In order to raise funds necessary to purchase B-BBEE shares (refer to note 6), the Company has funded the trusts by way of a loan. The loans to the trusts are interest-free. The loan to the Foundation Trust is fully repayable by 2032. Given the underlying value of the trusts' assets (Company shares), credit risk is minimal and no expected credit loss is provided for.
The property development loan funding is the long-term portion of funding provided for property development of a store used by the Group with the loan fully repayable by June 2028. As the funding is repaid using rental proceeds received from the Group, and adequate security is in place, credit risk is minimal and no expected credit loss is provided for.
Included in other is a loan of R25 million that was advanced to our co-shareholder in Magnolia Ridge Properties 291 (Pty) Ltd, with their shares in the aforementioned company held as security. The loan is repayable by February 2027.
The B-BBEE-related advance is the long-term portion of supplier and enterprise development loans advanced to black-owned businesses. Repayment terms vary and interest is charged at preferential rates. Short-term portions of these loans are included under sundry debtors in note 23.1.
B-BBEE-related advances are secured by a combination of holding title on assets, security over shares, or guarantee structures, with residual credit risk being insignificant. |
