance, among other factors. The

Board’s remuneration philosophy dictates that rewards to executives

are balanced against the interests of the Group and its shareholders.

The Remuneration Committee is also empowered by the Board to set

the short- and long-term remuneration of Executive Directors. More

generally, the committee is responsible for the assessment and approval

of a broad remuneration strategy for the Group, which is documented

in the Remuneration Policy and the committee is at liberty to solicit the

assistance of outside consultants with specialised skills and expertise

to formulate and maintain an equitable compensation structure.

The committee’s Terms of Reference are set out in a Remuneration

Committee Charter.

There was one Remuneration Committee meeting held during the period

under review:

MEMBERS 14/3/2017

C Swart-Opperman (Dr) A

P Grüttemeyer A

A - Attended

The Board appoints the members of the Remuneration Committee

by taking into consideration potential candidates’ education and/or

business experience within the committee’s scope of activities. Members

are appointed for a 3-year term, with the initial term for at least one

member being two years and for at least one other member being one

year.

The Remuneration Committee does not recommend disclosure of

individual Director’s fees. These fees of the executive Directors’ are paid

by subsidiaries and not by the holding company. For subsidiaries whose

shares are listed, the full Director’s remuneration was disclosed in the

respective integrated annual report of that listed subsidiary.

PROFESSIONAL ADVICE

All Directors have access to the advice and services of the Company

Secretary, who is responsible to the Board for ensuring compliance with

procedures, as well to applicable statutes and regulations. All Directors

also have full and timely access to all information that may be relevant to

the proper discharge of their duties and obligations, thus enabling the

Board to function effectively.

The Company Secretary ensures that Board charter and various terms

of reference are regularly reviewed and complied with and ensures that

all minutes are circulated to the relevant Directors. A Board evaluation

process has been adopted and implemented through the Directors’

Governance Policy.

The Audit Committee’s Terms of Reference are set out in the Audit

Committee Charter. The Audit Committee is mandated by the Board

to review the financial statements, the appropriateness of the Group’s

accounting and disclosure policies, its compliance with IFRSs, and the

effectiveness of internal controls. In keeping with this mandate, Deloitte

(Namibia) was re-appointed as the Group’s external auditors, while EY

fulfilled the role of internal auditor, as stated previously.

Both the external and internal auditors have unrestricted access to the

Audit Committee and attend all meetings to report on their findings and

to discuss matters relating to accounting; auditing; risk identification,

measurement and mitigation; internal controls; and financial reporting.

The Audit Committee ensures that a combined assurance model is

applied to provide a coordinated approach to all assurance activities.

The Audit Committee is tasked with satisfying itself as to the

appropriateness, expertise, and adequacy of resources of the finance

function and the experience of the senior members of management

responsible for the financial function. This is an evaluation that is

performed annually.

The Audit Committee is also responsible for overseeing the content

and disclosure of the Integrated Annual Report and has been tasked by

the Board to assist in overseeing the integrity of the Integrated Annual

Report. The Audit Committee has complied with its legal, regulatory or

other responsibilities and has recommended the 2017 Integrated Annual

Report to the Board for approval.

The Audit Committee meets at least twice a year − preferably before the

Board’s approval of the interim results and then again after the annual

external audit has been completed but prior to the Board’s approval of

the Annual Financial Statements.

Meetings held during the financial year under review and attendance by

Audit Committee members were as follows:

MEMBERS 21/9/2016 29/4/2017

P Grüttemeyer A A

HH Müseler A A

A - Attended

Appointments to the Audit Committee are made by the Board and

take into account a potential candidate’s education and/or business

experience within the Audit Committee’s scope of activities. Members

are appointed for a 3-year term, with the initial term for at least one

member being two years and for at least one other member being one

year.

RISK COMMITTEE (A COMMITTEE OF THE AUDIT COMMITTEE)

The purpose of the Risk Committee is to assist the Board of Directors

in fulfilling its oversight responsibilities with regard to the risks inherent

in the Group’s business, as well as the control processes with respect to

such risks; the assessment and review of credit, market, fiduciary, liquidity,

reputational, operational, fraud, strategic, technology, data-security and

business-continuity risks; and the monitoring of the Group’s overall risk

profile, including significant risks faced by individual companies within

the Group as well as by the Group as a whole.

Membership comprises people in the following roles:

- Executive Chairperson;

- Chief Executive Officer (Chairperson of the Risk Committee);

- Group Financial Director;

- Group Human Capital Director;

- Head: Group Risk Management;

- Chairpersons of OpCos’ risk committees; and

- Company Secretary.

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Board nominations are considered through the Remuneration

Committee and recommendations on appointments are made to the

Board for adoption.

CONFLICTS OF INTEREST

At every Board, Board committee, and management meeting of the O&L

group, the chairperson of that specific meeting asks all members and

attendees to disclose any possible conflict(s) of interest in respect to

any of the business to be discussed. Furthermore, this requirement is a

standing agenda item at every meeting.

Once a year, the Company Secretary forwards a Conflict of Interest

Declaration Form to all the Directors for completion, as required in terms

of sections 237 to 248 of the Namibian Companies Act 28 of 2004. The

completed forms are then filed. The Directors are aware that should

there be any change or addition to any information detailed in their

declarations of private interest, they are required to notify the Company

Secretary within 30 days of such change or addition occurring.

COMPLIANCE WITH LAWS, RULES, CODES AND STANDARDS

The Board acknowledges its responsibility in ensuring that the Group is

compliant with all relevant laws, rules, codes and standards. The Board has

ensured that an effective Compliance Framework has been established

and implemented. This Compliance Framework is designed in such a

way that the relevant laws, rules, codes and standards are identified;

compliance monitored; and any instances of non-compliance rectified.

The compliance function has been delegated to each OpCo, while

the Audit Committee − through the Group’s Risk Committee − has an

assurance programme in place to confirm that compliance to relevant

laws, rules, codes and standards is applied within each individual business.

During the reporting period, no fines or sanctions, which are deemed

material by the Board, for non-compliance with laws and regulations

were initiated against the Group and no legal action for anti-competitive

behaviour was instigated.

RISK MANAGEMENT PRACTICES

The Board is ultimately responsible for managing the Group’s risk and

setting its risk appetite. The Risk Management System is designed to

manage (rather than eliminate) the risk of failure in order to achieve

business objectives. The system includes having ongoing processes in

place to identify, assess, manage, monitor, and report on the significant

risks faced by individual companies within the Group as well as by the

Group as a whole.

A Risk and Opportunity Assessment is conducted on an annual basis at

the OpCos to ensure that management remains aware of these issues

throughout the Group. The assessment process identifies the critical

business, operational, financial and compliance exposures facing the

individual operation, as well as the adequacy and effectiveness of control

factors at all levels.

Materiality levels are set for each business-unit level and vary according

to the nature, scope and size of the business concerned. In setting these

levels, due consideration is given not only to financial impact(s) but also

to the potential threat to the integrity of the business as a going concern,

its reputation, and the wellbeing of employees and other stakeholders.

Each OpCo in the Group has its own risk committee that identifies major

risks from the risk assessments outlined above and ranks these on a

risk matrix. The Group has a formal risk management process, which is

documented in the Group’s Risk Management Policy. The Group’s risk

matrix is collated from the risk matrices of the individual OpCos.

The Group risk matrix is used as a tool to assist management in recognising

all material risks to which the Group is exposed and ensuring that the

required risk management culture, practices, policies, resources and

systems are progressively implemented and function effectively. The risk

committees of the various OpCos report to the Group’s Risk Committee.

The systematic risk assessment process ensures that risks, opportunities,

and risk controls are not only adequately identified, evaluated, and

managed at the appropriate level in each OpCo but also that their impact

on the Group as a whole is taken into consideration. In the period under

review the Group did not expose itself to any undue, unexpected, or

unusual risks that caused it to suffer material losses.

The Board of Directors is of the opinion that the risk matrix is an

appropriate tool for risk identification and assessment. The matrix is

very detailed and specific; it is therefore not disclosed in this Integrated

Annual Report in order to ensure that no confidential information − and

thus undue advantage − is provided to our competitors.

During the reporting period, the Group continued to utilise the BarnOwl

risk management software throughout the Group, thus ensuring that a

unified and structured risk-management approach is applied across the

Group, as well as entrenching the risk management framework.

The Group recognizes the current poor trading conditions both

within Namibia and across the SADC region and the situation is being

monitored on a continuous basis to ensure that all potential risks and

opportunities that present themselves are adequately evaluated and that

the appropriate corrective management measures are taken. The Group

also remains aware of the long-term water-security challenges faced

by Namibia (and the central highlands in particular) and has identified

adequate mitigation responses to address associated risks.

The Group has entrenched its anti-corruption policies and procedures

during the reporting period through its Annual Declaration Programme,

communication of its Code of Ethics, and the implementation of a

commercial crime audit at all of its OpCos.

The Group has adopted a zero-tolerance stance on fraud and regrets

to report that one incident of fraud has been investigated at one of its

subsidiaries during the reporting period. The loss caused by this incident

was not, however, material. This incident has been reported to the

relevant authorities for further investigation.

SUCCESSION PLANNING

The Group benefits from having an extensive pool of people with diverse

experience and high levels of competence at senior management level

and as a result the Board is confident that it is able to identify suitable

short- and long-term replacements from within the Group when the

need arises.

The Group has an established Talent on the Move Programme, through

which information regarding forthcoming Company vacancies in key

positions is widely disseminated internally − thus taking succession

planning to the next level. Employees are encouraged to submit their

names for consideration through the programme so that their capacities

can be developed to fill these positions once they become available. Two

objectives are aimed at here: employees take charge of their own career

development, and the Company has a database of talented individuals

who are ready to move into higher positions when the opportunity arises.

GOVERNANCE OF INFORMATION TECHNOLOGY

The Board, assisted by the Risk and Audit committees, is responsible for

the governance of information technology (IT) across the entire Group.

The Board recognises that IT is essential to managing the transactions,

information, and knowledge necessary to initiate and sustain the Company.

The Board has adopted and implemented an IT Control Framework. The

external auditors provide assurance on the IT Control Framework when

conducting their annual audit. During 2016 and 2017, this external review

did not result in any significant or material findings.

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The Board is aware that the Group’s IT strategy must be integrated within

the Company’s strategic and business processes as a matter of priority.

Although the Board is ultimately responsible for the IT governance

framework, it delegates the responsibility for implementation to

management. There is an appointed Manager: Group Information

Systems who is responsible for the management of IT; the Board is

confident that the Manager: Group Information Systems is a suitably

qualified and experienced person who has been primarily appointed to

act as a bridge between IT and the business. The Group’s IT Strategy Plan

is reviewed and signed by the Ohlthaver & List CEO, Mr Peter Gruttemeyer.

The IT Strategy Plan is maintained on the O&L Process Model.

The Board is further responsible for the monitoring and evaluation of

the investment and expenditures incurred for IT by the Group, so that

it can ensure that the Company acquires and uses the appropriate

technology, processes and people to support its business and governance

requirements in a timely and relevant manner. At this stage, the bi-

annual Group Operational Meetings (GOM) (and to a lesser extend the

monthly Business Performance Review’s (BPR’s)) are used as forum for

the IT Steering committee. All significant IT initiatives are presented and

reviewed at the GOM and/or Centre of Excellence BPR’s, or, if needed due

to the investment involved, at Board level.

Information technology risks fall under the Group’s risk management

activities and considerations. The Board recognises that IT legal risk

arises not simply from the possession, ownership, and operational use

of technology but also from the possibility that there may be misuse

(inappropriate or negligent use) of the technology − which might directly

lead to the Company becoming a party to legal proceedings. Furthermore,

the Group is aware of the need for compliance with applicable laws, rules,

codes and standards that are affected by IT and the Board therefore

ensures that these IT-related laws, rules, codes and standards are identified,

with the objective of ensuring adherence to them.

The Board, through various processes, ensures that the information

generated and stored by its IT system is kept secure, private, and

confidential and that it is also available to permitted users in a timely

manner and in a suitable format.

These processes are implemented, documented and maintained on the

Process Model. The Process Model includes the following:

- Business continuity;

- Change control;

- Acceptable IT policies and procedures;

- Security policies and procedures; and

- IT security standards.

Moreover, various other measures have been put in place to safeguard

the Group’s IT environment, including the following:

- Cyber-security assessments and awareness campaigns; and

- Annual IT controls audits by external auditors.

Information records are the most important information assets as they

are evidence of business activities. Information management and privacy

& security are of crucial importance, and the Group is thus evaluating the

implementation of a “Data Loss Prevention Solution” as presented at a

recent Group Risk Meeting

DISPUTE RESOLUTION

The Board recognises the importance of resolving disputes with all

stakeholders as effectively, efficiently and expeditiously as possible and

to this end it has implemented a Dispute Resolution Methodology. This

methodology stipulates that conflict and dispute resolution are dealt

with through constructive dialogue with the relevant parties in the first

instance. Where this preferred method does not result in adequate

resolution of the matter, external legal advisers, mediators and/or

arbitrators are engaged to expedite resolution. For labour disputes

specifically, the Directors make use of the Labour Act No. 11, of 2007

− which has a provision for alternative dispute resolution that is distinct

from the Compulsory Dispute Resolution Mechanism channelled through

the office of the Labour Commissioner.

SWELTERING SUNLIGHT

LIM

ITLE

SS

ENER

GY

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SOCIAL SUSTAINABILITYHUMAN CAPITAL

Employment Equity

The O&L Group of Companies subscribes to the principle of equal

opportunities for all; thus it gives preference to Namibian citizens when

filling vacant positions across the Group. Furthermore, the Group strongly

supports the Affirmative Action (Employment) Act, 1998 (No. 29 of 1998),

and duly files the required Affirmative Action Report with the Office of the

Employment Equity Commission on an annual basis.

The above table indicates that as at 30 June 2017, 86 % of senior

management and Executive Directors are Namibian citizens who have

been hired from within the country.

The number of non-Namibians employed increased from 62 to 65 during

the reporting period, mostly as a result of recruitment within the leisure

division, where the Company relies to an extent on expatriates with skills

in hotel management. Employment of those who are classified as disabled

increased from 7 (2016) to 11. There was no significant change in the

total employee complement for the period under review compared to the

previous period.

JOB CATEGORY RACIALLY RACIALLY PERSONS WITH NON-NAMIBIANS TOTAL

DISADVANTAGED ADVANTAGED DIABILITIES

Men Women Men Women Men Women Men Women Men Women

Executive Directors 5 0 13 1 0 0 1 0 19 1

Senior Management 22 7 38 16 0 0 13 3 73 26

Middle Management 193 134 96 50 0 0 27 8 316 192

Specialised/skilled/senior supervisory 306 338 27 18 3 0 5 4 341 360

Skilled 632 299 5 8 2 1 0 1 639 309

Semi-skilled 1089 1176 0 0 2 1 0 0 1091 1177

Unskilled 302 495 0 0 1 0 0 0 303 495

Total permanent 2549 2449 179 93 8 2 46 16 2782 2560

Fix terms/Temporary 435 300 8 2 0 1 3 0 446 303

Total 2984 2749 187 95 8 3 49 16 3228 2863

WORKFORCE PROFILE AS AT 30 JUNE 2017

RISKS FROM CLIMATE CHANGEOhlthaver & List continues to note with concern the accruing evidence of

the escalating threat that climate change poses to our operations in our

highly arid country, as well as to the rest of the world.

The nationwide drought that has blighted the past two years is of

particular concern and the Group believes that such extreme climate

events will continue into the future. As water is one of our Group’s most

material issues, the rising costs of this scarce resource are set to pose an

ongoing financial challenge to operations − especially in view of the water

shortage in especially Windhoek that continued with supplies at critical

levels during the reporting period. The local authority announced a 20%

increase in water tariffs for the Windhoek area for the new financial year.

Due to Namibia’s arid landscape and its legislation against the use of

genetically-modified crops (GMOs) as animal feed, the Group continuously

has concerns relating to the future cost of feed for our dairy cows and

the price of barley as a raw material for some of our processes in coming

years. Importing these raw materials from overseas markets is a costly

endeavour. As a material issue for the Group, the cost of doing business

is therefore a risk that could increase greatly with climate change.

The Group is attempting to manage this through long-term purchase

agreements with fixed pricing and by ongoing supplier performance

evaluation, as well as by growing our own animal feed and constantly

monitoring the prices and costings to our dairies.

LOCAL HIRING AND PROCUREMENTThe O&L Group is committed to contributing to communities by,

among other things, hiring and procuring locally wherever possible. We

therefore continue to give preference to Namibian businesses and small-

and medium-scale enterprises whenever it is possible for us to do so.

During the year under review, local procurement (“procure to pay

process”) spending constituted almost 53% of all our spending on

goods and services, compared to 48% and 50% during the previous two

reporting periods (2015 and 2016, respectively). The majority of imported

commodities comprised barley malt and hops for the brewing industry,

as well as packaging material that cannot be purchased locally for the

brewing and dairy industries.

The uncertain political − and consequently economic − environment in

South Africa, where the majority of packaging materials are procured,

remains a material issue. The risk of industrial action in the packaging

material and transport and allied sectors has eased over the last year,

however, and the depressed regional economy has allowed for more

favourable packaging-material prices.

ECONOMIC, SOCIAL AND ENVIRONMENTAL SUSTAINABILITY

LOCAL PROCUREMENT SPENDING AS % OF TOTAL SPEND

2013/ 2014/ 2015/ 2016/ 2014 2015 2016 2017

Namibia Breweries Ltd 33.5 35.3 38.9 40.6

O&L Centre 59.9 46.7 49.8 53.8

Weathermen & Co 85.0 88.6 88.2 93.2

O&L Organic 75.1

O&L Energy 94.6 100.0 61.7 97.9

O&L Leisure − − − 95.0

Namibia Dairies 52.5 54.4 54.3 58.5

Hangana Seafood 88.8 87.8 83.1 86.5

Model Pick n Pay 80.2 80.1 83.6 83.6

Kraatz Marine 91.0 94.3 94.4 96.7

Total 44.9 47.6 49.7 52.9

SUSTAINABILITY

70

SUSTAINABILITY

71

The Talent on the Move Programme that was launched by the Group

aims to address succession management for key positions in order to

accelerate the development of employees who exhibit potential in their

specific lines of work and who are willing to put themselves forward for

capacity-building and other training.

The Group recognizes that for some specialised roles, competent

incumbents from designated groups may only be available in the long

term, but we nonetheless undertake to ensure that there will be a learning

path to achieving this goal.

In accordance with the Affirmative Action (Employment) Act, the Group will

facilitate the mentoring and development of every Namibian employed as

an understudy to a non-Namibian, should it be necessary to do so. The

understudy employees are also part of the Talent on the Move Programme.

Remuneration

The Group’s Remuneration Policy makes provision for the following

benefits:

- Pension (employee 7% and employer 11% contributions): all grades,

- Medical Aid (50% Company contribution): all grades voluntarily,

- Transport Allowance: grades 1 - 7A,

- Funeral Scheme: all grades,

- Acting Allowance: grades 1 - 7B,

- Car Allowance, Housing Allowance: employees remunerated on a cost-

to-company (CTC) basis

- Incentive Bonus: grades 6A - 9,

- Annual Bonus (13th cheque): grades 1 – 5,

- Annual bonus based on performance: grades 6 - 9,

- Purchases Discount: all grades.

Temporary employees qualify for the subsidised Transport Allowance, 13th

cheque, Productivity Bonus (where applicable), Funeral Scheme, Vitality

HIV/AIDS cover, and Purchases Discount at our retail subsidiaries.

The Group operates across a very wide range of sectors; in the absence of a

Namibian minimum wage it is difficult to make meaningful comparisons of

wages against national pay scales since workers to whom minimum wages

currently apply are limited. At sector level, however, the O&L remuneration

philosophy is to position wages at market midpoint (50th percentile) and

the Group is confident that its average minimum remuneration remains

on par with sector benchmarks.

Employee relations

In the year under review, 61.1% of employees below supervisory and

management grades were covered by collective bargaining agreements

concluded at OpCo level.

Retrenchments, transfers, and organisational changes are all done in

accordance with contracts of employment and no employee is given less

than one month’s notice of any such change relating to their working

conditions.

All employees are subject to the Health and Safety Policy of the Company

- this is a legal requirement and therefore non- negotiable.

There have been no incidents of discrimination, no infringements in terms

of freedom of association or collective bargaining, and no instances of

child or forced labour during the reporting period. No operations were

subject to human rights reviews or impact assessments.

No collective grievances were filed by employees for the period under

review.

Employment Equity Comparison

The table below is a comparison of Racially Disadvantaged employees for

the periods 2017 vs 2016.

LEVEL IN EMPLOYEE HIERARCHY AND GRADE RACIALLY DISADVANTAGED

2016 Variance 2017

Job Category Men Women Men Women Men Women

Executive Directors (Grade 9) 5 0 0 0 5 0

Senior management (grades 8A - 8C) 24 12 -2 -5 22 7

Middle management (grades 7A - 7C) 209 151 -16 -17 193 134

Specialised/skilled/senior supervisory (grades 6A - 6B) 370 350 -64 -12 306 338

Skilled (Grade 5) 431 229 201 70 632 299

Semi-skilled (grades 2 - 4) 1187 1161 -98 15 1089 1176

Unskilled (Grade 1) 246 459 56 36 302 495

Total permanent 2472 2362 77 87 2549 2449

Fix terms/temporary 556 346 -121 -46 435 300

Total 3028 2708 -44 41 2984 2749

The Group recorded a net decrease of 116 previously disadvantaged men

and women in employment in total across the categories of specialised/

skilled/senior supervisory, middle management, and senior management

positions. The reduction at these levels will be addressed during the

next financial year with targeted interventions to ensure that the Group

meets its objective of being an employer of choice by 2019 in terms of

employment equity.

The O&L Group aims to create a feasible and flexible strategy that addresses

work-related employment barriers and the expectations of employees

in designated groups, namely the racially disadvantaged, women, and

persons with disabilities.

At the same time, the Group recognizes the shortage of skills in Namibia

as well as the ambitions and aspirations of current and future non-

designated employees. Therefore in implementing its Affirmative Action

Plan, the Group will not unfairly discriminate against any employee who

does not belong to a designated group as defined in the Affirmative

Action (Employment) Act (Act 29 of 1998). The Group’s Affirmative Action

Plan ensures that equity is achieved within the organisation in line with this

plan’s objectives.

SUSTAINABILITY

72

SUSTAINABILITY

73

Employee Turnover

O&L measures and monitors employee turnover on a quarterly basis;

the Group also conducts exit interviews with all employees who leave

the Group. The objective of exit interviews is to understand employees’

motivations for leaving and, if possible, implement remedial measures

where necessary to reduce further loss of personnel. This process gives

the Company an opportunity to make meaningful evaluations in terms

of a particular job or work position, the personnel, and its OpCos. It also

enables the Group to understand how best to ensure job satisfaction in

the future and retain employees. A total of 842 employees (compared to

1,016 employees in the previous year) exited the Group. The graph below

indicates the various employee turnover categories.

The total employee turnover rate for the Group in FY17 amounts to

13.6% (compared to 15.9% and 16.3% for the 2015 and 2016 reporting

periods respectively). This rate is based on the permanent employees on

the Group’s payroll at the end of the financial year. The Group regards this

as a reasonable turnover rate given the fact that it covers all categories

of job terminations.

Turnover figures for the reporting period are dominated by resignations

(at 52%) and dismissals (at 34%), with the highest turnover being

experienced in the retail and information technology sectors. Reasons

given for resignation were mostly related to employees taking up

better job offers or leaving to further their career or studies. There

were 48 voluntary redundancies during the period under review. These

redundancies arose primarily from the closure for refurbishment of the

Otjiwarongo Model Pick n Pay store. Once this store reopens, preference

will be given to these employees for re-employment.

TALENT, LEARNING AND DEVELOPMENT

Leadership and Employee Development

O&L World

O&L World is a 3-day leadership development programme hosted every

month for all employees of the Company, as well as external participants.

At this event the O&L culture, Purpose, Vision, Values and breakthrough

thinking are embedded by the Chairman and the Human Capital Director.

The plan is to cover all 6,000+ employees by the end of 2019.

Breakthrough Management Skills and the Leadership Foundation

Programme

Breakthrough Management Skills and the Leadership Foundation

Programme are two leadership initiatives aimed at building a breakthrough

culture and equipping attendees with the management and leadership

skills that they require to operate to their full potential within the Group.

Fifty-one leaders attended Breakthrough Management Skills training

during the year under review. Ninety-two employees received their

completion certificates from the Leadership Foundation Programme.

Talent Attraction Programme

The Talent Attraction Programme focuses on attracting and retaining

dynamic Namibian graduates from local and international universities and

technicons who display the passion and potential to be developed into the

future leaders of the O&L Group of Companies.

This year the programme celebrated its 10th anniversary and over the past

decade it has emerged as one of the O&L Group’s great success stories,

with this reporting year seeing its highest intake (13 graduates in various

fields) since it began. The Talent Attraction Programme has had a retention

rate of 61% since its inception in 2008, with various graduates from this

programme currently in senior leadership positions across the O&L Group

of Companies.

Hangana Seafood

Hangana ensures improved performance and world-class quality in

the fishing Industry through regular quality-assurance and food-safety

training events. The company focused on generic training, quality

assurance training, production management programmes, and statutory

training in the year under review. Total Production Management Training

is a key focus area and aims to eliminate waste and improve efficiencies

and productivity.

Hangana also hosted internships and job attachments for students

studying in various fields during the year under review.

Dimension Data

Dimension Data continues to gain momentum in developing young

talent in the Information Technology Industry for Namibia. A total of 25

employees participated in different upskilling training throughout the

reporting period, in fields of IT and Administration.

Dimension Data Namibia has taken in 6 new students from the racially

disadvantaged group. The students are enrolled into the fulltime

program for which Dimension Data Namibia carries the cost. Dimension

Data Namibia also took in 5 external interns who are in the process of

completing their certification in IT at the Namibian University of Science &

Technology (NUST).

The company increased its efforts in training and development, as to

ensure that all employees can be integrated as qualified professionals into

the Namibian IT sector, however a strong effort has been made to upskill

potential candidates from outside the company, which will benefit the

Namibian IT sector in the long term.

REDUNDANCIES 48

RETIRED 34

RESIGNED 439

DISMISSAL 291

OTHER (Contract Ended/Deceased/Disabled/Retired) 30

EMPLOYEE TURNOVER 2016/17

SUSTAINABILITY

74

SUSTAINABILITY

75

The Group spent N$ 12.65 million on training interventions during the

reporting period, which is 1.29% of total payroll compared with 1.14% in

the previous period (with the benchmark set at 1%).

EMPLOYEE ENGAGEMENT

At the time of the launch of the Mwenyopaleka Programme in 2004, the

unique ‘company culture’ of the O&L Group of companies was born, with

the main objective of the programme being to instil the Group’s Purpose,

Values and Vision (as well as the associated behaviours) in the hearts and

minds of all employees within the Group. The Mwenyopaleka Programme

has therefore allowed the Group to promote and communicate these

objectives to a large number of its employees over the 13 years since it

was launched.

More recently, in 2013 the employee engagement function was established

as part of our Vision 2019 communication strategy − which continues to

empower our people by developing their personal connection to our

Purpose, Values and Vision; leveraging the corporate brand by building

a sense of belonging and ambassadorship in employees; and creating a

breakthrough environment for all those who work for the Group.

The Employee Engagement Initiative is a principal means by which we

can facilitate our connection with employees. Its activities currently

include: communication and leadership development; utilising electronic

newsletters; the Touch 6000 employee connection campaign; O&L value-

based posters; regular engagement sessions with all employees; road

shows; the Value Star Recognition Programme; specialised engagement

facilitation; SMS communication; and internal publications that go out

to all employees to acknowledge the role that their achievements and

contributions play towards the Group becoming ‘The most progressive

and inspiring company’ by 2019.

The biggest employee event is the annual series of Mwenyopaleka road

shows and in 2017 these road shows were hosted for the 13th time in

seven towns countrywide. Approximately 4,894 employees attended

under the theme ‘Connect to 2019’, which gave our employees more

insight into topics such as the O&L Legacy, ‘leading the Values’, ‘What is

breakthrough?’, the O&L Ambassadors, and our 2019 Vision metrics.

In October 2016, the O&L Group decided to participate in the Great Place

to Work® (GPTW) assessment as part of its commitment to continuing to

create ‘the most progressive and inspiring company’. The Group chose the

Great Place to Work® Institute as our strategic partner in this enterprise as it

has 25 years of experience worldwide in analysing workplaces. The Institute

conducts research and recognizes leading workplaces in more than 50

countries on six continents, representing about 10 million employees in

around 6,000 organisations of varying size, maturity, and structure across

a wide range of industries. From these results, great workplaces are ranked

on various lists such as the Fortune’s 100 Best Companies to Work and the

Forbes Africa’s 100 Best Companies To Work For.

This evaluation is an important way to measure how we are progressing

in achieving our breakthrough Vision 2019 metric ‘Employer of choice’

and also how successfully we are bringing our Purpose, ‘Creating a future,

enhancing life’, to fruition. Furthermore, we are able to benchmark

ourselves against the best workplaces across the world through the GPTW

assessment process in order to improve on our current practices, ensuring

they support a breakthrough performance culture whereby employees

are able to purposefully produce breakthrough everywhere.

As a Group, O&L achieved an GPTW Employee Trust Index score of 68%

compared to 88% in the Top 100 Global Companies of similar size (between

2 501 to 5 000 employees) and 87% in the Top 100 Global Companies

(irrespective of size).

Kraatz Marine

Over the reporting period, 19 students from the Namibia Institute of

Mining and Technology (NIMT) joined Kraatz Marine as apprentices. These

students were given the unique opportunity to be mentored and coached

by master craftsmen who have worked in the engineering sector for many

years and who possess a wealth of experience locally and internationally in

fields such as boiler making, welding, and fitting and turning.

Kraatz Marine employees attended various other training interventions,

such as Helicopter Underwater Escape Training, Safety, Health and

Environmental Representative training, First Aid qualifications, Fire watch,

Rigging, and Relationship Systems Coaching.

Namibia Dairies

This year, Namibia Dairies provided both formal and informal training to

employees and once again financially supported some of them in their

professional development studies in various fields. Other employees

participated in the Namibia Training Authority (NTA) National Certificate in

Wholesale and Distribution. Namibia Dairies also provided NIMT apprentices

with the opportunity to gain hands-on technical skills in a practical work

environment.

Namibia Breweries

Namibia Breweries employees participated in various development

programmes and vocational education and training courses over the

reporting period and some also followed degree studies. In addition,

the company financially supported employees through study loans and

internal bursaries. The Apprentice Brewer Programme remains one of

our most notable initiatives for growth with apprentice brewers taking up

permanent roles with the company. Some employees were also enrolled

in the National Certificate in Wholesale and Distribution (Level 2).

Namibia Breweries continues to support students through bursaries

offered to those attending class at the Namibia Institute of Mining

and Technology (NIMT). Namibia Breweries also granted additional job

attachments to students in various technical fields.

O&L Leisure

O&L Leisure hosts its own in-house development programmes, with the

purpose of taking training and development opportunities to its people

at the individual properties, thus giving them an opportunity to engage in

learning while working so that they can identify the practical applications

of their training directly in the workplace setting.

We recently signed MoUs (Memorandum of Understanding) with the

Namibia University of Science and Technology (NUST) and the University

of Namibia (UNAM) that will allow outstanding students at the NUST Hotel

School to join the company as interns.

Broll and List Property Management Namibia (BROLL)

Broll employees attended various Group development initiatives

throughout the year. External SAMTRAC training (Occupational Health and

Safety) added value to the current service offerings within the Facilities

Department.

Model PnP Namibia

Model PnP Namibia offers several development and growth opportunities

to its employees, such as leadership training, health and safety courses,

customer service courses, and operational training. Another of these

opportunities is the Retail Trainee Manager Programme, which PnP offers

to internal employees and certain graduates in order to develop their

aptitudes for future leadership positions within retail. After graduating

from this programme, the employee/graduate will have gained the

knowledge and skills to apply for an Assistant Store Manager position

within PnP.

SUSTAINABILITY

76

SUSTAINABILITY

77

EMPLOYEE WELLNESS PROGRAMME

The Ohlthaver & List Group Wellness Programme is committed to the

overall wellbeing of all employees through the excellent wellness and

support services it provides. The Group’s Mission in this regard is to

enhance and sustain its employees’ wellbeing.

The Group is dedicated to providing employees with reliable and

professional wellness services in order to promote physical, emotional,

and social wellbeing. The programme thus promotes the employees’

health and wellbeing, improves staff morale, and creates a supportive

environment for those wishing to make personal lifestyle changes.

The Wellness Programme is also a resource for managers and supervisors,

benefiting the Group by improving productivity, reducing injuries and

illnesses, reducing absenteeism and lost work time, and creating a culture

of health.

The Wellness Programme is guided by seven core principles that aim to

create a great place to work and a culture of employees who are healthy,

happy and motivated:

Wellness Programme initiatives undertaken over the reporting period

include:

- HIV Management Programme

- Absenteeism Management Programme

- Psycho-social support services, i.e., counselling services, crisis

intervention, and trauma-defusing services

- Regular wellness site visits

- Wellness education and awareness

- Wellness screenings

- Voluntary counselling and testing

- Prostate cancer screenings

- Celebration of national and international health and wellness days

- Wellness care and support

- Wellness training

The O&L Group has received the GPTW Certification seal, which indicates

the high levels of trust prevalent across our operations, levels that result

in strong employee engagement and that are a reflection of great work

practices. This Seal of Excellence is only issued to companies that have

achieved a certain threshold in terms of employees’ positive feedback and

experiences in the workplace.

O&L has committed to continue participating in the GPTW survey. The Group

will also continue to implement the results emanating from the survey to

increase employee engagement and trust levels in the organization.

OCCUPATIONAL HEALTH AND SAFETY

During the period under review, the Group conducted in-house audits

at all OpCos to determine their adherence to the Group Risk Control

Standards. These standards are based on international best practices in

the occupational health and safety field and were developed to ensure

compliance with national legislation and regulations.

During the past financial year, a process to review the standards was

initiated in order to integrate the Health and Safety standards and systems

with those of Environmental Management, in order to improve service

and streamline operations.

During the past year the Group DIFR (Disabling Injury Frequency Rate) has

decreased by 0.191 compared against the previous year. The DIFR has now

decreased for the fourth year in succession, indicating the value of the

adoption of stringent standards and increased monitoring and inspection.

During April 2017, the Group celebrated World Safety Day for the first time,

with a Group-wide awareness campaign aimed at improving the rate of

incident reporting. During this campaign, all sites across the Group hosted

training sessions aimed at increasing employees’ understanding with

regard to the need for reporting incidents in a timely manner, as well as

the type of incidents that need to be reported. This initiative is aligned with

the activities of the International Labour Organisation’s to promote Health

and Safety in the Workplace.

O&L GROUP DISABLING INJURY FREQUENCY RATE 2014 - 2017

1.20

1.00

0.80

0.60

0.40

0.20

0.00

Ju

l

Au

g

Sep

Oct

No

v

Dec

Ja

n

Feb

M

ar

Ap

r

M

ay

Jun

2013/2014 2014/2015 2015/2016 2016/2017

PREVENTATIVESERVICES

CASEMANAGEMENT

WELLNESSTRAINING

ORGANISATIONALCONSULTATION

STAKEHOLDERENGAGEMENT

MARKETING

MONITORING& EVALUATION

SUSTAINABILITY

78

SUSTAINABILITY

79

AWOL 4.6%

SOCIAL SECURITY LEAVE 10.3%

PAID SICK LEAVE 63.4%

UNPAID SICK LEAVE 9.7%

COMPASSIONATE LEAVE 8.2%

INJURIES ON DUTY 3.8%

ABSENTEEISM

The Group’s absenteeism rate during the year under review was 2.42%,

well above our 1.75% target absenteeism rate. This shows an increase

in the rate from 2.13% in 2016 (numbers have been restated due to

redefinition of categories). The Group is unsure of the reasons for this

increase but assumes that this can be ascribed in part to more rigorous

capturing of absenteeism data. This will be closely monitored over the

next financial year.

The Ohlthaver & List Group is committed in improving the health,

wellbeing and attendance of all employees. The Group recognises that

employees are likely to be absent from work due to sickness or ill health

at some point in their lives and it is important that appropriate procedures

are in place to support employees during these periods, as well as to

manage and monitor absences. The Group has developed an Absenteeism

Management Programme to have appropriate procedures in place to

manage and monitor absences. The programme will be implemented as

from 1 July 2017.

The Ohlthaver & List Group Wellness Programme also continues to

implement various prevention and intervention programmes such as

health education and awareness interventions; psycho-social support

services i.e. counselling services, crisis intervention, and trauma-defusing

services; as well as training on absenteeism management for both

employees and management. These programmes and services focus on

the employees’ physical, psychological, social, spiritual and organisational

wellbeing with the aim of reducing absenteeism.

CORPORATE SOCIAL INVESTMENT

In bringing the O&L Group Purpose to life through its corporate social

investment (CSI) initiatives, the Group invested in excess of N$12.3 million

in community initiatives during the period under review, well above the

1% of net profit set as our benchmark (consistent with international

benchmarks).

Supported by the OpCos, CSI initiatives driven at the O&L Group-level

focused primarily on education and skills development as key enablers of

community upliftment. Joint initiatives funded over the reporting period

by all the OpCos include the following (among others):

- Building two containerised classrooms and a soup kitchen for 440

learners of the Monte Christo Primary Project school in Havana, Katutura.

These modern classrooms are built from refurbished containers with

the aim of relocating them to new premises for the school when the

allocated land has been fully serviced by the local authority.

- Ongoing general support ranging from product donations to

distribution of teaching aids and school bags, benefiting approximately

2,232 orphaned or vulnerable learners at the Monte Christo and Moses

Garoëb Primary Project schools in Havana, Katutura.

- Various other initiatives in support of education − such as the donation

of 36,080 m2 of land to the Otavi Primary School, and financial support

towards the Etunda Farm School in the Otjozondjupa Region.

In addition to the above, further FY17 CSI highlights by the O&L Group

OpCos include the following:

Broll and List Property Management Namibia (BROLL)

In addition to providing office and exhibition space to various charitable

organisations, Broll also initiated numerous projects to further enhance

education for the learners at Monte Christo and Moses Garoëb Primary

Project schools.

Dimension Data

Dimension Data continued its support of orphaned and vulnerable

children, as well as its investment in skills development, producing four

graduates from the Exponential Training (XT) Programme during the

period under review.

Hangana Seafood

In addition to Hangana’s monthly fish donations to various charities −

and in particular homes for children with disabilities, orphans, and the

elderly − Hangana also provided bulk donations of canned fish to assist the

communities affected by drought in Otjimbingwe, Opuwo and Tsumkwe.

Kraatz Marine

The Learn to Weld Programme continued to provide young Namibians with

basic welding and other valuable skills, in order to enhance employment

prospects among the unemployed youth in the Erongo Region, allowing

three welders to graduate during the period under review.

Namibia Breweries Limited

Namibia Breweries continued to invest heavily in the communities in which

it operates, increasing its focus on promoting responsible drinking and

managing environmental resources through strategic partnerships with

key stakeholders.

Core projects supported during the year under review include the DRINKiQ

initiative, which saw an additional 1,300 people trained on the impacts

of alcohol consumption, as well as the Condom Distribution Project and

the Blow the Horn on Rhino Poaching initiative. In addition, NBL donated

a two-seater aircraft to the Intelligence Support Against Poaching (ISAP)

project in February 2017. This aircraft, known as The Protector, will be used

for tracking collared rhino, locating poachers, providing air support for

ISAP, as well as patrols in national parks and private reserves.

PERSONNEL ABSENTEEISM 2016/17

SUSTAINABILITY

80

SUSTAINABILITY

81

ENVIRONMENTAL SUSTAINABILITYThe commitment of the O&L Group to the environment is entrenched in

its Value: ‘Naturally today for tomorrow’ as well as its 20% carbon footprint

reduction Vision metric. To this end, appropriate policies and procedures

have been developed based on ISO 14001 requirements to ensure that

environmental impacts are determined, regulatory requirements are

met, and suitable environmental practices are applied. The Group believes

that protection of the environment and our natural resources is critical

in the future sustainability of businesses and Namibia as a whole. The

Group continues to embrace a multi-stakeholder approach in promoting

sustainable environmental practices in and beyond its business.

ENVIRONMENTAL PRECAUTION

The O&L Group Risk Management System makes provision for the

assessment of potential risks that operations − and especially new projects

and business expansions − may have on the environment. In cases where

risks are identified, measures are taken to avoid the risk and if a feasible

alternative is not available, to actively mitigate the risks so as to reduce

them to an acceptable level. Environmental impact assessments are

conducted for projects that fall under the ambit of the Environmental

Management Act (Act 7 of 2007).

ENERGY AND WATER CONSUMPTION

Electricity, fuel and water are key resources in the O&L Group’s production

and conversion processes.

Electricity supply during the previous two reporting periods has improved

somewhat, with the national electricity supplier having secured medium-

term contracts with neighbouring countries. However, the cost of

electricity remains a material issue, especially in the retail and production

sectors of our business.

The water shortage −especially in the central regions of Namibia −as a result

of the drought has compelled the Group to explore and implement critical

alternative supply and water-savings initiatives. Namibia Breweries Limited

has managed to extract approximately 27% of its water requirement from

on-site boreholes and in addition to water saving, reuse and recycling

initiatives, the Group is proud to announce that the 30 - 40% savings

enforced by the local authority (City of Windhoek) were met in its brewing,

dairies and properties management sectors during the reporting period.

RAW MATERIAL PROCESSED

2013/14 2014/15 2015/16 2016/17

Malted barley for brewing tons 30 662 31 023 29 108 29 124

Fish landed tons 12 615 10 003 11 373 10 094

Fish processed tons 13 409 11 176 12 445 12 629

Milk intake, own production ex !Aimab liters (‘1000) 15 555 15 137 14 341 13 749

Milk intake: local producers liters (‘1000) 7 833 8 925 9 788 9 603

Milk powder converted tons 405 678 328 301

Concentrates/pulps converted tons 1 064 1 269 1 439 1166

(The Group’s packaging material scope is extremely diverse and complex and the exact usage has not been determined)

Namibia Dairies and Windhoek Schlachterei

In addition to continuing with regular and ongoing donations of dairy

and meat products to long-standing CSI beneficiaries, Namibia Dairies

successfully launched a programme to develop emerging communal

farmers by empowering them with dairy-specific skills in order to support

the growth of Namibia’s dairy industry. The first year of the Dairy Industry

Development Programme delivered five graduates who will continue to

benefit from further mentoring and coaching.

O&L Leisure

While O&L Leisure continued to support the development of young

journalistic talent in partnership with Namibia Media Holdings, various

sponsorships were made available in support of school fundraisers as well

as conservation initiatives.

Model Pick n Pay

The community upliftment initiatives driven by each of Pick n Pay’s 22

stores throughout the country were further complemented by the

company’s support to environmental initiatives in partnership with the

Recycle Namibia Forum (RNF). As well as supporting recycling awareness

and raising funds for the RNF through the sale of Pick n Pay cloth bags, the

company was also the first retailer to support battery recycling in Namibia.

SUSTAINABILITY

82

SUSTAINABILITY

83

THE ENERGY AND WATER INTENSITY AND EFFICIENCIES

Energy and water efficiencies have shown mixed results across our

operations when compared against the previous reporting period.

Electricity efficiency at Hangana Seafood improved as a result of increased

production volumes and savings initiatives. However, water efficiency

at the same operation decreased as a result of the improved cleaning

methods initiated in order to counter possible quality and food safety

risks.

Water efficiency at Namibia Breweries Ltd and Namibia Dairies Ltd improved

significantly due to water-saving measures. Electricity efficiencies at

Namibia Breweries Ltd still remain a huge challenge because of the

significant reduction in production volumes that began in 2012 – 13, as

well as the recent installation of additional water extraction and wood chip

boiler auxiliary equipment.

Electricity efficiencies in the retail sector have come under pressure with a

number of new and refurbished stores not having achieved their optimal

potential. The O&L Group is nevertheless confident that efficiencies are

well within industry benchmarks and continue to exceed our expectations.

Some selected energy and water efficiencies are reflected in the below

table:

WATER, FUEL AND ELECTRICITY CONSUMPTION

2013/14 2014/15 2015/16 2016/17

Hangana Seafood

Fishing vessels fuel efficiency l/ton landed 575 533 502 509

Electricity efficiency kWh/ton processed 946 1036 936 916

Water utilisation m3/ton processed 16.2 17.3 17.6 18.4

Namibia Breweries

Electricity efficiency (incl. solar) kWh/hl packaged 8.96 9.24 9.46 9.73

Water utilisation (incl. boreholes) hl/hl packaged 4.91 4.76 4.42 4.27

Heating efficiency MJ/hl packaged 65.2 64.9 70.2 61.9

Namibia Dairies (Avis production facility restated)

Electricity utilisation kWh/l product produced 95.2 86.5 92.6 98.4

Water utilisation l/l product produced 3.52 3.34 3.22 2.69

Heating efficiency l HFO/l product produced 20.46 19.70 20.07 20.36

O&L Leisure (Midgard/Mokuti only)

Electricity efficiency kWh/guest night 36.2 32.1 32.3 34.6

Model Pick n Pay

Electricity efficiency (comparable stores) kWh/product sold 193 182 173 204

WATER, ELECTRICITY AND FUEL CONSUMPTION

Electricity consumption throughout the Group has increased by 6.3%

compared to the previous reporting period as a result of new additions

in our retail sector as well as operations at the Strand Hotel Swakopmund.

Potable water consumption (municipal and desalinated) has decreased

significantly (by 20%) due to savings initiatives in our brewing and dairy

operations but increased in the fishing sector as a result of improved

cleaning regimes. Use of heavy furnace oil (HFO) for heat energy decreased

by 42% as a result of the success of the biomass boiler installed at Namibia

Breweries Ltd. Use of fuel on our fishing vessels was also reduced whilst

fish-meal furnace-fuel use increased.

WATER, FUEL AND ELECTRICITY CONSUMPTION

UOM 2013/14 2014/15 2015/16 2016/17

Electricity kWh 63 129 842 61 226 237 65 299 094 69 447 715

HFO for heating liter 4 154 172 4 135 132 4 128 435 2 408 500

Fuel for fish-meal furnaces liter 537 108 448 704 578 533 87 140

Fuel for fishing vessels liter 7 258 958 5 327 779 5 714 706 5 137 797

Fuel for secondary transport and other applications liter 1 677 406 1 705 605 1 765 483 1 989 104

Water: municipal (potable) m3 1 513 568 1 368 723 1 255 999 1 004 569

Water: desalinated m3 103 029 97 740 89 703 91 661

Water for agronomy m3 4 169 126 3 664 238 3 028 195 3 299 826

Water from boreholes (estimated) m3 90 000 100 000 138 487 349 287

SUSTAINABILITY

84

SUSTAINABILITY

85

The O&L Group’s actual carbon footprint has decreased by 1.1% across

operations compared to the increase of 7.2% reported during the previous

reporting period. This FY17 decrease can mainly be ascribed to a decrease

in the use of heavy furnace oil at Namibia Breweries Ltd, with this fossil

fuel being partially (50%) replaced by a renewable biomass (wood chips) for

fuel. There has also been a decrease in vessel fuel use at Hangana Seafood.

However, additional retail stores − as well as the addition of the Strand

Hotel Swakopmund and Chobe Water Villas − have added to the Group’s

carbon footprint. So compared to the base year of 2012/13, the Group’s

actual carbon footprint has decreased by 10.5% and by 11% if volume

fluctuations are taken into account. The Group is confident that its 20%

carbon footprint reduction Vision metric will be achieved once the biomass

boiler at Namibia Breweries Ltd reaches its full potential, the biogas plant at

the !Aimab Superfarm becomes operational, and energy-savings initiatives

are more fully implemented.

Note: Scope 3 (indirect) elements of the Greenhouse Gas Protocol have

not been established by the O&L Group, but it is assumed that these are

dominated by fuel used in the primary distribution (an outsourced function)

of raw materials, packaging materials, and final products consumed. The

impact of ozone-depleting gases and nitrates and sulphides (NOx and SOx)

has also not been determined.

The Group has revisited its energy-savings strategy and our focus will now

be on:

- Increased employee and management awareness;

- Process optimisation to increase efficiencies; and

- Solar (photovoltaic) power installations.

CARBON FOOTPRINT

The O&L Group fully recognizes the impact its activities have on the

environment and, in particular, how these activities can contribute to

climate change.

The O&L Group’s carbon footprint (scopes 1 and 2 of the Greenhouse Gas

Protocol) is dominated by electricity consumption in its manufacturing

and retail operations, heavy furnace oil (HFO) used in generating heat in

the beer and soft drink and milk/juice sectors, and fuel consumption in

the fishing sector.

HFO FOR HEATING 6%

FUEL FOR FISHING VESSELS 12%

ELECTRICITY 72%

OTHER FUEL/GASES 7%

METHANE 3%

CARBON FOOTPRINT CONTRIBUTORS 2016/17

OTHER 1%

O&L LEISURE 6%

MODEL PICK N PAY 27%

NAMIBIA BREWERIES LTD 26%

HANGANA SEAFOOD 26%

SEGMENT CONTRIBUTION TO CARBON FOOTPRINT 2016/17

NAMIBIA DAIRIES 14%

O&L GROUP CARBON FOOTPRINT (tons CO2e)

110 000

100 000

90 000

80 000

2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Group actual O&L Group adjusted for volumes Target

SUSTAINABILITY

86

SUSTAINABILITY

87

During the past year, the Group also celebrated World Environment Day by

engaging employees in an arts and crafts competition aimed at increasing

employee interaction with the environment. Awareness sessions with the

Snake Conservation Association of Namibia were also held at various sites

where the potential for human-snake conflict exists.

WASTE MANAGEMENT AND RECYCLING PROGRAMMES

The O&L Group’s ongoing drive to inculcate a culture of integrated

waste management and environmental consciousness at the workplace

continues to result in all solid waste generated at major business operations

being managed in line with national best practice.

Registered waste-management contractors are contracted to handle the

waste being generated at our operations and where there are no private

contractors available, municipal services are utilised to deal with waste −

for example in smaller towns and settlements. Where specialised waste-

handling services are required, reputable contractors are contracted to

deal with more hazardous wastes.

A detailed waste-stream assessment was carried out for all operations and

the highest proportion of waste (in terms of weight) was subsequently

found to be generated through production processes.

The aim of waste management at the OpCos is to minimise the amount

of waste going to landfill through the optimisation of recycling potential

and a reduction in total waste volumes produced. Currently, on-site waste

generation information is only available for NBL and Namibia Dairies: for

the year in review, 45% of all waste generated at Namibia Dairies was

recycled (up 5% from the previous year). For NBL the amount of waste

recycled has remained stable at about 80% for the past two years.

A process is currently being established that will also ensure that more

accurate data for waste generated is available to OpCos, thus allowing them

greater oversight in terms of setting waste-management targets at their

sites. Efforts have also been made to utilise organic waste. For example,

spent grain from NBL is used as cattle feed at the !Aimab Superfarm and

organic dairy waste and food waste is donated as pig feed. At Hangana

Seafood, fish offal is processed into fishmeal.

Effluent discharge volumes in the Windhoek area have decreased as a

result of our water-savings initiatives. Three major and two minor incidents

were recorded at Namibia Breweries and Namibia Dairies respectively

where effluent discharge quality did not meet the required regulatory

standards, however; an objection − based on the appropriateness of the

sampling methods applied − has been lodged against the penalties that

resulted and this is currently under review.

CARING FOR OUR ENVIRONMENT

During this reporting period, O&L Group once again supported various

clean-up campaigns throughout Namibia through the Recycle Namibia

Forum (RNF); we are also playing an integral role in the development

of activities that will assist the organisers of clean-up campaigns in

maximising their recycling potential. Through RNF, the Group is also

continuing to engage with government on issues related to sustainable

waste management on a national and strategic level.

Through it’s OpCos, the Group also supported various organisations’

efforts aimed at preserving our natural resources including (among

others) sponsorship of the clean-up campaign, Project Shine, as well as the

Intelligence Support Against Poaching (ISAP) project – one of the biggest

campaigns to date aimed at gathering information related to poaching

activities and successful prosecution of offenders.

Continued education and awareness-raising initiatives during the year

ensured that addressing the impacts of the recent water crisis across

Namibia remains a priority issue for the Group. Close relationships were

established with the relevant stakeholders in order to ensure that the

Group can be pro-active and play a leading role in ensuring that water

savings can be maintained for as long as water shortages remain a pressing

national concern.

REPORTS

88

REPORTS

89

ASSURANCE OBJECTIVES AND RESPONSIBILITIES

The primary objectives of the assurance process, and the responsibilities

of Sustainability Consulting in this regard, are to provide O&L’s stakeholders

with an independent ‘moderate level assurance’ opinion on whether:

- The sustainability content of the O&L report adheres to the principles

of Inclusivity, Materiality and Responsiveness;

- Specific data reported by O&L related to selected sustainability

indicators meets reasonable tests for accuracy, consistency,

completeness and reliability; and

- The report complies with the requirements of the Global Reporting

Initiative (GRI) G4 “Core” Level Reporting Guidelines.

In the execution of this assurance assignment, it was the responsibility of

O&L to provide Sustainability Consulting with appropriate levels of access

to relevant information, systems, sites and individuals required to fulfil

these objectives. It is the opinion of Sustainability Consulting that the

Company executed this responsibility to the degree required for the

assurance assignment to be successfully executed.

ASSURANCE APPROACH AND LIMITATIONS

The process applied in developing this assurance statement is based

on the AA1000AS (2008) principles of Inclusivity, Materiality and

Responsiveness, the GRI G4 Reporting Guidelines, and all other relevant

best practices in the field of sustainability reporting and assurance.

In this regard, Sustainability Consulting’s approach to the assurance

engagement included the following:

- A review of sustainability measurement and reporting procedures in

place at the O&L Head Office;

- A review of the processes applied by the company in the determination

of Material Aspects (as defined by the GRI G4 Reporting Guidelines) and

the identification of key stakeholders groups;

THE BOARD, MANAGEMENT AND OTHER STAKEHOLDERS OF

OHLTHAVER & LIST:

Sustainability Consulting was commissioned by Ohlthaver & List (hereafter

O&L) to provide Independent Third Party Assurance over the Company’s

Integrated Annual Report covering the period 1 July 2016 to 30 June 2017.

ASSURANCE STANDARD

As has been the case for the O&L Integrated Annual Reports in the preceding

two years, the assurance engagement was conducted according to a Non-

Aligned assurance model. As such, the engagement was not conducted in

strict accordance with any particular assurance standard.

At the same time, the assurance engagement was conducted with

particular consideration of the principles of Inclusivity, Materiality

and Responsiveness, which serve as the guiding principles of the

AccountAbility AA1000S (2008) Assurance Standard.

The assurance engagement was conducted with due consideration of

any inherent limitations related to the collection, collation, sampling

and analysis of various types of non-financial data included in the O&L

Integrated Annual Report.

INDEPENDENCE

It is confirmed that during the past year, Sustainability Consulting has

not provided O&L with any form of advisory services, or undertaken any

commissions for the Company, that might in any way compromise the

independence of the assurance process. Sustainability Consulting has also

not been responsible for the preparation of any part of the Integrated

Annual Report. Consequently, Sustainability Consulting remains an

independent assurer over the content and processes pertaining to this

Report.

ASSURANCE STATEMENT

- A review of the approaches adopted by the Company to management

of these Material Aspects and engagement with key stakeholders;

- An in-depth review of the accuracy, consistency, completeness and

reliability of samples drawn from the information and/or data

collected, collated and reported on by O&L in its 2017 Integrated

Annual Report, both within the Company’s Head Office and at selected

sites in the Group’s operating companies.

INDICATORS ASSURED

In addition to the review of Material Aspects and key stakeholder groups,

the following elements and their corresponding indicators, drawn from

the GRI G4 Reporting Guidelines, were subject to assurance:

Governance processes

- Risk Management

- Regulatory Compliance

Human Capital

- Skills shortages

- Vacancy rates

- Employee turnover

- Employee training / skills development

Environmental Indicators

- Water consumption and mitigation

- Energy consumption and mitigation

- Greenhouse gas emissions

The assurance assignment further served to confirm that that the report

effectively addresses all indicators required to conform to the GRI G4

Guidelines for a “Core” Level report.

The assurance process was limited to the disclosures made in the O&L

Integrated Annual Report for 2017, and to a review of relevant policies

and procedures related to the indicators described above.

It did not extend to engagement with any stakeholders other than

relevant company employees and management representatives

responsible for the indicators under review.

FINDINGS

The assurance process determined that O&L’s sustainability reporting

processes remain appropriate to the level of governance applied by the

Group. Furthermore, these processes appear to be subject to continuous

development on an ongoing basis, with the result that they appear

considerably more advanced than is the norm amongst the majority of

Namibian corporate entities.

It is further noted that:

- The Company’s systems for the data collection, collation and reporting

of sustainability data are well-established and subject to continuous

development; as a result, these systems provide effective support for

the management of sustainability-related issues.

- All site-specific data evaluated was found to be reasonably accurate

and/or reliable.

- O&L’s reporting processes appear to effectively reflect the AA1000AS

(2008) principles of Inclusivity, Materiality and Responsiveness.

- The Report appears to adequately meet the requirements of the

GRI G4 Reporting Guidelines for a “Core” Level Report, with adequate

responses provided for all Standard Disclosures, as well as for

Disclosures on Management Approaches to Material Aspects.

CONCLUSIONS AND RECOMMENDATIONS

Based on the information reviewed during this engagement, Sustainability

Consulting is confident that the Report provides a comprehensive and

balanced account of O&L’s management of its identified Material Aspects

and key stakeholder groups, as well as of its performance in the context

of financial and non-financial sustainability, for the period under review.

REPORTS

90

REPORTS

91

The data reviewed is generated through a systematic process, and

accurately represents the Company’s ability to manage and report on

all aspects of its sustainability performance, while conforming to the

AA1000AS (2008) principles of Inclusivity, Materiality and Responsiveness.

Moreover, the fact that the Company’s data management systems have

been operational for a number of financial years, provides increasing

opportunities for in-depth analysis of trends and developments in areas

related to sustainability performance.

The following areas have been identified as requiring further consideration

or actions:

- Over the next several months, the GRI G4 Reporting Guidelines will be

phased out, and will be replaced with the Comprehensive GRI

Reporting Standards. These standards will be required for all reports

published on or after 1 July 2018. It is therefore recommended that

relevant senior management representatives within O&L, along with

those representatives of the Company responsible for the

management of the Group’s sustainability-related data management

and the preparation of the Integrated Annual Report, familiarise

themselves with the Comprehensive Reporting Standards. Such

familiarisation is likely to prove particularly valuable in the preparation

of the Group’s Integrated Annual Report for 2018.

- With regard to future activities related to the assurance of O&L’s

sustainability reporting activities, it is recommended that the

company considers undertaking such assurance activities in line with

accepted Independent Third Party Assurance standards such as the

AA1000AS (2008) or the ISAE3000 Accounting Standard.

For additional information regarding the processes and documentation

related to this assurance engagement, please e-mail info@

sustainabilityconsulting.co.za

For Sustainability Consulting

16 August 2017

UNTAPPED EARTH

SUSTAINABLE HARVESTS

REPORTS

94

REPORTS

95

2017 2016

N$’000 N$’000

Value retained

Profit for the year attributable to owners of the parent 163 351 329 366

Non-controlling interest 228 809 262 614

392 160 591 980

Total Wealth Distributed 3 222 591 3 011 747

1. Additional amounts collected on behalf of central and local government

Quota levies 6 583 5 855

Rates and taxes paid on properties 14 098 12 508

Customs and excise duties 680 369 580 555

Net Value Added Tax paid 276 089 157 399

Pay-as-you-earn tax (PAYE) deducted from remuneration paid 139 077 114 737

Non-resident shareholders’ tax (NRST) deducted from dividends paid 366 4 491

Withholding tax on services, interest and royalties 5 564 8 301

1 122 146 883 846

2017 2016

N$’000 N$’000

WEALTH CREATED

Value added by operating activities

Revenue 6 406 980 5 660 086

Paid to suppliers for materials and services (3 153 310) (2 893 634)

3 253 670 2 766 452

Value added by investing activities

Interest income 22 264 21 837

Fair value adjustments 97 646 230 377

Loss from equity accounted investments (150 989) (6 919)

(31 079) 245 295

Total Wealth Created 3 222 591 3 011 747

WEALTH DISTRIBUTED

To Pay Employees

Salaries, wages, medical and other benefits 1 005 833 931 840

To Pay Providers of Capital

Finance costs 223 505 196 700

To Pay Government

Income tax 114 552 135 367

Additional amounts collected on behalf of central and local government 1 1 122 146 883 846

1 236 698 1 019 213

To be retained in the business for expansion and future wealth creation:

Value reinvested

Depreciation, amortisation and impairments 307 244 232 241

Deferred tax 57 151 39 773

364 395 272 014

GROUP VALUE ADDED STATEMENT

REPORTS

96

REPORTS

97

2017 2016 2015 2014 2013 2012 2011

N$’000 N$’000 N$’000 N$’000 N$’000 N$’000 N$’000

Consolidated Statements of Financial Position

Property, plant and equipment 3 462 736 3 256 234 2 927 207 2 696 792 2 305 890 2 215 497 1 925 782

Investment property 1 980 714 1 845 382 1 589 504 1 429 946 1 310 316 1 109 364 980 758

Intangible assets 46 197 31 292 25 108 21 973 23 687 17 587 17 563

Deferred taxation 4 615 1 793 15 364 21 940 38 965 37 201 50 270

Non-current investments 492 454 656 266 76 331 13 511 22 265 29 364 26 928

Non-current biological assets 45 264 38 199 37 646 33 998 33 952 33 276 30 955

Non-current trade and other receivables 39 538 41 546 43 804 47 263 47 416 42 377 45 068

Non-current related parties 4 531 3 328 2 590 1 008 - 100 605 106 352

Current assets 1 638 377 1 437 774 1 341 657 1 166 259 1 226 587 1 095 102 937 363

Non-current assets classified as held for sale 53 898 1 425 4 500 6 375 17 479 23 934 5 796

Property units for sale 33 615 150 862 76 761 - - - -

Total assets 7 801 939 7 464 101 6 140 472 5 439 065 5 026 557 4 704 307 4 126 835

Equity attributable to owners of the parent 2 912 811 2 682 523 2 276 310 2 029 247 1 683 570 1 444 949 1 183 477

Non-controlling interests 1 215 781 1 042 756 886 737 806 271 715 908 746 314 655 256

Deferred taxation 513 095 454 164 417 065 385 732 294 562 252 747 236 695

Non-current interest-bearing borrowings 1 683 563 1 745 887 1 209 798 1 012 978 1 003 983 1 306 622 1 073 684

Deferred income 3 139 2 775 7 928 4 900 - - -

Non-current provisions 53 868 44 585 43 790 43 280 41 584 37 397 32 052

Non-current trade and other payables 6 500 5 656 4 784 3 362 3 449 5 380 3 653

Non-current related parties 7 604 16 907 28 273 10 636 12 506 14 149 9 139

Current liabilities 1 405 578 1 468 848 1 265 787 1 142 659 1 270 995 896 749 932 879

Total equity and liabilities 7 801 939 7 464 101 6 140 472 5 439 065 5 026 557 4 704 307 4 126 835

SEVEN YEAR REVIEW

2017 2016 2015 2014 2013 2012 2011

N$’000 N$’000 N$’000 N$’000 N$’000 N$’000 N$’000

Consolidated Statements of Comprehensive In-

come

Revenue 6 406 980 5 660 086 5 306 276 4 928 643 4 585 661 4 133 899 3 546 975

Operating profit after fair value adjustments and

gain on biological assets and agricultural produce

874 778 948 902 820 789 790 159 788 234 628 523 594 523

Finance costs (223 505) (196 700) (147 801) (144 249) (142 985) (134 087) (103 062)

Share-based payment expense - - - - - -

Equity losses from joint ventures and associates

(on-going operations)

(150 989) (96 131) (120 501) (116 489) (107 085) (90 515) (69 549)

Equity profit (loss) from joint ventures and associates

(deferred tax asset write down)

- 89 212 - - (188 089) - -

Income from investments 22 264 21 837 26 932 16 809 21 609 24 829 23 889

Profit before taxation 522 548 767 120 579 419 546 230 371 684 428 750 445 801

Taxation (130 388) (175 140) (168 547) (169 969) (139 844) (131 754) (104 305)

Profit for the year 392 160 591 980 410 872 376 261 231 840 296 996 341 496

Other comprehensive income for the year, net of tax 134 238 84 671 8 632 151 169 59 583 134 262 128 967

Total comprehensive income for the year 526 398 676 651 419 504 527 430 291 423 431 258 470 463

Profit attributable to:

Owners of the parent 163 351 329 366 229 881 231 438 180 969 144 383 192 554

Non-controlling interests 228 809 262 614 180 991 144 823 50 871 152 613 148 942

392 160 591 980 410 872 376 261 231 840 296 996 341 496

Total comprehensive income attributable to:

Owners of the parent 239 117 411 133 238 246 345 209 238 640 274 191 288 249

Non-controlling interests 287 281 265 518 181 258 182 221 52 783 157 067 182 214

526 398 676 651 419 504 527 430 291 423 431 258 470 463

REPORTS

98

REPORTS

99

The information below should be read in conjunction with the annual

financial statements for the year ended 30 June 2017, which is available

on the website.

GROUP OPERATING PERFORMANCE

Salient features

The salient features for the year under review are as follows:

% 2017 2016

Increase N$ ‘000 N$ ‘000

Revenue +13.2 6 406 980 5 660 086

Operating profit +8.2 777 132 718 525

Fair value adjustments -57.6 97 646 230 377

Operating profit after fair value adjustments -7.8 874 778 948 902

Equity losses from joint ventures and

associates (on-going operations) +2 082.2 (150 989) (6 919)

Net finance costs +15.1 (201 241) (174 863)

Profit before taxation -31.9 522 548 767 120

Taxation -25.6 (130 388) (175 140)

Profit for the year -33.8 392 160 591 980

FINANCIAL REVIEW

The 2017 financial year was a challenging year, with the subdued local economy impacting our businesses. It is during these periods that the strengths of having a diversified Group comes to the fore. We saw an excellent performance from Namibia Breweries locally and solid results from Hangana Seafood, our Property portfolio and O&L Leisure, especially when considering the current market challenges.

“

”

REPORTS

100

REPORTS

101

Our fishing business segment contributed N$50.3 million to operating

profit in the year under review, whilst lower than the prior year, this profit

is a commendable result. Factors such as fluctuating exchange rates as

well as the availability of quota continues to plague all industry players

in this sector, which makes the continued profitability of our fishing

operations all the more noteworthy.

SHARE OF PROFITS AND LOSSES FROM ASSOCIATE AND JOINT

VENTURES

The Group equity accounted a profit of N$3.9 million (2016: N$2.8 million)

from Dimension Data Namibia and a profit of N$0.2m from Mobi-Pay and

N$0.7m from Natural Value Foods. The Group also equity accounted a

loss of N$155.7 million (2016: N$11.5 million) from Heineken South Africa

(Proprietary) Limited (formerly DHN Drinks (Proprietary) Limited). This

loss is substantially higher than the prior year due to both an increase in

our effective shareholding, impacting the percentage of operating losses

recorded as well as the impairments and other adjustments recorded by

Heineken South Africa. For further detail refer to Note 7 in the financial

statements.

FINANCE COSTS

The net finance cost for the year under review has increased from

N$174.9 million in the prior year to N$201.2 million for the year under

review. Over the course of the prior year, debt levels were increased

to fund the construction of the Swakopmund Strand Hotel and the

operational needs of Namibia Breweries Limited.

PROFIT BEFORE TAXATION

The Group saw a decrease of N$244.6 million (-31.9%) in profit before

taxation, from N$767.1 million in the 2016 financial year to N$522.5

million for the 2017 period. The key drivers of this decrease was reduced

fair value gains and higher equity accounted losses as elaborated on in

the preceding sections.

TAXATION

The 2017 financial year’s taxation charge amounted to N$130.4 million

(2016: N$175.1 million), while the effective taxation rate is 24.9% (2016:

22.8%). The effective tax rate is heavily influenced by the disallowable

equity accounted losses, various manufacturing export incentive

allowances and exempt income earned by the group.

STATEMENT OF FINANCIAL POSITION

Total assets grew by N$337.8 million, namely from N$7 464.1 million in

the 2016 financial year to N$7 801.9 million in the year under review.

The bulk of the increase stems from Property, plant and equipment

(including non-current assets held for sale) which increased by N$259.0

million. Capital additions overall amounted to N$377.0 million for the

2017 financial year (2016: N$481.4 million), which is largely constituted

by the capital additions in the Consortium Group for the new jetty and

cyclical refurbishments of its fishing vessels (N$90.3 million), Model Pick n

Pay for new and refurbishing of stores (N$51.3 million) and the Namibia

Breweries Group for plant and equipment (N$166.9 million). Construction

on 77 on Independence was completed during the financial year with

the majority of the residential units sold before year end. Total group

borrowings, inclusive of other financial liabilities, lease liabilities and bank

overdrafts of the group were largely flat on last year, increasing by only

N$10.0 million (0.5%).

REVENUE

Group revenues increased by 13.2% compared with the previous year. This

is mainly attributable to excellent revenue growth in the retail segment

(12.6%), beer and soft drinks segment (11.7%), leisure segment (33.1%)

as well as the properties segment (124.8%). A significant driver of the

growth in properties segment was the sale of the completed residential

units from the mixed use development called 77 on Independence.

The average growth in revenues was pulled down slightly by the fresh

produce segment which delivered moderate revenue growth (2.0%) due

to volume and pricing pressures.

OPERATING PROFIT AND FAIR VALUE ADJUSTMENTS

Operating profit increased by 8.2% compared to prior year whilst fair

value adjustments decreased by 57.6% compared to the prior year.

The growth in the operating profit is attributable to the beer and soft

drinks business segment. The other large business segments, whilst still

delivering solid results, are down compared to the prior year.

The beer and soft drinks segment delivered an excellent result of N$608.3

million, which is a growth of 12.4% over the previous period and was

mainly achieved due to an overall growth of 8% in volumes. The driver

of this volume growth was the increased volumes sold and shipped to

Heineken South Africa. The increase in volumes enabled improved cost

efficiencies, in turn driving increased profitability.

The leisure segment, a new addition to our separately disclosed reportable

business segments, delivered an improvement in operating results with

the losses decreasing to N$12.3million. The growth in the tourism sector

of the domestic economy has strongly benefited this business segment,

with both the Swakopmund Strand Hotel and Mokuti Etosha Lodge

recording excellent occupancies driving good growth in revenues.

The leisure business segment is reaping the cumulative benefits of its

recent additions, such as the opening of the Swakopmund Strand Hotel

in 2016 and Chobe Water Villas in 2017, which is now enabling greater

economies of scale of various centralised costs.

The retail segment delivered a mixed performance during the year

under review, contributing N$8.8 million to operating profit compared

with N$17.2 million in the prior year. Revenues grew by 12.6% in 2017

compared to the prior year and margins remain on target, however

below the line costs mainly related to the revamping of existing stores

and the opening of new stores impacted profits unfavourably.

Inclusive of fair value adjustments, the property business segment

contributed N$238.7 million (2016: N$348.6 million) to operating profits

during the 2017 financial year. The operating profits before fair value

adjustments was very stable for the year under review, growing with 4.5%.

This segment has been impacted by the subdued short term economic

outlook, which in turn has impacted our investment property valuations.

Fair value gains on investment properties is down 61.0% compared to the

prior year, which included some once off gains such as the recognition

of the unutilised bulk potential of Wernhil Park. In the current year, this

segment recorded profits of N$ 30.9 million arising from the completion

and sale of the residential units in the mixed use development called

77 on Independence. Our flagship property Wernhil Park, continues to

deliver strong operational performance on all levels, with stable trading

densities, foot traffic counts and practically no vacancies. This continued

strong performance of Wernhil Park has driven the decision to expand

the mall. The Phase IV expansion, which commenced in July 2017 and is

envisaged to be completed towards the end of the 2019 financial year,

will increase the total trading space by 18,400m2 (an increase of 50.3%).

REPORTS

102

REPORTS

103

OHLTHAVER & LIST CENTRE

PO Box 16, Windhoek

Tel: 061 - 207 5111

Fax: 061 - 234 021

www.ohlthaverlist.com

NAMIBIA BREWERIES LIMITED

PO Box 206, Windhoek

Tel: 061 - 320 4999

Fax: 061 - 263 327

www.nambrew.com

HANGANA SEAFOOD

PO Box 26, Walvis Bay

Tel: 064 - 218 400

Fax: 064 - 218 480

www.hangana.com

NAMIBIA DAIRIES

P/Bag 11321, Windhoek

Tel: 061 - 299 4700

Fax: 061 - 299 4701


MODEL PICK N PAY


Tel: 061 - 296 4500

Fax: 061 - 296 4550


DIMENSION DATA NAMIBIA

PO Box 16, Windhoek

Tel: 061 - 373 300

Fax: 061 - 373 301

www.dimensiondata.com

BROLL NAMIBIA


Tel: 061 - 374 500

Fax: 061 - 237 499

www.brollnamibia.com.na

KRAATZ MARINE

PO Box 555, Walvis Bay

Tel: 064 - 215 800

Fax: 064 - 206 848

www.kraatzmarine.com

O&L LEISURE


Tel: 061 - 388 400

Fax: 061 - 234 021


O&L ENERGY

PO Box 16, Windhoek

Tel: 061 - 207 5111

Fax: 061 - 234 021


WEATHERMEN & CO

PO Box 16, Windhoek

Tel: 061 - 429 600


INTEGRATED ANNUAL REPORT 2017 PRODUCTION

Design and layout: Weathermen & Co

Printing and binding: Solitaire Press

Production and editing: Ohlthaver & List Centre with the assistance of GSA Campbell

GROUP REFERENCE INFORMATION

CASH FLOW

Cash flows from operating activities increased to N$790.1million in

the 2017 financial year compared to N$633.3 million in 2016. The net

cash spent in investing activities declined from N$1 112.0 million in the

previous reporting period to N$480.5 million for the year under review.

The overall decrease is a result of the acquisition of shares in an associate

made in the prior year. Cash and cash equivalents amounted to N$411.1

million for the reporting period (2016: N$245.8 million).

DIVIDENDS

The Company declared a dividend of 112c per share on 28 September

2017 (2016: 112c per share) in respect of the year ended 30 June 2017.

Günther Hanke

Group Financial Director

REPORTS

104

REPORTS

105

NOTICE TO THE SHAREHOLDERS

Notice is hereby given of the 69th Annual General Meeting of the

members of the Olfitra will be held on the 7th floor, Werner List

Boardroom, South Block, 23-33 Fidel Castro Street, Windhoek,

Namibia on Monday, 4 December 2017 at 9:00 for the following

purposes:

1. To receive and consider, and if approved, adopt the Annual

Financial Statements and the Report of the Auditors for the year

ended 30 June 2017 as submitted, and to confirm all matters and

things undertaken and discharged by the Directors on behalf of

the Company;

2. To elect Directors in the place of Messrs Udo M Stritter and Ernst

Ender who retire by rotation in accordance with article 71(b)(iv)

(A) of the Olfitra’s Articles of Association but being eligible for

re-election offer themselves for re-election.

3. To approve the remuneration of the Directors, as per article

71(b)(iv)(B) of the Olfitra’s Memorandum and Articles of

Association and as stipulated in the annual financial statements,

of the Annual Report, for the financial year ended 30 June 2017.

4. To approve the Remuneration and Compensation Policy of

Olfitra.

5. To confirm the reappointment of Deloitte & Touche as auditors

and to authrorise their remuneration as stated in article 71 (b)(iii)

(A) and (B) of the Memorandum and Articles of Association .

6. To place the unissued 6,507,083 ordinary shares of 0.50 cents each

in Olfitra under the control of the Directors who will be

authorised to allot all or any of those shares at their discretion, on

such terms and conditions and at such times as the Directors

deem it appropriate.

7. To transact any other business as can be transacted at an Annual

General Meeting.

A member entitled to attend and vote at the Annual General Meeting

is entitled to appoint one or more proxies to attend and vote in his

or her stead. A proxy need not be a shareholder of Olfitra.

In order to be valid, proxy forms must be forwarded to the registered

office of Olfitra by no later than 12:00 a.m. on Tuesday, 28 November

2017.

By order of the Board

Ohlthaver & List Centre (Pty) Ltd

Company Secretary

Windhoek

21 August 2017

106

REPORTS

PROXY FORMfor the 69th Annual General Meeting of

OHLTHAVER & LIST FINANCE AND TRADING CORPORATION LIMITED

Registration Number: 331

The Secretary

Ohlthaver & List Finance and Trading Corporation Limited

PO Box 16

Windhoek

Namibia

I/We ........................................................................................(name in full)

of .............................................................................................................

..................................................................................................................

..................................................................................................... (address)

being a shareholder of ................................................. (number

of shares) of the abovementioned Company hereby appoint

.........................................................................................................(name)

or failing him/her ....................................................................................

........................................................................................................ (name)

or failing him/her ....................................................................................

........................................................................................................ (name)

or failing him/her, the Chairperson of the meeting as my/our proxy to

vote for me/us on my/our behalf at the 69th Annual General Meeting

of the Company to be held in the Werner List Boardroom, Ohlthaver

& List Centre, 7th floor - South Block, Alexander Forbes House, 23-33

Fidel Castro Street, Windhoek Monday 4 December 2017 at 09h00 and

at any adjournment thereof, in particular to vote for/against/ abstain

from* the resolutions contained in the notice of the meeting.

I/We desire to vote as follows: For Against Abstain

1. Adoption of the annual financial statements

2. Re-election of retiring directors:

UM Stritter

E Ender

3. Approve the remuneration of Directors

4. Approve the Remuneration and Compensation Policy

5. Confirm the re-appointment of Deloitte & Touche as external auditors of the company and authorise their remuneration

6. To place the unissued shares under the control of the Directors

* Please indicate your response by inserting an “X” in the appropriate

block to either vote “for/against/abstain from”. If no indication is

given, the proxy may vote as he/she thinks fit.

Signed ...................................................... at ..........................................

this ......................... day of ........................................................... 2017.

Signature(s) of shareholder(s) .................................................................

..................................................................................................................

Notes to the Proxy

1. A member entitled to attend and vote at the aforementioned

meeting is entitled to appoint a proxy (who need not be a

member of the Company) to attend, speak and vote on a poll in

his/her stead.

2. Shareholders who wish to appoint proxies must lodge their

proxy forms at the registered office of the Company by no later

than 12h00 on Tuesday, 28 November 2017.

3. In respect of shareholders that are companies, an extract of the

relevant resolution of Directors must be attached to the proxy form.

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