Suidwes Integrated Annual Report 2018

Proef 12 ENG 22 Aug 2018

Compiled by Advalue - 082 375 4087

Suidwes Group Structure 2the Executive Committee 3 the Board of Directors 4Suidwes Group PROFILE 6Suidwes Group Entities 7Suidwes Holdings (RF) Proprietary Limited 8 Five Year Financial OverviewFactS Page 10Chairperson’s Report 12Managing Director’s Report 14 INDEXCorporate Governance Report 21 Sustainability Report 28FinanCIAL StateMENTS 44Administrative Information 58 1

suidwes GROUP STRUCTURE 89.36% Kimama Investments Individual producers 53 (Pty) Ltd B Shares A Shares 9.92% 0.72% Holdings (RF) (Pty) Ltd Katleho Investment Properties Company (Pty) Ltd 100% (Pty) Ltd A Shares 100% Individual Investments producers (Pty) Ltd C Shares 100% Agriculture (Pty) Ltd Ltd Suidwes IT Solutions (Pty) Ltd (49%) Suidwesfin (Pty) Ltd (100%) Suidwes IT Solutions 2 (Pty) Ltd (49%) Suidwes Brokerage (Pty) Ltd (100%) Terratek International (Pty) Ltd (100%) Botselo Mills (Pty) Ltd (34,90%) Africum Mills (Pty) Ltd (100%) PE-BEE Agri (Protek) (51%) Raddix Group (Pty) Ltd (50.02%) Africum Commodities (Pty) Ltd (99%) Wynland (Pty) Ltd (64%) Agrinet (Pty) Ltd (83.75%) NviroTek Laboratories (Pty) Ltd (80%) Network Embedded Technologies (Pty) Ltd (85%) Agrifriend Equipment (Pty) Ltd (99.9%) Agrifriend Namibia (Pty) Ltd (51%) Agrifriend Technology (Pty) Ltd (51%) Agrifriend Commodities (Pty) Ltd (51%) PAGETWo

EXECUTIVECOMMITTEE Dr. Herman van Schalkwyk Group Chief Executive Officer BCom Agricultural Economics BCom(Hons) Agricultural Economics MCom Cum Laude - Agricultural Economics PhD - Agricultural Economics Membership of professional associations: • South African Society for Agricultural Extension • International Food and Agribusiness Management Association • International Association of Agricultural Economists • Agricultural Economic Association of South AfricaDerÉK LindeGroup Chief Legal Officer & Group SecretaryB Juris | LLB | MBAAttorney admitted to the High Court of SAMembership ofprofessional association• Law Society of South AfricaJan Grobbelaar Pieter van zylChief Executive Chief ExecutiveOfficer: Grain Officer: Agrifriend EquipmentBSc Agric-Agricultural Economics BSc(Hons)BSc Agric(Hons) Agricultural Economics George PotgieterMSc Agricultural Economics Group Chief Financial OfficerMBA B.Compt | B.Compt(Hons) | CA (SA) Membership of professional association • SAICAAubrey MaRAIs Rocky le RouxChief Executive Officer: AgriCapital Chief Executive Officer: RetailBComm B Sec EdCAIB(SA) (Institute of Bankers) MURPMBA Dip: Business Management 3 Executive Committee

PAGEFOUR SUIDWES Board of Ddirectors 12 4 3 5

Mr. JJ Viljoen 1 Chairperson of the board of directors 2 Mr. GT Geldenhuys Mr. G Potgieter 3 Director: Finance 4 Mr. GL Malherbe Ms. B Mathews 5 Chairperson: Audit, Risk and IT Committee6 8 10 79 Mr. PF Delport 6 Chairperson: Social, Ethics and Remuneration Committee 7 Mr. A Botha 8 Mr. JJ le Roux Mr. FE Marx 9 Deputy chairperson of the board of directors 10 Dr. HD van Schalkwyk Managing Director SUidwes BOARD OF DIRECTORS 5

suidwes GROUP PROFILE SUIDWES GROUP True to Suidwes’ motto, “From the members, for the members”, we offer support and expertise to members and clients, through specialised and dedicated departments, operations and staff. Suidwes Investments Proprietary Limited maintains two strategic pillars, namely, Suidwes Agriculture Proprietary Limited and Africum Limited, through which members and clients are ensured of excellent growth, service and the delivery of superior products at the best value. Suidwes Agriculture possesses the expertise to know what you as the centre of your business needs and offers you the necessary knowledge and support through our specialised and dedicated operations. Suidwes Grain, with 16 grain silos, four grain bunkers and three silo bag depots, works in a dynamic environment on the national grain markets, amongst which SAFEX and offers marketing alternatives, price management stability and peace of mind regarding the storage and marketing of your product. The 20 retail branches of Suidwes Retail are distributed conveniently and strategically in the Suidwes service area and serve a wide variety of agricultural products under one roof, thereby meeting all your needs. A G R I C A P I TA L Suidwes Agriculture’s Financing division, AgriCapital, offers agricultural financing for the future. Your financing needs are analysed from 12 offices, and high-quality, personal service provides you with advice on the management of your risks. AFRICUM COMMODITIES Africum Commodities is involved in trading grain and oil seeds in the physical market. PAGEsIX

NviroTek Laboratories: A national, Suidwes Brokerage: Conducts price risk Agrifriend Equipment: A variety of suidwes GROUP ENTITIES independent laboratory that offers management for its clients by trading CASE, Krone and Kuhne brands, a variety of analyses on soil, leaves, implements and spares, supportedanimal feed, water, fertilizer, lime and market instruments on the JSE. by excellent after-sales service growth material. Their service meets and expertise, are provided by 11 workshops and 18 spares centres. international standards. Agrifriend Commodities: Focuses Agrinet: One of the leaders in irrigation Radical, reliable, real. on acquiring and trading grain in equipment supplies quality brands,the Northern and Eastern Cape, and Raddix: Specialises in comprehensive for example, Nexus, Kaufmann, Power financial services, including short- exporting lucerne. Master, Speroni and Pascali, via term credit life and harvest insurance, warehouses and national distribution financial planning and medical aids. networks in South Africa and sub- Saharan Africa. Protek: Is a young, rapidly growing, Africum Mills: The mill is located in NWET: The information technologydynamic company in the residential Wolmaransstad and offers exchange company supplies and maintains data and garden market in South Africa, communication networks over a wideNamibia and Botswana, that focuses milling meal and the full range of area and supplies, installs and maintains on pest control, fertilizer and other maize products for the Maatla brand. computers and software with a 24-hour specialty products. helpline. Agrifriend Technology and Agrifriend Terratek: Offers scientific observations, Wynland Laboratories: Specialises in Namibia: Supply energy-saving analyses and recommendations to help microbiological analyses for the wine and food processing industries in the Westernproducts and technology to clients in you manage your farming enterprise Cape. Chemical analyses of water, soil andthe Eastern and Northern Cape as well successfully, thereby increasing your profit leaves are also offered. The laboratory has as in Namibia. margin. Terratek provides advice about SANAS accreditation. crops, soil science, animal husbandry, the economics of farming, as well as geographical information systems (GIS). 7

Five YEAR FINANCIAL OVERVIEW INCOME STATEMENT 2018 2017 2016 2015 2014 Income R ‘ 000 R ‘ 000 R ‘ 000 R ‘ 000 R ‘ 000 3 035 053 2 704 381 2 607 973 2 849 107 2 887 304 Operating profit 94 176 36 499 169 313 138 122 98 708 Finance costs (67 409) (57 833) (42 177) (36 906) (38 935) Profit after finance costs 26 767 (21 334) 127 136 101 216 59 773 Profit/(Loss) from equity accounted investments 11 365 603 (5 163) (5 167) 6 250 Fair value adjustment - - 1 691 (70) - Loss on sale of assets of disposal group classified as held for sale - - - (91) - Profit/(Loss) from continuing operations before tax, Incentive Rebates and Deferred Payment Scheme 38 132 (20 731) 123 664 95 888 66 023 Net Incentive Rebates and Deferred Payment Scheme (7 255) (12 927) (16 743) (35 778) (13 931) Gross Incentive Rebates and Deferred Payment Scheme (9 704) (17 383) (22 532) (49 888) (18 218) Fair value adjustment 2 449 4 456 5 789 14 110 4 287 Profit/(Loss) from continuing operations after Incentive Rebates and Deferred Payment Scheme, before tax 30 877 (33 658) 106 921 60 110 52 092 Tax 3 290 12 158 (22 594) (15 751) (7 863) Profit/(Loss) from continuing operations 34 167 (21 500) 84 327 44 359 44 229 Discontinued operations (6 450) (11 576) (11 032) - - Loss from discontinued operations 27 717 (33 076) 73 295 44 359 44 229 Profit/(Loss) for the year 42 647 (24 149) 67 947 43 043 35 690 Attributable to: (14 930) (8 927) 5 348 1 316 8 539 Shareholders of the holding company 27 717 (33 076) 73 295 44 359 44 229 Non-controlling interest 511 338 505 076 547 906 493 418 456 631 STATEMENT OF FINANCIAL POSITION 73 545 43 458 51 028 13 915 2 712 Ordinary shareholders` interest 584 883 548 534 598 934 507 333 Non-controlling interest in equity 1 513 031 1 316 965 1 219 539 1 162 960 459 343 Total equity 2 097 914 1 865 499 1 818 473 1 670 293 761 753 Total liabilities 1 221 096 Total assets 27,88% 29,40% 32,94% 30,38% 47,51% 47,75% 36,82% 44,05% 37,60% RATIOS 24,61% 22,85% 30,24% 25,57% 23,10% 100,00% 100,00% 100,00% 100,00% 39,30% Equity to total assets 100,00% Interest-bearing liabilities to total assets Interest-free liabilities to total assets Earnings before Gross Incentive Rebates and Deferred 10,4% - 18,3% 20,4% 16,9% Payment Scheme on ordinary shareholders` interest 1,8% - 6,8% 5,7% 5,4% Return on assets, before Gross Incentive Rebates and 71,51 - 112,86 71,48 58,80 Deferred Payment Scheme on ordinary shareholders` interest Earnings per share (cent) Dividends per share (cent) - interim - - 15,00 10,00 10,00 Dividends per share (cent) - final 20,00 20,00 13,00 - - Total Dividends per share (cent) 20,00 20,00 28,00 10,00 10,00 Net asset value per share (cent) 857,37 846,87 918,69 819,22 758,15 Interest coverage (number of times) 2,0 1,0 4,2 4,2 3,3 Dividend coverage (number of times) 3,58 0,00 4,03 7,15 5,88 PAGEEIGHT

Net profit/(loss) attributable Totalto shareholders of the holding equity company 2018 - R584.9 m 2017 - R548.5 m 2018 - R42.6 m 2016 - R598.9 m 2017 - (R24.1 m) 2015 - R507.3 m 2016 - R67.9 m 2014 - R459.3 m 2015 - R43.0 m 2014 - R35.7 m Net asset value per share (cent) EaErnaringinsgpser per shsharaere(cent) 2018 - 857.37 cent 2017 - 846.87 cent 2018 - 71.51 cent 2016 - 918.69 cent 2017 - 0 cent 2015 - 819.22 cent 2016 - 112.86 cent 2014 - 758.15 cent 2015 - 71.48 cent 2014 - 58.80 centTotal dividend per share Equity to total (cent) assets 2018 - 20 cent 2018 - 27.9% 2017 - 20 cent 2017 - 29.4% 2016 - 28 cent 2016 - 32.9% 2015 - 10 cent 2015 - 30.4% 2014 - 10 cent 2014 - 37.6% Interest-bearing liabilities Short Term Long Term Earnings before Gross R million 1000 Incentive Rebates and 800Deferred Payment Scheme on 600 2015 2016 2017 2018ordinary shareholders’ interest 400 Year 200 2018 - 10.4% 0 2017 - 0% 2014 2016 - 18.3% 2015 - 20.4% 2014 - 16.9% 9 Five YEAR FINANCIAL OVERVIEW

FACTS PAGE 2017 / 2018PAGETEN

11FACTS PAGE 2017 / 2018

Growth is never by chance, it’s the result of forces working together. J a m e s C a s h UPDI K E Mr. JJ Viljoen CHAIRPERSON’S REPORT The 2017/2018 financial year will be remembered as a year blessed with a record crop, silos at capacity and consequential lower prices. Although we stored a better crop, the unfortunate result was that grain farmers still experienced financial pressures. For livestock farmers the circumstances after the good rain changed dramatically and the prices for both breeding livestock and meat surged significantly whilst farmers were rebuilding herds. The 2017/2018 production season kicked off poorly due to a La Nina weather pattern. Little and early rainfall hindered planting, while strong wind caused vast damage. However, late rain ensued and many late cultivations transpired, especially sunflower. Fortunately frost stayed away and only a small percentage of the vegetation was affected by the cold weather. Approximately 66% of the planned grain hectares were planted in the Suidwes region. Better conditions in the eastern parts of the country are promising and a relatively large maize crop is imminent. This still places downward pressure on prices and deprive farmers of desperate financial relief.PAGETWELVE

The record crop resulted in Suidwes receiving a total of Suidwes’ commitment to its members and the community 1,3 million tons of grain. Various silos were under pressure is evident everywhere. Suidwes’ involvement with schools,and despite the fact that additional storage space (such as addressing problems such as roads, safety, electricity, etceterabunkers and silo depots) were established, more than 211,000 is testimony hereof. It is as important for Suidwes as thetons of maize had to be transported to other storage points to rest of the community that these problems are adequatelyensure that our members were not inconvenienced. addressed. In collaboration we have the power to do so much more. To enhance cohesion, an Ambassadors Club wasAgrifriend Equipment experienced a very difficult year. The launched which includes all levels of management and theswitch to the CASE brand, the depletion of New Holland board. One of the objectives of the Club is to reach out tostock, the merger of Suidwes’ Mechanisation Division organisations and institutions in towns to collectively addressand Agrifriend Equipment, as well as the change in the challenges in our area.management and systems, posed much bigger challengesthan anticipated. The lack of disposable income also resulted The board approved a revised and updated strategic plan,in less sales of new equipment, whilst lower exchange rates which was developed involving all managers to ensure thattriggered new equipment being imported at lower prices. broad ownership is achieved. I am encouraged by the way inThis diminished the used equipment market nationally. As a which compassion, loyalty and commitment are introducedconsequence Agrifriend Equipment posed a loss before tax through business affairs. Suidwes is positioned for growth andof R48,53 million. A turn-around strategy was approved to I have full confidence that management and the Board willimprove Agrifriend Equipments’ financial position. take Suidwes to destined heights.Affairs on the political and economic front seesawed daily. Suidwes will continue to support its farmers who, dueDegradations in business interests placed a huge damper to deteriorating climatic conditions, are under immenseon the economy, following the mismanagement of the financial pressure. We will initiate the necessary discussionsZuma administration. With President Zuma’s resignation and in this regard.President Ramaphosa’s election, circumstances changedrapidly and improved domestic and international business After a year jam-packed full of challenges where majorinterests. The R/$ exchange rate strengthened and further fluctuations took place in management, the switch to thedegradations were avoided. The biggest shock for agriculture CASE trademark and the implementation of a new ERPfollowed when Parliament supported the EFF’s proposal that management system, SYSPRO, it is indeed a privilege toland expropriation without compensation be investigated. thank everyone who is part of the Suidwes family for the roleThis lead to universal debates and Suidwes also made a that they played to make Suidwes such a remarkable success.submission in this regard, due to the anticipated financial Every step is a step in the right direction. I am extremelyimpact on Suidwes and its members. At this stage it seems excited and positive about Suidwes’ future.as if discussions have progressed realistically and that theentrance of international role-players can roll the dice to acertain degree. It is, however, quite clear that the playing fieldwill change drastically in time.Emotions continue to run high on the political front which JJ Viljoencause uncertainty and inevitable lower investment in CHAIRPERSON OF THE SUIDWES GROUPagriculture. The economic pressure results in more farmers BOARD OF DIRECTORSleaving the agricultural scene which, in turn, placed evenmore pressure on how agricultural businesses, such asSuidwes, will operate in future. It is imperative that, following24 years after 1994, stability is achieved in the political arena.It is equally important that organised agriculture on all levelswill harmoniously work together to collectively submit asingle message and to take action in the best interests of theagricultural sector. Whether current structures and bodies stillstrive towards the objectives of agriculture in the best waypossible, requires self reflection.Notwithstanding the economic and political circumstancesdescribed above, Suidwes achieved a profit after tax beforeNet Incentive Rebates and Deferred PaymentScheme, from continuing operations attributableto the shareholders of the holding companyto the amount of R56,35 million (2017:R0,35 million). The Retail and AgrifriendEquipment divisions portrayed losseswhile the AgriCapital (Finance) and Graindivisions achieved lower than expectedprofits. Detail focus is given to all aspectsand management is hard at work to takeSuidwes’ achievement to higher levels. Thisincludes, inter alia, that processes, systemsand management are equipped and improvedwith distinct plans. 13 CHAIRPERSON’S REPORT

MANAGING DIRECTOR’S Dr. HD van Schalkwyk REPORT Despite many challenges on economic and political fronts as well as environmental factors, Suidwes experienced a relatively good year. The Group realised a profit of R56,3 million from continuing operations before the Net Incentive Rebates and Deferred Payment Scheme after tax for the year 30 April 2018 (2017: R0,35 million loss). Gross Incentive Rebates and Deferred Payment Scheme to the amount of R9,70 million (2017: R17,38 million) were declared. The lower than expected achievement is mainly due to the loss in Agrifriend Equipment and lower than expected achievements by the Retail, Grain and AgriCapital divisions. The profit after tax of R42,7 million, attributable to the shareholders of the holding company, is directly attributable to the following segments of Suidwes Group’s businesses: Segment 2017 2018 Corporate R’000 R’000 Financing and Investments (58,92) (57,40) Grain 45,88 71,87 Retail 47,17 (47,02) Technology 5,96 2,25 Total 2,56 6,15 42,65 (24,15)PAGEFOURTEEN

GRAIN The Grain Division delivered a substantially better financial result compared to the previous year. This was made possible by favourable climate conditions experienced during the first two months of 2017and resulted in extraordinary good maize production. However, sunflower productionwas disappointing because climate conditions were conducive to the outbreak of fungusdiseases. Maize prices tended towards export parity because of the record harvest ofapproximately 16,820 million ton nationally.Fierce competition was experienced in the market and resulted in the Grain Division’s marginsbeing placed under tremendous pressure. The division realised R47,17 million during the 2017/2018financial year before tax, as compared to R47,02 million in the previous financial year.The total grain received were approximately 57% more than in the previous year and approximately 27% more than theaverage in the previous five years. The higher profit was made possible by the larger harvest, market expansion, more futuresmarket transactions, profit-taking on gap differences and bigger premiums earned in the cash market despite the biggerharvest.Competition, a smaller demand for buyer financing and additional transport costs incurred to manage silo capacity, resultedin a smaller profit than expected. AFRICUM MILLSAfricum Mills posed a profit of R0,89 million in the 2017/2018 financial year, as compared to a lossbefore tax of R2,03 million in the previous financial year. The positive deviation is primarily due to amore favourable and stable market environment in terms of the maize price, as well as more effectivemarketing strategies. Exchange milling and the marketing of Maatla meal by the Suidwes Retail branches is still thebiggest focus of the mill. The mill was upgraded during the past year and adjusted to ensure constant product quality, toprovide the full range of maize products and to produce larger volumes at competitive prices. The mill is already deliveringa positive contribution to Suidwes and is furthermore adding value to shareholders and producers. AGRICAPITAL AgriCapital realised a profit before tax of R10,73 million for the 2017/2018 financial year, as compared to R28,12 million in the previous financial year. The main reason for the deviation is higher bad debt provisions due to the climatic and economic circumstances during the past few years.The debtors’ book amounted to R4,3 billion on 30 April 2018, as compared to 2017’s R4,07 billion. At year end, approvedcredit facilities of R330 million had not been drawn. Carry-over debt amounted to R204 million, compared to R188 millionin 2017.Provision for possible bad debt amounting to R35 million is in place, compared to R27 million in 2017. Total provision for bad debt amounts to 0.8% of the debtors’ book. Products that have been developed over the years have made it possible for AgriCapital to accommodate most of the clients after the difficult conditions during previous years. The sale of the debtors’ book to Landbank (refer to 2013/2014 financial year) has offered AgriCapital the opportunity to significantly lower its concentration risk. Financing is provided in seven of the nine provinces, namely North West, Free State, Mpumalanga, Limpopo, Northern Cape, KwaZulu-Natal and Gauteng. The area is served from eleven offices. Financing clients all share in Suidwes’ incentive rebates – this expanded Suidwes’ shareholders profile. The purpose of AgriCapital is to serve as the preferred financing partner of the farmer and a “Private Banker” concept has already been established. 15 MANAGING DIRECTOR’S REPORT

RETAIL Suidwes Retail realised a loss before tax of R4,49 million in the 2017/2018 financial year, compared to a loss of R2,66 million in the previous financial year. Suidwes Retail is still under pressure, especially as a result of the low maize price and late rain that resulted in producers cultivating less crops than before, giving rise to direct business still being under pressure. The livestock herds are recovering and retail oulets are gaining good growth. New product ranges are constantly being investigated and existing ranges are regularly expanded to meet the needs of clients and to remain competitive in the market. It is thus extremely important to establish partnerships with suppliers that will be to the benefit of the company in future. The objective is maintaining a strong position in all markets where Suidwes Retail is involved. The reason for Suidwes Retail’s business existence is our customer relationships. These relationships are established and maintained by our ability to satisfy the needs of customers and find solutions to their problems. In an effort to fulfil the above-mentioned role effectively and competitively, it is essential that employees have the necessary leadership qualities and skills. Stock ranges are placed under a magnifying glass to be competitive with prices in every town for the benefit of our customers.. Suidwes Retail also focuses on product ranges outside agriculture which mitigates the risk of seasonal purchases only. Suidwes Retail has undergone several personnel changes during the past year. Competent marketing-oriented personnel were appointed. Our employees remain our most important asset and the team is positive and full of enthusiasm. The challenges with the switch to the new SYSPRO system is managed with competence and diligence. MECHANISATION / AGRIFRIEND EQUIPMENT PROPRIETARY LIMITED Agrifriend Equipment posed a loss before tax of R16,16 million, as compared to a loss of R4,67 million in the previous financial year. This loss was caused by the switch to the CASE trademark, the lower demand for mechanisation equipment, the temporary higher costs following the merger with Agrifriend Equipment and Suidwes Mechanisation, and the change in management. Suidwes Mechanisation and Agrifriend Equipment were consolidated within Agrifriend Equipment Proprietary Limited during the past year. The objective is to utilise the scale benefits and bigger presentation of products, as well as to present a more competitive and profitable mechanisation division for producers and shareholders. This process entailed that all personnel and systems within Agrifriend Equipment were consolidated which precludes the overlapping and duplication of costs. The decision to switch over to the CASE trademark was concluded this year. Spare parts oulets were placed within the retail branches as far as possible and a specialist workshop for combines was established in Hoopstad. The difficult agricultural conditions during the past three years have continued against expectations and producers were reluctant to purchase new equipment. Nevertheless, the business achieved a growth of 7% in turnover. However, margins are still under pressure. The sales of used equipment is slow and this contributes to higher levels of inventory. The hours sold by workshops have improved, although the costs of workshops still remain high. A larger turnover is needed to bring workshops to an acceptable profit level. Targets for the spare parts division were achieved. Problems regarding purchases on production accounts were resolved. This section of the business’ prospects looks positive and can provide a larger contribution to the business.PAGESIXTEEN

Overall performance of the business is weaker than expected due to the slower pace ofcost-saving initiatives and higher costs associated with the merger, trademark change, andinventory. Policy adjustments regarding bad debt provisions also had a significant once-offimpact.Mr. Jannie Louw resigned as CEO: Agrifriend and was succeeded by Mr. Pieter van Zyl whowas employed on 2 July 2018. We look forward to the positive contributions that Mr. van Zylcan make with his knowledge of the industry.Suidwes Agriculture always strives to fulfil the needs of our clients and their support to succeedin this goal is of major importance. AGRINET PROPRIETARY LIMITED Agrinet is a modern, dynamic wholesale business and since its establishment some 69 years ago, has continuously focused on providing clients with solutions in an ever-changing and extremely dynamic market environment. The strategic vision “to be a unique, solution- driven distribution channel of choice in Africa for its product offering”, remains the standard to which all activities are measured and whereby strategic investments can be made. Agrinet can be seen as a “house of brands” with a unique composition of trademarks and products that make the company a leader in the agricultural and industrial wholesale environment. A comprehensive range of products are housed with approximately 16,000 line items that are constantly revised for relevance and development purposes. Agrinet has an extensive fleet of vehicles that provide a delivery service countrywide. Local and international events, as well as exchange rates and accompanying policies, have an obvious influence on the stability of South Africa’s business environment that influences the daily management of enterprises. Despite the difficult economic conditions that prevailed during the past financial year, Agrinet succeeded in continuing to build on the good financial achievement of the past year and, in doing so, provided an acceptable return to its shareholders. The ability to successfully execute a strategy is determined by the quality, skills, competency and experience of personnel, as well as our leaders’ ability to empower personnel to be successful. Several initiatives were implemented to address the continuous improvement of talent and internal resources. Amongst others, these initiatives include formal apprenticeships, as well as internal and external training. Expenditure is strictly managed and the optimal management of balance sheets remains a focus area. Agrinet is excellently positioned to be profitable, even during unfavourable economic times. After strong growth during the past four years, Agrinetcurrently focuses on the consolidation of operations by means of effectiveprocesses, trademark development and optimising the marketing channel.A renewed focus is currently placed on optimising the Bellville operationsand the development of a new and bigger warehouse is already in its firstphase. The extensions are focused on offering a better and extended clientservice, as well as adding value for clients’ current business. It forms part ofthe broad strategic objective to strive to improve service delivery to clients. 17 MANAGING DIRECTOR’S REPORT

NVIROTEK LABORATORIES PROPRIETARY LIMITED The 2017/2018 financial year was an exciting period for the company. Medium term strategic goals were realised within this year by the purchasing of a 80% share in Wynland Laboratory, as well as the establishment of a new organic division that will focus on testing for residues of agricultural chemicals on fresh products. The product offering is hereby increased considerably, especially because Wynland Laboratory specialises in microbiological analyses of processed products. The geographical footprint of the company is also extended, since Wynland Laboratory is situated in Wellington in the Western Cape. This lead to capital expenditure being exceptionally high, while the routine replacement and upgrading of the laboratory equipment and computers also received attention. The company showed an exceptional profit in comparison to the previous years. This is generated from an increased turnover from analyses of soil samples of which the volumes were approximately 50% more than the previous year. The profit figure was supplemented with the profit achieved by Wynland Laboratory during the last six months. The nett profit percentage for the year has slightly decreased to 28.3% in the 2017/2018 financial year (29.4% in 2016/2017). The decrease in the nett profit percentage, in spite of strict cost management, is attributable to prices and margins that still remain under pressure. The focus for the coming year is to attain international accreditation that will be finalised during the first quarter of the new financial year, the marketing of residue analyses, as well as the optimising of cooperation between NviroTek and Wynland Laboratory. PE-BEE AGRI PROPRIETARY LIMITED (PROTEK) Despite retail sales that were under pressure countrywide, the unsteady climate patterns, as well as the impact of the drought in the Cape, Protek succeeded to increase its turnover by 13.7%. Nett profit before tax displayed a growth of 11.7% compared to the previous year. Protek once again experienced an increased market share as a result of the effective service delivery to distribution partners, the roll out of new and unique products, as well as a change in packaging and packaging sizes of existing products and the continuous establishment of new sales and distribution channels. From the Members, For the MembersPAGEEIGHTEen

RADDIX GROUP PROPRIETARY LIMITEDThe company realised a R0,37 million profit before tax for the 2017/2018 financial year, compared toR0,53 million in the previous financial year.Ongoing regulatory changes had a significant impact on the insurance industry and as a registered financial servicesprovider Raddix was also influenced by this. The impact of the changes on regulatory level resulted in Raddix outsourcingits compliance function to an external party in the 2017/2018 financial year. More clarity is expected in the new financialyear from insurers regarding their position on administrative functions that are outsourced to Raddix. The process offurther product development will also gain momentum after more clarity is received from the regulator and when insurersimplement their respective strategies regarding the outsourcing of administrative functions to financial services providers.Raddix’s financial planning department was further expanded and close integration was established with three key areasin the Group, namely financial planning, medical funds and credit life insurance. This initial integration will gain moremomentum in the 2018/2019 financial year by the systematic implementation of the investment function in the Group afterthe initial three focus areas have achieved a level of economy of scale.Short-term insurance is still the core business of Raddix and a firm focus is targeted towards the expansion of the marketshare of Raddix in cooperation with Suidwes Agriculture.The unique value proposition of Raddix to protect and extend the role of quality advice in South Africa, is becoming moreand more valuable against significant regulatory changes on the legislative horizon. Further extension of the concessionmodel of Raddix is a future prospect, after more clarity obtained about the future of the application of regulation in theindustry. BOTSELO MILLSThe Suidwes Group acquired a 34.9% interest in Botselo Mills. Botselo Mills operates in an extremelycompetitive market environment where additional milling capacity is continuously being created on anational basis. Nevertheless, Botselo Mills’ volumes increased with 11.9% during the 2017/2018 financialyear. This tendency of systematic growth is a goal which is constantly strived towards.A satisfactory 12% yield on Suidwes’ investment was realised for the year. Another positive development is the constructionof a new plant that will add further value to the production of mealie meal. The project has already progressed a great dealand the plant should be in production by September 2018. Instant mealie meal with the trademark “Super White InstantPorridge” will then be available on the market. TERRATEKWith the continuous changes and challenges with which Suidwes’ shareholders and clients areconfronted, it was decided to place a renewed focus on agricultural advisory services by extendingTerratek’s services. The strategic approach is not to set up all the expertise in-house, but to establish the coreexpertise according to the most prominent production and farming practices in the Suidwes operational area. Additionalexpertise is obtained by means of cooperation agreements with other market leaders in certain specialist areas.Terratek offers a wide range of professional services in several disciplines that includes soil science, agronomy, hortology,livestock science, agricultural economy, agricultural engineering services and GIS (Geographical Information Systems). Theprimary focus still remains on a multi- and interdisciplinary approach, given the interdependence of the various expertisedisciplines insofar as agriculture and the agricultural environment are concerned. The extent to which producers use Terratek’sservices is a definite indication of the need and value that is coupled with independent agricultural advisory services. 19 MANAGING DIRECTOR’S REPORT

IN CONCLUSION The 2017/2018 financial year certainly brought its own unique challenges. The biggest of these was the implementationof Suidwes’ new operating system, SYSPRO. As with theimplementation of any new system, it is accompanied bygrowing pains and many challenges. However, challengesare reduced and the system is functioning well. It is alreadypossible to retrieve information from the system, which washardly ever possible before. This management informationmakes it possible to manage more effectively and betterdirect the business. I thank everyone who are assisting tomake this project a huge success and for the patience thatour members displayed during the implementation of thesystem.Several changes were executed on executive managementlevel. Mr. Rocky le Roux was appointed in Mr. PatrickNelissen’s place as the new CEO for Retail, while Mr. Nelissenwas transferred to IT to see to it that SYSPRO is properlyimplemented. Mr. Aubrey Marais was appointed as the newCEO at AgriCapital and Mr. Pieter van Zyl as new CEO atAgrifriend, following the resignation of Mr. Jannie Louw.These management changes bring their own challenges,but also new energy, thoughts and expertise that directs thebusiness to a whole new level.Although Suidwes realised a lower than expected profit,the business still performed relatively well under thesecircumstances. What’s important is that the personnel, thesystems and the resources were upgraded and can nowfunction on a much higher level.With the optimising of the systems and effectivemanagement, Suidwes will perform better. The Suidwesteam is better equipped and guided to accomplish this.I thank the personnel, management and the board ofSuidwes for their support and loyalty towards Suidwes andits staff in the past financial year.The commitment of Suidwes and its people is reflected intheir involvement in the different communities where weoperate. In these times where poor service delivery andinstability on the political front is rife, it is important that thecooperative culture of the past, that is inherently an integralpart of Suidwes, is reborn. It is only via cooperation that thesechallenges can be overcome and a sustainable countryside,that makes a significant contribution to the economy, willbe kept intact. It is also against this backdrop that Suidwesdecided to get involved in the debate about land reform.Suidwes is 109 years old. For a business to survive that long,is indeed a marvellous achievement. It can only be pursuedin future if the interdependence between Suidwes and itsmembers is acknowledged and extended. It is our focus tolet this relationship grow and prosper.Dr. HD van SchalkwykSuidwes Group Chief Executive OfficerPAGETWENTY

CORPORATEGOVERNANCE REPORT 2Mandtahyeraftiihneeltdihctssleoogfuafedrnysmtoloeuofrrfjaodyiyneosdutarirnopypplisr.foeo,anctho vimrod 21

COMPOSITION The Suidwes Group remains committed to maintaining and promoting good corporate management practices. In this regard, the Group strives to adhere to the guidelines of the recently accepted King IV Report.INDEPENDENCE Board of Directors The board of directors of Suidwes Holdings (RF) Proprietary Limited (“Suidwes Holdings”) comprises of a majority of non-executive directors who are elected by shareholders on the ward principle and who retire after three years on a rotation basis in accordance with applicable statutory stipulations. The two executive directors, namely the managing and financial directors, are appointed by the non-executive directors. The respective boards of directors of Suidwes Investments Proprietary Limited (“Suidwes Investments”), Suidwes Agriculture Proprietary Limited (“Suidwes Agriculture”) and Africum Limited (“Africum”) comprise of the same directors as Suidwes Holdings. None of the non-executive directors of the Suidwes Group have an employment contract with any company in the Group. It is, however, expected of non-executive directors to enter into a directors’ contract with the Company. This contract prescribes aspects relating to their responsibilities under the King IV report, their obligations regarding the ethical code of conduct, conflict of interest, confidentiality, attendance of meetings, remuneration of directors and performance appraisal. The composition of the mentioned boards of directors, as on 30 April 2018, is indicated in the respective directors’ reports of the companies. No director has been disqualified or declared incompetent to fulfil the position, as stipulated by the Companies Act (2008). The independence of the board of directors in relation to executive management is ensured by the following guidelines: • The chairperson of the board of directors has no executive functions and the roles of the chairperson and Managing Director (Chief Executive Officer) are separate. • With the exception of the Managing Director and the Director: Finance (Chief Financial Officer), the board of directors comprises only of non-executive directors who are all independent. The remuneration of non-executive directors is not linked to the Group’s financial performance. • The composition of the Audit, Risk and IT Committee is done in accordance with the stipulations of the Companies Act (2008) and the King IV guidelines. • The chairpersons and majority of members of the committees of the board of directors are non-executive directors. • No individual has unlimited decision-making powers. • All the directors have unrestricted access to the advice and services of the Group Secretary (Group Chief Legal Officer) and to all information, records, documents and property of the Group. The directors are also entitled to seek independent professional advice relating to the operations of the Group. PAGETWENTY-TWO

ROLE AND FUNCTION The board of directors are responsible for the oversight, control and strategy of the Group, which includes the following: • Determining and reconsidering the Group’s strategy; • Approving budgets and real capital expenses; • Monitoring operating results against budgets; • Evaluating the financial standing of the Group; and • Evaluating the performance of executive management. Decision-making about all matters of material importance and effective control over the Group, as well as ultimate responsibility for it, rests with the board of directors. Operational decision-making, exclusive of certain powers, has been delegated to the Managing Director in accordance with a formal policy for the Delegation of Decision-making Authority. The Managing Director furthermore delegates certain operational powers to the executive management. The Delegation of Decision-making Authority is administered centrally by the Secretariat and establishes the principle that responsibility goes hand-in-hand with delegated authority. Newly appointed directors are comprehensively informed about the Group’s functioning, activities and achievements by means of a formal orientation process, in order for them to be capable of functioning optimally as quickly as possible.REMUNERATION The directors’ remuneration consists of the following MEETINGS The board of directors meet at least four times three components: a year. Additional meetings are scheduled as the need arises. Directors are at liberty to • A fixed annual honorarium that is recommended propose items for inclusion in the agendas by the Social, Ethics and Remuneration Committee of these meetings and frank discussions of all and approved by the shareholders at the Annual matters are encouraged. The board of directors’ General Meeting. Remuneration is paid quarterly; need for information has been clearly defined. Agendas of meetings and applicable proposals • Remuneration per kilometre for official trips, based are provided to the directors beforehand and in on AA rates; and good time, in order for them to have sufficient time to prepare themselves thoroughly. • A daily allowance for time and expenses related to official business of the Group.ATTENDANCE OF MEETINGS Attendance of meetings – DATE OF MEETING May 2017 to April 2018 13/07/2017 24/08/2017* 29/11/2017 02/02/2018* 26/02/2018* 14/03/2018 26/04/2018 Viljoen JJ (Chairperson) P PPPPPP Marx FE (Deputy Chairperson) P PPPPPP Botha A P PPPPPP Delport PF P APPPPP Geldenhuys GT P APPPAP Le Roux JJ P PPPPPP Malherbe GL P PPPPPP Mathews B P PPPPPP Potgieter G (Director: Finance) (Group Chief Financial Officer) P PPPPPP Van Schalkwyk HD Dr. (Managing Director) (Group Chief Executive Officer) P PPPPPP (* Special meeting of the board of directors; P = Present; A = Absent with apology) 23 CORPORATE GOVERNANCE REPORT

COMMITTEES OF THE BOARD OF DIRECTORS The committees of the board of directors mentioned below were instituted to assist the board of directors to execute its collective responsibility for corporate management and risks. The board of directors acknowledges its ultimate responsibility for the actions of its committees and is satisfied that the committees executed their responsibilities effectively during the year under review. Minutes and agendas of all meetings of the committees are circulated to all the directors. AUDIT, RISK AND IT COMMITTEE The Committee’s composition was as follows on 30 April 2018: Statutory members Non-statutory members Ms. B Mathews (Chairperson) Mr. G Potgieter Messrs. JJ Viljoen (Director: Finance – ex officio) FE Marx Dr. HD van Schalkwyk A Botha (Managing Director - ex officio) PF Delport GT Geldenhuys JJ Le Roux GL Malherbe The report of the Audit, Risk and IT Committee, in accordance with Section 94(7) of the Companies Act, Act No. 71 of 2008 for the 2017/2018 financial year is published on page 47 of this report. SOCIAL, ETHICS AND REMUNERATION COMMITTEE The Committee’s composition was as follows on 30 April 2018: Statutory members Non-statutory members Messrs. PF Delport (Chairperson) Mr. G Potgieter JJ Viljoen (Director: Finance – ex officio) FE Marx Dr. HD van Schalkwyk A Botha (Managing Director - ex officio) GT Geldenhuys JJ Le Roux GL Malherbe Ms. B Mathews The main functions and capabilities of the committee are the following: • To research, on policy level, the financial composition and the effect of remuneration of directors and chief executive officers on the total remuneration basket of Suidwes and to present proposals in this regard for consideration to the board of directors; • To reconsider and approve the remuneration of directors and executive management annually and to ensure that the composition of their remuneration is market-related, competitive and proactive, and includes an incentive component; • To present guidelines for general annual increments for staff; • To present recommendations to the board of directors about the way to report to shareholders about the remuneration policy and individual remuneration and to ensure that the necessary decisions about remuneration of directors are obtained from shareholders. • Given the necessity in the light of a dynamic business environment, toPAGETWENTY-Four

EXECUTIVE recruit suitable directors and chief executive officers to conduct research on Itth’se fmroemmbtehres m-efmorbeevresr, for MANAGEMENT requirements and criteria and to propose guidelines that will contribute to the best possible candidates being identified for Suidwes’ recruitment actions; • To identify suitable candidates for appointment as independent, non-executive directors, to interview them and to offer recommendations for appointment to the board of directors; • To make recommendations to the board of directors about the composition of the board of directors in general and with regard to particular requirements and expertise; • To assist the chairperson of the board of directors, to assess the operation of the board of directors and its committees and to evaluate individual directors; • To conduct preliminary interviews with candidates for appointment as Managing Director, Director: Finance and a member of the executive management and to present the board of directors with a shortlist; • To ensure that succession planning with regard to executive directors and chief executive officers takes place; • To consider whether the Group is meeting its social responsibility obligations; • To ensure that the business activities of the Suidwes Group are conducted according to ethical and sustainable principles in accordance with the King IV guidelines and the Group’s ethical code of conduct; • To ensure compliance with the Company’s corporate management requirements and legislation, particularly complying with laws and regulations applicable to the Company and King IV stipulations; • To compile, revise and monitor policies that apply to the Group’s human resources; • To appraise the performance of the executive directors; • To develop incentive schemes and to exercise control over them to include performance-related elements in the remuneration system; • To ensure statutory compliance with labour legislation; • To advise the board of directors regarding black economic empowerment; • To make recommendations to the board of directors about focused training and development of staff, retrenchment programmes and the Group’s appointment policies; • To appraise the annual review of the applicability of the Group’s performance appraisal systems; and • To ensure that succession planning for the Group receives the necessary attention. The Social, Ethics and Remuneration Committee meets at least twice a year. The Managing Director fulfils the role of Chief Executive Officer. The executive management is responsible for the day-to-day management of the business of the Suidwes Group. The members of the executive management attend meetings of the board of directors and committees. Every subsidiary company has its own board of directors on which the members of the executive management serve. Every subsidiary is therefore managed by its own board of directors in the best possible interest of the relevant company, although emphasis is placed on synergies and benefits that can be achieved by utilising shared services on group level. 25 CORPORATE GOVERNANCE REPORT

INTERNAL AUDITThe function of internal audit of the Suidwes Group is executed internally by independent staff. The internal audit function isexecuted independently in accordance with a particular mandate of the Audit, Risk and IT Committee. The internal auditorsreport to the Audit, Risk and IT Committee and have direct and unrestricted access to the chair of the Committee. They enjoythe full support and cooperation of both the board of directors and management of all divisions of the Group.The main duty and goal of the internal auditors are to assist the Group to identify operational risks, to conduct an independentevaluation of compliance with Group policy, risk control measures, internal control systems, procedures and accountingpractices and, where necessary, to make recommendations for its improvement.The internal auditors coordinate their work with others as required by management. The external auditors are informed aboutthe activities of internal audit to lessen the duplication of audit attempts and all the relevant reports, where necessary, arecirculated to them. RISK MANAGEMENTIdentifying, evaluating and managing material risks facing the Group is an ongoing process. The board of directors accepts fullresponsibility for the total process of risk management in the Group and is assisted by the Audit, Risk and IT Committee, theexternal auditors and the internal auditors, and by management reporting about the design, implementation and monitoringof risk management processes. The effectiveness of the internal control systems is checked regularly.The objective of the risk management process is ensuring that the Group’s assets and investments are safe, that management’sgoals and sustainability are supported by the risk management process under all operating conditions and that Suidwes actsin a responsible manner in relation to its interest groups.The Group follows a comprehensive Risk Management Policy and Implementation Plan, approved by the board under guidanceof the Group Chief Legal Officer who fulfils the role of Risk Manager in the Suidwes Group. COMPLIANCEA dedicated Compliance Officer is responsible for complying to legislation and regulatory requirements within the SuidwesGroup. The officer reports to the Group Chief Legal Officer. The aforementioned is responsible for management and reportingwithin Suidwes regarding compliance on corporate level, but the divisional managers carry the responsibility for complianceon divisional level.The board of directors annually approve a comprehensive Compliance Plan that identifies certain legislation and regulatoryrequirements for compliance verification purposes. The Compliance Officer reports annually to the board of directors regardingcompliance (or the lack of it) as identified in the Compliance Plan, thus prioritising assurance to the board.. Any cases of non-compliance are pointed out and followed up by appropriate corrective measures. No contraventions of any laws or regulatorydirectives of any kind were reported by any authority during the year. ETHICS CODESuidwes remains committed to maintaining the highest standards of integrity and ethical principles in its interaction with allinterested parties. Professional behaviour, integrity and an uncompromising attitude, which requires business ethics of thehighest standards, form the core of the existing code of ethics.The directors, who are the guardians of integrity within Suidwes, ensure that ethical performance is monitored and reportedand declared to the Social, Ethics and Remuneration Committee.Several platforms have been created for reporting fraud and unacceptable behaviour in Suidwes, including a toll-free reportingnumber, which offers an opportunity for anonymous reporting of unethical behaviour and which ensures the protection of awhistle-blower’s identity.Management is satisfied that adequate grievance and disciplinary procedures exist to ensure the application and promotion ofPAGETWENTY-SIX

the code of ethics. Should employees participate in questionable ethical behaviour, Suidwes’ view is clearly that it will, withoutexception, act relentlessly against the employees involved. Employees who are found guilty during a disciplinary process areusually dismissed and if dishonesty is involved in the case, a complaint is made to the South African Police Service.During interaction with customers, suppliers and/or intermediaries, employees may not receive money, favours and/or gifts ofvalue. A formal policy that regulates the giving and receiving of gifts has been approved and will serve as a guide to staff in theirinteraction with interested parties.Employees may not become involved with other interests if this involvement will, in any way, stand in the way of properexecution of their duties or Suidwes’ business.INFORMATION TECHNOLOGY MANAGEMENT (IT)Suidwes uses information technology to optimise its business processes and execute them more effectively. During the pastdecade Suidwes has used a computer network that can function independently of any third parties. The network, with itsavailability of 99.5%, enables Suidwes to utilise its operational centra optimally. Further effectiveness and savings are madepossible by a central printing system, which facilitates the management of printing.During the year under review, the new SYSPRO software system was implemented. This system creates exciting prospects foreffective system control within the divisions and accompanying benefits and cost savings.Furthermore, Suidwes has developed the Suidwes App for its members and clients that enables them to access importantinformation such as grain stocks and account information via their cellphones or tablets.It is a priority for Suidwes to ensure that the information that is stored on the computer systems and networks are safeguardedby the latest technology. A lot of time and effort are invested to ensure that information does not increase risk due to virusesor cyber-crime events.GROUP SECRETARIATThe Group Chief Legal Officer fulfils the role of Group Secretary and complies with requirements prescribed by Section 86of the Companies Act (2008). The Group Secretary manages the legal and other support functions of the Group, providesguidance and advice to the directors with regard to their authority, duties and responsibilities and ensures that the board ofdirectors and the Group comply with all relevant legislation, as well as with stipulations of individual statutes.The Group Secretary is responsible for maintaining and administering proper minutes of all meetings of shareholders, boardsof directors and committees of the board of directors in accordance with the stipulations of the Companies Act, includingmeetings of the executive management.CLOSED PERIOD FOR SHARE TRANSACTIONSThe Company maintains a closed period before the publication of annual and interim results in accordance with a policy thatis prescribed by the board of directors. During a closed period, no director, official or employee of the Group may enter intoany transaction that relates to shares of Suidwes Holdings. The board of directors has enforced a policy about insider tradingto ensure that transactions involving shares in the Group by directors, officials and staff take place in a transparent manner. 27 CORPORATE GOVERNANCE REPORT

Lord bless the land You’ve given me, and may I always know You’re the One who helps them grow. R o b i n F o gl e 3 SUSTAINABILITY REPORTPAGETWENTY-EIGHT

SUSTAINABILITY REPORTSOCIAL INVOLVEMENTSuidwes’ impact in the communities in which we conduct if everyone takes hands can the sustainability of rural areasbusiness is the result of our dedicated and involved staff. Only be ensured.Sponsorships and donationsCommunity involvement and support is one of the avenues • Young farmers’ days for the youth; andthat Suidwes Agriculture uses to plough back to our clients • Community festivals.and our members. The total investment on communityinvolvement increased by R400,000 to R1,221 million, which Suidwes has identified a need by schools in the communitiesinter alia, includes the following: in which we operate, because of declining government aid to schools. As previously, Suidwes has taken the initiative to• Educational institutions (schools); organise a school principals’ day where the needs of schools• Community projects; were discussed. Suidwes also confirmed its current five• Farmers’ days for farm owners, farm managers, year sponsorship to participating schools. This sponsorship entails the provision of sportswear and equipment, as well as emerging farmers and farm workers; contributing financially to every school.• Ladies’ mornings;• Drought-relief projects and donations;Suidwes Agriculture sponsors sportswear of 31 schools in the area it serves. Here the The netball team of Stella Combined School receiving their sportswear. Combined School in Bloemhof proudly receives their sponsored rugby jerseys. Suidwes Agriculture hosted a successful school sports day in The Delmas High School also received their rugby jerseys sponsored by Suidwes.Wolmaransstad where 18 teams participated from the area in 29 which Suidwes operates. SUSTAINABILITY REPORT

EXTERNAL FOCUSInformation and demonstration daysRenewal and change take place continuously. That’s why it’s vital for producers to stay informedabout new farming tendencies, mechanisation methods as well as political and economicchallenges. The following information days were initiated by Suidwes: Place Attendance Guest SpeakersWolmaransstadInformation Day 110 producers Mr. Theo Boshoff – Agbiz Dr. Herman van Schalkwyk – Suidwes AgricultureSchweizer-Reneke 80 producers Mr. Jan Grobbelaar – Suidwes AgricultureInformation Day Mr. Johan Jordaan - Terratek 60 producersKameel Information Day Mr. Theo Venter - NWU Hoopstad – 45 producers Dr. Herman van Schalkwyk – Suidwes AgricultureCASE Presentations Bothaville – 120 producers Mr. Jan Grobbelaar – Suidwes Agricultureand demonstrations Wolmaransstad – 120 producers Mr. Johan Jordaan - Terratek Schweizer-Reneke – 140 producersMakwassie Kimberley – 220 producers Prof. André Duvenhage - NWULivestock Information Day 40 producers Dr. Herman van Schalkwyk – Suidwes Agriculture Mr. Jan Grobbelaar – Suidwes Agriculture Mr. Johan Jordaan - Terratek Mr. Johan van der Merwe – Northmec Dr. Herman van Schalkwyk – Suidwes Agriculture Mr. Jannie Louw – Agrifriend Equipment Product Providers and Cattle Breed JudgesProducers listen attentively to Jan Grobbelaar, Employees of Agrifriend Equipment demonstrated Suidwes acknowledges its suppliers at a Suppliers’CEO: Suidwes Grain, at the information day in CASE equipment at the annual Migdol Farmers’ Day. Golf Day and Recognition Evening at the Orkney Golf Wolmaransstad. Club. Agrinet was chosen as the Supplier for 2017.Suidwes Young Farmers’ Day to different agricultural fields. The Young Farmers’ days were held in Wolmaransstad and Delmas with no less than 320The Suidwes Agriculture Young Farmers’ Day was an learners attending.enormous success when it was hosted for the fourthconsecutive year. The target market is learners aged between11-18 years from all Suidwes communities who are exposed Themes that were addressed: • Nature conservation • Safety and handling of firearms• Mechanisation • Tracking techniques• Sheep shearing demonstration • Preventing veld fires• Start your own vegetable or chicken farm • Career guidance by UFS and NWU• Cattle and sheep breed identification • Agricultural services• Post mortem on livestock• Drones and computer technologyPAGETHIRTY

Suidwes Agriculture’s Young Farmers’ Day in Wolmaransstad Gerrie Lindeque, Branch Manager: Delmas, demonstrateswas attended by 250 learners. Here Dries van der Linde, Snr Silo drone technology. Manager, demonstrates the grain grading process.Suidwes Agriculture Ladies’ Day Communication with clients, members and shareholders280 ladies attended Suidwes Agriculture’s Ladies’ Day thatwas held outside Schweizer-Reneke on 9 September 2017. Suidwes Agriculture regularly communicates withGP van Rheede van Oudshoorn was the master of ceremonies various interest groups via printed media by focusing onwith Alison Botha as guest speaker and Rocco de Villiers as information that addresses current agricultural trendsguest artist. to assist producers to improve their farming practices. Likewise, newsworthy events of the Group are regularly The annual Suidwes Ladies’ Day was attended by 280 ladies. Rocco de provided to local and national printed media, in an Villiers was the guest artist. effort to communicate with interest groups and keep them abreast of what’s happening in the area in which Suidwes operates. Dr. Herman van Schalkwyk uses his newsletter, Uit Herman se Kantoor, to regularly report about company and agricultural matters to Suidwes’ approximately 3,900 shareholders. Ons Eie is a glossy magazine that appears every second month and is distributed to all Suidwes shareholders. It mainly focuses on agricultural affairs, but also serves as a display window of the company.Allison Botha was the motivational speaker at the Suidwes Ladies’ Day Ons Eie – the journal and glossy magazine of Suidwes Agriculture held on 9 September 2017. which appears every second month. 31 SUSTAINABILITY REPORT

Farmers’ Association meetingsManagement strives to annualy attend at least 15 Farmers’ director. Relevant feedback from the company is providedAssociation meetings in the Suidwes operational area. and feedback from clients is also requested.At these occasions, farmers are addressed by Dr. Hermanvan Schalkwyk (Group CEO, Suidwes), Mr. Hansie Viljoen(Chairperson of the Suidwes board), as well as the local wardTop Clients FunctionThe annual Suidwes Top Clients Function was hosted for the fourth consecutive year during an elegant evening held at MonteCasino in Johannesburg. Wynand and Cheree Strydom entertained 120 guests who also thoroughly enjoyed the Evita musicalperformance afterwards. Suidwes Agriculture’s management, board of directors and producers enjoyed each other’s company at the Suidwes Top Clients function held at Monte Casino in Johannesburg.Nampo Agriculture students from UFS visited the A hive of activity at the Suidwes stand at Suidwes stand at the Nampo Harvest Day. Nampo.Every year Suidwes Agriculture isinvolved in Grain SA’s Nampo HarvestDay outside Bothaville. This yearSuidwes Agriculture’s stand onceagain attracted many visitors andsuccessful networks with existingand new clients were formed.Drought-relief projectThe Suidwes Agriculture Drought-Relief Project brought enormous relief to many farmers in the Northern Cape. In collaborationwith farmers’ associations in this drought-stricken area, maize and livestock feed were transported from Christiana to theNorthern Cape and distributed amongst producers.PAGETHIRTY-TWO

Main Sponsor: Agri North West Young Farmer ConferenceSuidwes Agriculture is the main sponsor for Agri North • Mr. Ernest Pringle, Chairperson: Agri SA CentreWest’s Young Farmer Conference from 2018 untill 2020. for Excellence – Land, with the theme: “LandAt the 2018 conference held at the Uurpan Safari Lodge management, government structures and theoutside Schweizer-Reneke, 130 conference attendees impact thereof on farming”.were exposed to the following: The event was concluded with a gala function where• Motivational speaker Gavin Sharples focused on Mr. JP van den Berg was appointed as the North West “Change, innovation & creativity”. Young Farmer of the Year.• Dr. Herman van Schalkwyk led a panel discussion addressing “Optimal management practices and cost-effectiveness in farming”. Speakers at the Agri North West Young Farmer Conference held Mr. JP van den Berg (middle), Agri North West Young Farmer winner foroutside Schweizer-Reneke. Suidwes Agriculture was the main sponsor. 2018, with (fltr) Mr. Gideon van Zyl (Chairperson, Agri North West Young Farmer Committee), Mr. Hansie Viljoen (Chairperson, Suidwes board), Dr. From left to right: Mr. Ernest Pringle, Dr Herman van Schalkwyk, Herman van Schalkwyk (Group CEO, Suidwes Agriculture) and Mr. Louis Messrs. Gavin Sharples, Pierre Vercueil and Gideon van Zyl. Wessels (Vice-Chairperson, Agri North West Young Farmer Committee). Preparations for the Agrifriend/CASE presentation in Bothaville. Agrifriend/CASE presentation functionsApproximately 800 guests attended the five Agrifriend/CASE presentationfunctions held in Hoopstad, Bothaville, Schweizer-Reneke, Wolmaransstadand Kimberley. During each of the functions Messrs. Jannie Louw (Agrifriend), Johan van der Merwe (Northmec), Hansie Viljoen (Chairperson, Suidwes Board) and Dr. Herman van Schalkwyk (CEO: Suidwes) addressed the guests and the musical group, It Takes Four, entertained the guests.Guests having a good time at the Agrifriend/CASE Agrifriend/CASE presentation presentation in Schweizer-Reneke. in Bothaville. 33 SUSTAINABILITY REPORT

Northern Free State and North West Open Veld Shooting Day Suidwes is the main sponsor for the annual Northern Free State and North West Open Veld Shooting Days at Bothaville and Bloemhof. The shooting days were the last qualifying events before the SA Championships early in 2018. These days were attended by 141 marksmen in Bothaville and 149 marksmen in Bloemhof respectively, and should become an annual event. Marksmen eyeing the targets at the North West Open Veld Shooting Competition outside Bloemhof in which 149 marksmen participated.GameX Game Farming and Hunting Expo 2017The Suidwes GameX Game Farming and Hunting Expo and opportunities offered by these specific markets.was held in Vryburg in August 2017. The expo focused on A game auction was also held during the expo andthe game industry, game farmers, hunters, nature lovers approximately 1,800 visitors attended the two-day expo. Some of the exhibitions at the Suidwes GameX Game Farming and Hunting Expo outside Vryburg. The game auction was presented by Andre Kok & Son during the Suidwes GameX Game Farming and Hunting Expo outside Vryburg.PAGETHIRTY-FOUR

Suidwes “Skaalbraai”In the past a special barbeque, the so-called “Skaalbraai”,was held for producers to celebrate the end of harvestand took place at the various silos. Over time the customfaded, but was reintroduced in 2018. Gratitude is herebyshown towards producers for their loyal and devotedsupport during the season. An old custom, the annual “Skaalbraai”, was reintroduced to celebrate the end of harvest. Suidwes Song – “Dis Ons Trots”.This year Suidwes’ very own Afrikaans song was launched that highlights Suidwes’ passion, pride and loyalty towards agriculture andour agricultural producers. These gripping lyrics with a catchy tune are already reverberating everywhere across the Suidwes area: Dis die reuk van die rooi grond, soos die lande bewerk word, Dis die velhoed in die bakkies en die dae om bid oor die droogte, want die reën kan nou maar kom. Ons sal staan soos reuse, dis jou “eerste keuse”, teen wind, teen storms en vir reën. Koor: Al kom die grootste storms oor die vlaktes van die platteland, is Suidwes Landbou altyd aan jou kant. Vir generasies, koöperasies, vertroue word gewen. Deur die jare, groei ons steeds saam. Dis genade uit Sy hand. Dis die platteland – dis ons bloed, ons sweet, ons hartklop. Dis ons trots. Dis die reuk van die rooi grond, wat gesaai sal gemaai word.Met daai groot rooi trekker boer ons lekker, in die Noordwes tot diep in die Vrystaat. Ons sal staan soos reuse, dis jou “eerste keuse” teen wind, teen storms en vir reën. Dis “uit die lede vir die lede” – vir altyd, Dis “uit die lede vir die lede” – vir altyd. Al kom die grootste storms oor die vlaktes van die platteland, is Suidwes Landbou altyd aan jou kant. Vir generasies, koöperasies, vertroue word gewen. Deur die jare, groei ons steeds saam. Dis genade uit Sy hand. Dis die platteland – dis ons bloed, ons sweet, ons hartklop. Dis ons trots! 35 SUSTAINABILITY REPORT

INTERNAL FOCUS Communication with employees Employee and client commitment are the direct results of effective and timely communication. The following communication platforms are used by Suidwes: • Regular management meetings between top management and divisional heads;Skuts • bekyMk odniethtelyikdenivsistiyodnenasl mdieeeNtoinogrwse; s Ope Veldskiet kompetisie buiteBloem• hof wQauaratyrdtenrlsy1M49asnkuatgsedmeeelgnenteIenmdahbeta. ; • Regular sessions about medical and retirement funds; • Annual staff acknowledgement function; • Printed media, for example Ons Eie and Esprit de Corps; • Electronic media such as email, intranet, SMS’s and electronic newsletters; and • Social media such as Facebook, Instagram, Twitter and YouTube. Printed media The newsletter, Uit Herman se Kantoor, is used by Dr. Herman van Schalkwyk to regularly communicate with staff about staff and company matters. Esprit de Corps is a monthly staff magazine that is jam-packed with contributions by management and staff. The magazine is very popular amongst staff members, as it contains information that is fresh, new and relevant. Esprit de Corps – the Suidwes newsletter for all staff members appears every second month. Staff recognition The annual Staff Recognition Event is a highlight on the staff’s calendar. The event took place at Buisfontein Safari Lodge close to Wolmaransstad and was attended by 250 guests.At Suidwes’ annual Staff Recognition Evening, Suidwes’ annual Staff Recognition Evening was attended by 250 employees and their spouses. Hannes Herholt, Branch Manager: Stella, receives an award from Rocky le Roux, CEO: Suidwes Retail. PAGETHIRTY-SIX

Implementation of new ERP computer systemAfter using the AS400 system for 22 years the company expectations that we look forward to the effectiveness ofchanged over to the new, technologically advanced SYSPRO a new system, the switch over also caused major user andERP system. This historic occasion was preceded by nine client frustrations. Continuous communication with clientsmonths of system development, staff training and a thorough was necessary regarding the implementation process andsystem testing phase. For both system user and client, the the duration of training before everything could run smoothlynew SYSPRO system has brought about major changes. once again. The upgrading was a necessity and we thank ourNew technology requires new knowledge and skills and a clients for their patience and understanding in this regard.lot of time was spent on training. Although it is with great Monthly New and Receive an Statement - effective invoice via emailsingle document pay-point for all Suidwes technology for each day’s transactions transactionsSuidwes Ambassadors ClubThe Suidwes Ambassadors Club was The opening ceremony of the Suidwes Ambassadors Club was officiated by Mr. Hansie Viljoenestablished in 2017 with employees (Chairperson of the board) and Dr. Herman van Schalkwyk (Group CEO).on management and supervisor levelbeing members of the club. As SuidwesAmbassador, the members representthe company and subsequently carry theresponsibility to promote and protect thecompany’s interests and values. Duringthe inauguration of a new member, acertificate is handed out during a formalevent. The chairperson of the Suidwesboard also serves as chairperson of theSuidwes Ambassadors Club. One of theobjectives of the Ambassadors Club isto reach out to organisations and otherbodies in our towns and to involve themwith this initiative in order to collectivelyconfront the challenges. 37 SUSTAINABILITY REPORT

Staff meetings Branches in each town in the Suidwes operational area hold annual staff meetings. During these meetings, Dr. Herman van Schalkwyk and the rest of the management team spend some time with staff members and discuss relevant staff and business matters. Staff meetings are held regularly where company information is shared.Town meetings challenges in the specific town are discussed. As a result of the improved cooperation between divisions, service toThe objective of town meetings is to improve cooperation clients is also improved.and liaison between the different divisions within Suidwes.Monthly town meetings are held by the management ofdepartments involved in the town, where opportunities andCasual Day 2017Casual Day and Valentine’s Day are also supported with great enthusiasm by Suidwes’ staff members. Specific themes areportrayed and, in the process, a healthy spirit amongst staff is fostered. Suidwes staff participate in the annual Casual Day. Valentine’s Day is celebrated with great enthusiasm.Suidwes Mascot Presentation of Blitz – Suidwes’ Super Hero during theBlitz – Suidwes’ very own super hero mascot appearedin February 2018 and was presented during the Suidwes Suidwes Management Indaba.Management Indaba. Blitz has above average intelligenceand supersonic hearing. He is a very humble character and isregularly seen at Suidwes-sponsored school sport events, aswell as in the corridors of Suidwes’ Central office.PAGETHIRTY-EIGHT

DEVELOPMENT OF HUMAN CAPITAL Skills development and apprenticeshipsEvery year young, inexperienced and unemployed youth are offered an opportunity to receive a qualification by means ofthe Suidwes Skills Development and Apprenticeship Programme. AgriSETA also assisted with funding and 26 candidatesreceived a training opportunity.APPRENTICESHIPS 2017/2018 From the Staff, For the Staff TOTALGrain 2017 (Completed February 2018) 9Retail 2017 1Grain 2018 9Maintenance 2Workshop 5APPRENTICESHIPS During April 2017 six diesel apprentices registered at Suidwes and were allocated to the workshops in Wolmaransstad,One apprentice from the Maintenance division is still busy Schweizer-Reneke and Bothaville, respectively.with the final phases of training as boilermaker, while oneapprentice qualified as electrician in September 2017 andaccepted a permanent position at Suidwes. In April 2018 twoapprentices commenced with their training as boilermakerand fitter and turner respectively.STUDY LOANS monthly salary. A total of 20 study loans were allocated last year.Study loan facilities for permanent employees and their directfamily (husband, wife, children) are available. The amountof the loan may not be more than 60% of the employee’s 39 SUSTAINABILITY REPORT

BURSARIES/CAREER DEVELOPMENT Formal Training Total (Completed 2017)AgriSETA provides funds to Suidwes to ensure that the workforce within the MBP 20organisation are equipped with the necessary qualifications. Aside from specific AMP 8claims, Suidwes qualifies for discretionary allowances that are allocated by AgriSETA BCom 1for additional training and for employment of apprenticeships. 29 TotalIn-house training in various fields is offered and addresses the requirements ofevery employee. Employees are hereby empowered and can thus be proactive to Formal Training Totalmeet the client’s needs. (2018) 10Formal training at tertiary institutions is presented at various levels and involves MBP 13management, skills and specialist training. This training also involves Fundamental, AMP 1Middle and Advanced Management Programmes, as well as a post-graduate BCom 6Diploma in Management at the NWU. Staff of Agrifriend, Agrinet, Protek and PGDIP 30Suidwes followed the programme. Two students of the 2018 group are attendingthe Middle Management Programme at the University of Stellenbosch. TotalVarious other training courses are followed, namely:• ACS Embrace (Agrinet);• Analytical Chemistry (NviroTek);• Debt Collection (AgriCapital);• BASOS (Terratek);• SAIPA (Suidwes);• Marketing Management (Agrinet);• Insolvency Law (Suidwes); and• Certificate in Business Accounting (NviroTek). Some of Suidwes’ staff completed the Certificate Course: AMP and MMP at the North West University. (Back, left to right): Julia Kambinda (AMP), Herman Verwey (AMP), Shantelle Pieterse (Agrinet, MMP), Shaun Swanepoel (MMP), Thulani Dlamini (MMP), Nicolize Coetzee (AMP), Wolf Wolmarans (AMP), Simon Mbongo (MMP), Hansie Swanepoel (AMP). (Front, left to right): Porchia Senatle (AMP), Santha Perumal (MMP), Anneli Nieuman (Agrinet, AMP), Doné van der Westhuizen (Agrinet, MMP), Juanita Treurnich (MMP), Rietjie Joubert (MMP), Daniel Phahlamohlaka (Agrinet, MMP) and Mari Crafford (MMP).Suidwes’ AMP students take a coffee break during a study school presented by the Post-Graduate Management School offered by the North West University.PAGEFORTY

IN-HOUSE TRAINING(1 May 2017 – 30 April 2018)Suidwes strives to attract, develop and retain skillful andperforming employees. Suidwes also strives towards aworking environment that encourages staff to acquirebetter qualifications in order to reach their full potentialfor the benefit of both the employee and the employer.The following courses were offered:Course Title Total In preparation of the implementation of the new ERP system, 326 employees completed a two-day, in-house ChangeBasic Job Essentials 164 Management Programme.Irrigation 34Combatting Fires 35 Personnel attend training at the Suidwes Training CenterCipla Product Training 22 in Leeudoringstad.Effective Communication Skills 55Disciplinary Course 24 Gavilon offers product training to Suidwes Branch Managers.Employment Equity 13Forklift 37 Suidwes’ general workers receive training in basic Self-management skills.Grain Handling 94HC Heystek 13 41Introduction to PC 11Kaufmann Locks 17 SUSTAINABILITY REPORTClient Service 28Laboratory Short Courses 222Landscape Irrigation Installation 2Leadership Development 48Apprentice - Millwright 1Conformance Course 1Learners 18Emergency Aid 39Sage – People System 9Product Training 65Ref Check 2Rockworth Compressors 8Scaffolding 34Support Centre Training 26SYSPRO 771Tractor Training 22Change Management 326Safety 15Working @ Heights 25Zoetis Product Training 11Emerging Farmers 20Diesel Mechanics 5Fitter and Turner 1Boilermaker 1Graduates 2017/2018 4Internship 4Total 2,219With funding from AgriSETA a four-day leadership coursewas presented to 40 employees. The employees whocompleted the programme recommend this course toeveryone inside Suidwes.

EMERGING FARMERS Certificates are awarded to candidates who completed the training programme for emerging farmers.With funds that AgriSETA has made available, more farmerswere trained in Mixed Farming. This was the secondopportunity that Suidwes had to train emerging farmers.This was also the first time that any training of this naturewas provided in Bloemhof. The Department of Agricultureattended the opening day and extended their gratitude forthe manner in which emerging farmers are assisted.AgriSETA provided more funds for the training of 15 emergingfarmers during 2018. Of the 20 students who attendedthe training, 13 were declared competent. The othersreceived certificates for the modules that they attended andcompleted. The certificate ceremony was held in Bloemhofon 10 May 2018.Summary of funding receivedfrom AgriSETATotal surcharges paid 2017/2018: R2,555,940.86Funding approved for payment to Suidwes 2017/2018 TotalArtisans R320,000Post-graduate placing R225,000Bursaries R951,595Skills training R288,106PARTICIPATION IN CAREER EXHIBITIONSSuidwes Agriculture was represented by the Recruitment team at the career exhibition events held at the NWU and UFS.PAGEFORTY-TWO

ENVIRONMENTAL AND OCCUPATIONAL SAFETYEnvironmental policy and objectivesThe Suidwes Group accepts its responsibility to structure its The preservance of natural resources and energy is a prioritybusiness activities in such a way that the available resources for the company and there are constantly efforts to limitare utilised sustainably. We are committed to protecting the harmful substances to the minimum. The recycling of allenvironment, maintaining our natural resources and utilising possible materials is encouraged. The focus on green projectsit in an effective and responsible manner and to implement and to utilise new technology is high on the priority list of thehealthy environment practices in all our business activities. company. Success has already been achieved by using new energy-saving products that are available. Energy generationThe repercussions of poor environmental management and by means of solar panels is becoming more affordable and isdisobeying existing legislation that includes harm to the currently being investigated.company’s image as well as prosecution, is an immenseproblem for modern companies and must be managed.OCCUPATIONAL SAFETYThe Suidwes Group remains committed to establishing a Several inspections have been conducted by the Departmentsafe working environment in which its employees and other of Labour at Suidwes during the report period understakeholders can function optimally. The safety process at review. No substantial deviations were found during theseSuidwes is managed according to policy and procedures. The inspections. Good relationships are maintained and cleanexecutive management is responsible for the establishment inspection reports are constantly pursued.of safety and environmental policy and procedures, as well asthe implementation thereof within their respective areas of The following operational units were inspected by theresponsibility. Suidwes’ health and safety programme targets Department of Labour:certain actions relating to noise, dust particles, lighting, aswell as being exposed to chemical substances. • Silos: Christiana, Migdol, Kingswood, Schweizer-Reneke, Hallatshope, Amalia, Misgunst Bunker, BamboesspruitMonitoring takes place in high risk areas where loud noise and Strydpoort.and a lot of dust is encountered. Employees are sent for thenecessary tests, and follow-up visits for workers in the most • Retail branches: Bothaville, Vryburg, Bamboesspruit,dangerous category are ensured. Information from these Stella, Christiana, Schweizer-Reneke, Migdol, Reivilo,tests are stored on a data base to help identify and monitor Makwassie and Hoopstad.any deviations and to timely take precautionary measures.Employees who are exposed to these areas undergo annualmedical tests that determine if there are any deteriorationin their health. Training in the form of safety equipment andthe reason why safety equipment must be used, is regularlydiscussed with employees. 43 SUSTAINABILITY REPORT

FINANCIALSTATEMENTS 4PAGEFORTY-FOUR

Life is not about waiting for the INDEXstorm to pass, It’s about learning to dance in the rain Vivian Greene Declaration of the Audit, Risk and IT Committee 47 Independent Auditor’s Report 48 Consolidated and Separate Income Statement 50 Consolidated and Separate Statement of 51 COmprehensive Income Consolidated and Separate Statement of 52 Financial Position Consolidated Statement of Changes in Equity 53 Separate Statement of Changes in Equity 54 Consolidated and Separate Cash Flow Statement 55 Notes to the Financial Statement 56 ADMINISTRATIVE INFORMATION 58 45

PAGEFORTY-SIX SUIDWES HOLDINGS (RF) PROPRIETARY LIMITED

DECLARATION OF THE AUDIT, RISKAND IT COMMITTEEIn accordance with the stipulations of the Companies Act, No. 71 of 2008, as amended (“the Companies Act”), for this yearthe Audit, Risk and IT Committee (“the Committee”) of Suidwes Holdings (RF) Proprietary Limited comprised of at leastthree independent non-executive directors.The Committee acts in accordance with a formal mandate under the authority of the board of directors.The most important roles and functions of the Committee are:• To assist the board of directors to meet their obligations in relation to the safeguarding of assets;• To satisfy the board of directors that sufficient financial and management controls exist in the Group and that all actual corporate risks have been identified and are receiving the necessary attention;• To establish and execute effective systems of internal control;• To ensure that internal, financial and operational controls are enforced;• To investigate the integrated reporting and financial information that is provided by the Company;• To ensure that an effective risk management system exists that does not only identify risks, but also addresses them;• To ensure that information technology risks and controls, as well as information security and confidentiality are addressed adequately;• To consider business sustainability; and• To assess the Company’s compliance with laws and regulations.In the execution of its mandate the Committee is, according to its exclusive discretion, entitled to obtain independentadvice about any matter. In accordance with its mandate, the chair of the Committee is an independent non-executivedirector.The composition of the Committee, as on 30 April 2018, is given on Page 24.In accordance with the requirements of the Companies Act, the Company’s Audit Committee is obliged to, every year,nominate independent external auditors for appointment as auditors of the Group. The Committee determines theconditions of employment and remuneration of the auditors and has to preapprove all instructions or work not related toauditing that are given to the auditors.The Committee discusses the following matters with the board of directors and advises the board about it:• The separate and consolidated annual financial statements, reporting, disclosure and accounting policy;• Transactions that are entered into beyond the normal course of business;• Internal audit mandate, as well as internal audit planning and reports;• External audit planning and reports for both the interim and final audit, as well as the independence of the external auditors;• Compliance with legal requirements, the Code of Corporate Practice and the Ethical Code of Conduct of the Group;• Communication with executive management and auditors; and• The effectiveness of management information and internal control systems.Suidwes makes use of the services of Whistle Blowers for anonymous reporting of cases of unethical behaviour, fraud,contravention of legislation and other irregularities. In addition to the services of Whistle Blowers, Suidwes also has anindependent toll-free telephone line for anonymous reporting of the behaviour mentioned above. The Committee receivesa comprehensive record of all calls made to this facility, with a report of the action that was taken in response.The Committee meets at least three times per year in order to execute its activities. In addition to the people mentionedon page 24, the Committee’s meetings are attended by the external auditors, internal auditors and members of seniormanagement.INDEPENDENCE OF THE AUDITORSIn accordance with Section 94(7)(a) of the Companies Act, we hereby declare that the external auditors,PricewaterhouseCoopers Incorporated, are independent of the Company and its subsidiaries.Ms. B MathewsChair of the Audit, Risk and IT Committee27 July 2018 47 DECLARATION OF THE AUDIT, RISK AND IT COMMITTEE

INDEPENDANT Independent auditor’s report on the summary consolidated and separate AUDITOR’S REPORT financial statements To the Shareholders of Suidwes Holdings (RF) Proprietary Limited Opinion The summary consolidated and separate financial statements of Suidwes Holdings (RF) Proprietary Limited, set out on pages 50 to 57, which comprise the summary consolidated and separate statement of financial position as at 30 April 2018, the summary consolidated and separate income statement, the summary consolidated and separate statement of comprehensive income, changes in equity and cash flow statement for the year then ended, and related notes, are derived from the audited consolidated and separate financial statements of Suidwes Holdings (RF) Proprietary Limited for the year ended 30 April 2018. In our opinion, the accompanying summary consolidated and separate financial statements are consistent, in all material respects, with the audited consolidated and separate financial statements, in accordance with the basis described in Note 1 to the summary consolidated and separate financial statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements. Summary Consolidated and Separate Financial Statements The summary consolidated and separate financial statements do not contain all the disclosures required by International Financial Reporting Standards and the requirements of the Companies Act of South Africa as applicable to annual financial statements. Reading the summary consolidated and separate financial statements and the auditor’s report thereon, therefore, is not a substitute for reading the audited consolidated and separate financial statements and the auditor’s report thereon. The Audited Consolidated and Separate Financial Statements and Our Report Thereon We expressed an unmodified audit opinion on the audited consolidated and separate financial statements in our report dated 31 August 2018. Director’s Responsibility for the Summary Consolidated and Separate Financial Statements The directors are responsible for the preparation of the summary consolidated and separate financial statements in accordance with the basis of preparation described in Note 1 to the summary consolidated and separate financial statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements. PAGEFORTY-EIGHT