• + 35. Principal subsidiaries
                               
    35. Principal subsidiaries                          
                               
    Details of Massmart’s principal subsidiary companies are as follows:
                               
          Number of shares in issue   Place of incorporation and operation   Ownership   Voting power       Interest in Subsidiaries1
    Name of company     000s     %   %   Principal activity   Rm
                               
    December 2018                          
    Massbuild Proprietary Limited       South Africa     100     100   Wholesale and retail of DIY products     289.3
    Masscash Holdings Proprietary Limited     South Africa     100     100   Holding company     3,055.8
    Massmart International Holdings Limited     Mauritius     100     100   Holding company     81.4
    Masstores Proprietary Limited     200   South Africa     100     100   Retailing, warehousing, mass merchandising     (0.3)
    Massmart Management and Finance Company Proprietary Limited     South Africa     100     100   Management, investment and finance  
    Wild Developments Proprietary Limited     South Africa     100     100   Property Holding Company     197.8
    Other smaller subsidiaries       Various                 1,380.0
                                5,004.0
    December 2017                          
    Massbuild Proprietary Limited       South Africa     100     100   Wholesale and retail of DIY products     297.2
    Masscash Holdings Proprietary Limited     South Africa     100     100   Holding company     2,518.3
    Massmart International Holdings Limited     Mauritius     100     100   Holding company     81.4
    Masstores Proprietary Limited     200   South Africa     100     100   Retailing, warehousing, mass merchandising     142.2
    Massmart Management and Finance Company Proprietary Limited     South Africa     100     100   Management, investment and finance     161.8
    Wild Developments Proprietary Limited     South Africa     100     100   Property Holding Company     197.8
    Other smaller subsidiaries       Various                 1,418.7
                                4,817.4
                               
    The above details are given in respect of interests in subsidiaries, where material. A full list of subsidiaries is available to shareholders, on request, at the registered office of the Company.
    There were no material non-controlling interests identified within the Group in the current and prior financial years.
    1Interest includes the value of the shares in as well as loans to/from these principal subsidiaries.
                               
                               
  • + 36. Notes to the Statement of Cash Flows
               
    36. Notes to the Statement of Cash Flows          
               
          December 2018   Restated
    December 2017
    Rm Notes   52 weeks   53 weeks*
    36.1 Cash inflow from trading activities          
    Profit before taxation     1,268.1   2,152.9
    Adjusted for:          
    Depreciation, amortisation and impairment     1,156.0   1,118.6
    Net (profit)/loss on disposal of tangible and intangible assets     (9.5)   21.0
    Finance costs     648.8   603.5
    Finance income     (25.1)   (26.4)
    Dividends from unlisted investments     (34.0)   (80.0)
    Share-based payment expense     194.6   163.7
    Unrealised foreign exchange profit     11.8   (93.5)
    Other non-cash movements     202.3   109.3
          3,411.3   3,969.1
               
    36.2 Working capital movements          
    (Increase)/decrease in inventories     (1,024.6)   260.8
    (Increase)/decrease in trade receivables and prepayments     (575.1)   (403.5)
    Increase in trade payables     1,226.3   891.1
    Decrease in provisions     (172.4)   (42.6)
          (545.8)   705.8
               
    36.3 Taxation paid          
    Normal taxation:          
    Amounts owing at the beginning of the year     337.4   87.1
    Amounts owing at the end of the year     (156.0)   (337.4)
    Taxation recognised in the Income Statement     (506.0)   (544.7)
          (324.6)   (795.0)
               
    36.4 Investment to maintain operations          
    Land and buildings/leasehold improvements     (103.7)   (156.0)
    Vehicles     (64.8)   (35.4)
    Fixtures, fittings, plant and equipment     (295.7)   (328.9)
    Computer hardware     (138.9)   (98.4)
    Computer software     (169.3)   (59.8)
          (772.4)   (678.5)
               
               
          December 2018   Restated
    December 2017
    Rm Notes   52 weeks   53 weeks*
    36.5 Investment to expand operations          
    Land and buildings/leasehold improvements     (191.6)   (533.8)
    Vehicles     (15.7)   (5.2)
    Fixtures, fittings, plant and equipment     (291.9)   (270.5)
    Computer hardware     (72.9)   (28.8)
    Computer software     (261.5)   (300.0)
          (833.6)   (1,138.3)
               
    36.6 Proceeds on disposal of assets classified as held for sale     32.8   9.4
               
    36.7 Non-controlling interests acquired          
    Non-controlling interest       (9.4)
    Other reserves – premium on acquisition of non-controlling interests       (103.2)
            (112.6)
               
    36.8 Cash and cash equivalents at the end of the year          
    Cash on hand and bank balances     2,369.8   2,393.6
    Bank overdrafts1       (87.5)
    Cash and cash equivalents at the end of the year     2,369.8   2,306.1
               
    1Bank overdrafts in the current year include overnight borrowings which are financing in nature.          
    *Refer to note 41.          
  • + 37. Fair Value
                                     
                     
    37. Fair Value
                                 
    Fair value hierarchy
                                 
    The table below reflects ‘Financial instruments’ and ‘Non-current assets classified as held for sale’ carried at fair value, and those ‘Financial instruments’ and ‘Non-current assets classified as held for sale’ that have carrying amounts that differ from their fair values, in the Statement of Financial Position:
                                 
                                 
    Financial instruments in the Statement of Financial Position
                                 
    Rm   Total Carrying Amount   Total Fair Value   Level 1   Level 2   Level 3
                                 
    December 2018                    
    Financial Assets                    
    Financial assets at fair value through profit or loss   124.3   124.3     124.3  
    Financial asset designated as a cash flow hedging instrument            
    Debt instruments at amortised cost   11.8   9.6     9.6  
    OCI financial assets   1.1   1.1   1.1    
    Non-current assets classified as held for sale   11.6   11.6       11.6
                148.8   146.6   1.1   133.9   11.6
                                 
    Financial liabilities                    
    Financial liabilities at amortised cost   2,291.1   2,342.2     2,342.2  
    Financial liabilities at fair value through profit or loss   24.8   24.8     24.8  
                2,315.9   2,367.0     2,367.0  
                                 
                                 
    There were no transfers between the fair value categories during the December 2018 financial year.
    The financial assets and financial liabilities have been presented based on an analysis of their respective natures, characteristics and risks.
                                 
                                 
    Financial instruments in the Statement of Financial Position    
    Rm   Total Carrying Amount   Total Fair Value   Level 1   Level 2   Level 3
                                 
    December 2017                    
    Financial Assets                    
    Financial assets at fair value through profit or loss   134.9   134.9     134.9  
    Financial asset designated as a cash flow hedging instrument   1.1   1.1     1.1  
    Debt instruments at amortised cost   17.6   13.1     13.1  
    AFS financial assets   1.1   1.1   1.1    
    Non-current assets classified as held for sale   19.9   19.9       19.9
                174.6   170.1   1.1   149.1   19.9
                                 
    Financial liabilities                    
    Financial liabilities at amortised cost   3,206.7   3,259.5     3,259.5  
    Financial liabilities at fair value through profit or loss   28.7   28.7     28.7  
    Financial liability designated as a cash flow hedging instrument   23.8   23.8     23.8  
                3,259.2   3,312.0     3,312.0  
                                 
    There were no transfers between the fair value categories during the December 2017 financial year.
    The financial assets and financial liabilities have been presented based on an analysis of their respective natures, characteristics and risks.
                                 
                                 
    Fair value measurement and valuation techniques for level 2 and level 3 financial instruments
                                 
    Rm     Fair value December 2018   Valuation technique   Significant inputs   Input
    2018
                                 
    Type of financial instrument                
    Financial Assets                
                                 
    Financial assets at fair value through profit or loss   124.3            
    Investment in insurance cell-captive on extended warranties   30.0   NAV   Cash and cash equivalents    
                            Investment in unit trusts    
                            Insurance fund liabilities    
    Investment in insurance cell-captive on premium contributions   66.3   NAV   Cash and cash equivalents    
                            Investment in unit trusts    
                            Insurance fund liabilities    
    Investment in insurance cell-captive on credit life   4.6   NAV   Cash and cash equivalents    
    FEC asset – non-designated   23.4   DCF   Yield curves
    Market interest rate
    Market foreign exchange rate
       
                                 
                                 
    Debt instruments at amortised cost   9.6            
    Employee share trust loans   9.6   DCF   Market interest rate    
                     
    OCI financial assets   1.1            
    Listed investments   1.1            
                     
        11.6            
    Non-current assets classified as held for sale   11.6   Signed sales agreement   Expected selling price in the market   11.6
                     
                    146.6            
                                 
    Financial liabilities                
                                 
    Financial liabilities at amortised cost   2,342.2            
    Medium-term bank loans   2,342.2   DCF   Market interest rate    
    Financial liabilities at fair value through profit or loss   24.8            
    FEC liability   24.8   DCF   Yield curves
    Market interest rate
    Market foreign exchange rate
       
                                 
                    2,367.0            
                                 
                                 
    Valuation technique   Description of valuation technique
                                 
    Net asset value (NAV)   Net asset value is used as a valuation technique where the underlying assets and liabilities have been assessed to represent the fair value of the investment. Due to the nature of the investment, specifically the significant composition of liquid assets and liabilities, the net asset value is seen to be the most appropriate representation of fair value.
                                 
    Discounted cash flow (DCF)   The DCF method involves the projection of a series of cash flows. To this projected cash flow series, an appropriate, market-derived discount rate is applied to establish the present value of the cash flow stream associated with the item. With regards to assets, the fair value is estimated using explicit assumptions regarding the benefits and liabilities of ownership over the asset’s life including an exit or terminal value. With regards to liabilities, in determining fair value management considers non-performance risk and the Group’s own credit risk. To this end, the Group applies level 2 of the expected present value technique per IFRS 13 Fair Value Measurement.
                                 
                                 
    Fair value measurement and valuation techniques for level 2 and level 3 financial instruments
                                 
    Rm     Fair value December 2017   Valuation technique   Significant inputs   Input 2017
                                 
    Type of financial instrument                
                                 
    Financial Assets                
                                 
    Financial assets at fair value through profit or loss   134.9            
    Investment in insurance cell-captive on extended warranties   32.9   NAV   Cash and cash equivalents    
                            Investment in unit trusts    
                            Insurance fund liabilities    
    Investment in insurance cell-captive on premium contributions   94.0   NAV   Cash and cash equivalents    
                            Investment in unit trusts    
                            Insurance fund liabilities    
    Investment in insurance cell-captive on credit life   5.2   NAV   Cash and cash equivalents    
    FEC asset – non-designated   2.8   DCF   Yield curves
    Market interest rate
    Market foreign exchange rate
       
                                 
                    1.1            
    FEC asset – Designated   1.1   DCF   Yield curves
    Market interest rate
    Market foreign exchange rate
       
                                 
    Debt instruments at amortised cost   13.1            
    Employee share trust loans   13.1   DCF   Market interest rate    
                                 
    Available-for-sale financial assets   1.1            
    Listed investments   1.1            
                                 
                    19.9            
    Non-current assets classified as held for sale   19.9   Signed sales agreement   Expected selling price in the market   19.9
                                 
                    170.1            
                                 
    Financial liabilities                
                                 
    Financial liabilities at amortised cost   3,259.5            
    Medium-term loan   597.7   DCF   Market interest rate    
    Medium-term bank loans   2,661.8   DCF   Market interest rate    
                                 
    Financial liabilities at fair value through profit or loss   28.7            
    FEC liability – De-designated   28.7   DCF   Yield curves
    Market interest rate
    Market foreign exchange rate
       
                    23.8            
    FEC liability – Designated     23.8   DCF   Yield curves
    Market interest rate
    Market foreign exchange rate
       
                                 
                    3,312.0            
                                 
                                 
    Valuation technique   Description of valuation technique
                                 
    Net asset value (NAV)   Net asset value is used as a valuation technique where the underlying assets and liabilities have been assessed to represent the fair value of the investment. Due to the nature of the investment, specifically the significant composition of liquid assets and liabilities, the net asset value is seen to be the most appropriate representation of fair value.
                                 
    Discounted cash flow (DCF)   The DCF method involves the projection of a series of cash flows. To this projected cash flow series, an appropriate, market-derived discount rate is applied to establish the present value of the cash flow stream associated with the item. With regards to assets, the fair value is estimated using explicit assumptions regarding the benefits and liabilities of ownership over the asset’s life including an exit or terminal value. With regards to liabilities, in determining fair value management considers non-performance risk and the Group’s own credit risk. To this end, the Group applies Method 2 of the expected present value technique per IFRS 13 Fair Value Measurement.
                                 
                                 
  • + 38. Risk Management
                                               
                       
      38. Risk Management                  
                                               
      Capital risk management                  
                                               
      The Group measures its capacity for debt by monitoring gross interest-bearing debt (including a 5 times multiple of rent) over EBITDAR and EBITDA divided by net interest. Provided that these two metrics are within target ranges (agreed with the Group’s Audit Committee and lenders from time to time), the Group is satisfied that it will continue as a going concern while maximising the return to stakeholders through the optimisation of debt and equity balances.          
                                               
      The capital structure of the Group consists of debt, more specifically medium-term interest-bearing debt and equity attributable to owners of the parent, comprising share capital, share premium, other reserves and retained profit (See note 20 and note 21 respectively).          
                 
      The targeted level of gearing is determined after consideration of the following key factors :          
      – the needs of the Group to fund current and future capital expenditure to achieve its stated production growth target; and          
      – the desire of the Group to maintain its gearing within levels considered to be acceptable taking into account potential business opportunities and the position of the Group in the business cycle.          
      The targeted level of gearing was adequately managed in the current financial year.          
                 
      The Group has medium-term debt facilities that include certain covenants, including:          
      – maximum gearing ratio;          
      – minimum interest cover; and          
      – specified levels of shareholders’ equity.          
                 
      The Group’s general banking facility can be analysed as follows:          
                                               
      Rm   December 2018   December 2017                              
                                               
      Available cash reserves     625.8   2,306.1                              
      General banking facility     6,575.8   6,761.5                              
      Total     7,201.6   9,067.6                              
                                               
      The above general banking facility excludes a R500m seasonal facility in the current and prior financial year.          
      The Group complies with all externally imposed capital requirements relating to loan covenants.          
                                               
                                               
      Classification of financial instruments                                  
                                               
      December 2018     Financial instrument   Cash flow – hedging instrument   FVTPL   Liability at amortised cost   Asset at amortised cost   OCI financial assets   Non-financial instruments          
      Rm                          
      ASSETS                                        
      Non-current assets                                        
      Property, plant and equipment               9,647.2          
      Goodwill               2,599.2          
      Other intangibles assets               1,057.1          
      Investments   102.0     100.9       1.1            
      Other financial assets   17.2         17.2              
      Deferred taxation               743.1          
      Current assets                                    
      Inventories               12,180.9          
      Trade, other receivables and prepayments   5,264.8     23.4     5,241.4     428.4          
      – Trade receivables   2,608.4         2,608.4              
      – Other accounts receivable and prepayments   2,633.0         2,633.0     428.4          
      – FEC asset   23.4     23.4                  
      Taxation               361.3          
      Cash on hand and bank balances   2,369.8         2,369.8              
      Non-current assets classified as held for sale               11.6          
                                               
      Total assets   7,753.8     124.3     7,628.4   1.1   27,028.8          
                                               
      Non-current liabilities                                        
      Non-current liabilities – interest-bearing borrowings   2,254.1       2,254.1                
      Non-current liabilities – interest-free borrowings               1,278.2          
      Provisions               85.5          
      Deferred taxation               76.7          
      Current liabilities                                      
      Trade and other payables   21,797.8     24.8   21,773.0                
      Provisions               127.3          
      Other current liabilities   685.1       685.1                
      Taxation               205.3          
      Bank overdrafts   1,744.0       1,744.0                
                                               
      Total liabilities   26,481.0     24.8   26,456.2       1,773.0          
                                               
                                               
      December 2017   Financial instrument   Cash flow – hedging instrument   FVTPL   Liability at amortised cost   Debt instruments at amortised cost   Available-for-sale financial instruments   Non-financial instruments          
      Rm                          
      ASSETS                                        
      Non-current assets                                      
      Property, plant and equipment               9,368.1          
      Goodwill               2,596.1          
      Other intangibles assets               782.8          
      Investments   133.2     132.1       1.1            
      Other financial assets   23.0         23.0              
      Deferred taxation               671.9          
                                               
      Current assets                                      
      Inventories               10,984.6          
      Trade, other receivables and prepayments   4,744.7   1.1   2.8     4,740.8     374.4          
      – Trade receivables   2,431.3         2,431.3              
      – Other accounts receivable and prepayments   2,309.5         2,309.5     374.4          
      – FEC asset   3.9   1.1   2.8                  
      Taxation               396.5          
      Cash on hand and bank balances   2,393.6         2,393.6              
      Non-current assets classified as held for sale               19.9          
                                               
      Total assets   7,294.5   1.1   134.9     7,157.4   1.1   25,194.3          
                                               
                                               
      Non-current liabilities                                        
      Non-current liabilities – interest-bearing borrowings   2,760.8       2,760.8                
      Non-current liabilities – interest-free borrowings   2.0       2.0       1,217.7          
      Provisions               95.6          
      Deferred taxation               66.3          
      Current liabilities                                      
      Trade and other payables   19,288.4   23.8   28.7   19,235.9       1,209.5          
      Provisions and other               83.5          
      Other current liabilities   1,276.7       1,276.7                
      Taxation               59.1          
      Bank overdrafts   87.5       87.5                
                                               
      Total liabilities   23,415.5   23.8   28.7   23,363.1       2,731.7          
                                               
                                               
      Financial risk management                  
                 
      The Group does not trade in financial instruments, but in the ordinary course of business operations, the Group is exposed to a variety of financial risks arising from the use of financial instruments. These risks include:          
      – market risk (comprising interest rate risk and currency risk);          
      – liquidity risk; and          
      – credit risk.          
      The Group has developed a comprehensive risk management process to facilitate, control and monitor these risks. This process includes formal documentation of policies, including limits, controls and reporting structures. The Executive Committee is responsible for risk management activities within the Group.          
                                               
      Market risk management                  
                                               
      Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The market risks that the Group is primarily exposed to include interest rate risk and currency risk. Market risk is managed by identifying and quantifying risks on the basis of current and future expectations and ensuring that all trading occurs within defined parameters. This involves the review and implementation of methodologies to reduce risk exposure. The reporting on the state of the risk and risk practices to the Executive Committee of the Group is part of this process. There has been no change to the Group’s exposure to market risk or the manner in which it manages and measures the risk since the prior financial year.          
                                               
      Interest rate risk management                  
                                               
      During the year, the surplus cash position of the Group remained fairly constant with that of the prior year. The size of the Group’s position, be it either surplus cash or borrowings, exposes it to interest rate risk. The interest-bearing loan funding requirements and the investment of surplus cash funds are managed by the Group through its own commercial bank facilities.          
                                               
      The carrying amount of the Group’s financial assets and liabilities at reporting date that are subject to interest rate risk are as follows :          
                                               
      December 2018             Subject to interest rate movement   Non-interest   Total              
      Rm             Fixed   Floating   bearing                
      ASSETS                                        
      Financial assets                              
      Investments       102.0   102.0              
      Other financial assets     5.4   11.8   17.2              
      Trade and other receivables     27.5   5,237.3   5,264.8              
      Cash on hand and bank balances     2,369.8     2,369.8              
      Total financial assets     2,402.7   5,351.1   7,753.8              
                                               
      Financial liabilities                              
      Non-current liabilities – interest-bearing borrowings   2,254.1       2,254.1              
      Non-current liabilities – interest-free borrowings                      
      Trade and other payables       21,797.8   21,797.8              
      Other current liabilities   669.0   16.1     685.1              
      Bank overdrafts     1,744.0     1,744.0              
      Total financial liabilities   2,923.1   1,760.1   21,797.8   26,481.0              
                                               
                                               
      December 2017   Subject to interest rate movement   Non-interest   Total              
      Rm   Fixed   Floating   bearing                
      ASSETS                              
      Financial assets                              
      Investments       133.2   133.2              
      Other financial assets     5.4   17.6   23.0              
      Trade and other receivables     33.6   4,711.1   4,744.7              
      Cash on hand and bank balances     2,393.6     2,393.6              
      Total financial assets     2,432.6   4,861.9   7,294.5              
                                               
      Financial liabilities                              
      Non-current liabilities – interest-bearing borrowings   2,760.8       2,760.8              
      Non-current liabilities – interest-free borrowings       2.0   2.0              
      Trade and other payables       19,288.4   19,288.4              
      Other current liabilities   1,026.5   250.2     1,276.7              
      Bank overdrafts     87.5     87.5              
      Total financial liabilities   3,787.3   337.7   19,290.5   23,415.5              
                                               
      Interest rate sensitivity                  
                                               
      The Group is sensitive to the movements in the SA Prime interest rate. The rates of sensitivity represents management’s assessment of the possible change in interest rates. The average interest rate for the Group for the year was 8.31% (December 2017: 8.49%), and the variable interest paid was R351.9 million (December 2017: R313.8 million). If the SA Prime interest rate increased and decreased by 100 average basis points (December 2017: increased and decreased by 100 average basis points) at year end, the net finance costs for the year would have decreased and increased by R10.5 million respectively (December 2017: decreased and increased by R3.1 million respectively). Although the Group is exposed to the USD LIBOR rate, this exposure is not considered to be significant.          
                                               
      Currency risk management                  
                                               
      All foreign-denominated trading liabilities are covered by forward exchange contracts. Foreign-denominated assets and other foreign-denominated liabilities are not covered by forward exchange contracts.          
      The carrying amount of the Group’s foreign currency denominated monetary assets at reporting date is as follows :          
                                               
      December 2018 South African Rand   USD   Pula   Metical   Cedi   Other1   Total              
      Rm                        
      Investments 102.0             102.0              
      Trade and other receivables and other financial assets 4,898.6   0.1   129.8   72.6   10.7   152.9   5,264.7              
      Cash on hand and bank balances 1,701.9   104.7   143.6   65.2   1.8   352.6   2,369.8              
      Total 6,702.5   104.8   273.4   137.8   12.5   505.5   7,736.5              
                                               
      December 2017 South African Rand   USD   Pula   Metical   Cedi   Other1   Total              
      Rm                        
      Investments 132.2           1.0   133.2              
      Trade receivables 3,028.2   6.0   202.4   85.5   (2.5)   19.3   3,338.9              
      Cash on hand and bank balances 2,044.9   100.7   102.6   37.3   8.0   100.1   2,393.6              
      Total 5,205.3   106.7   305.0   122.8   5.5   120.4   5,865.7              
                                               
      1‘Other’ comprise the balance of the currencies per table below.          
                                               
      Foreign currency sensitivity                  
                                               
      For further information regarding the forex movements for the year, refer to note 5.          
                 
      The table below indicates the Group’s sensitivity at year end to movements in the relevant foreign currencies on monetary items, excluding forward exchange contracts. The rates of sensitivity are the rates used when reporting the currency risk to the Executive Committee of the Group and represents management’s assessment of the possible change in reporting foreign currency exchange rates. The rate sensitivity remained constant in the current financial year at 10% in light of the appreciation of the Rand in the current year. For each 10% weakening/strengthening of the Rand against the listed currencies below, profit or loss is increased or decreased.          
                                               
            December 2018   December 2017              
                                               
            Spot rate   10% Rand weakening   10% Rand strengthening       10% increase   10% decrease              
      Currency         Rm   Rm   Spot rate   Rm   Rm              
      USD   14.4718   (1.1)   1.1   12.4378   2.5   (2.5)              
      Pound Sterling   18.3824       16.8067   0.0   (0.0)              
      Euro   16.5563       14.9477   0.0   (0.0)              
      Botswana Pula   1.3731   1.5   (1.5)   1.2347   1.1   (1.1)              
      Ghanaian New Cedi   3.0294   (0.1)   0.1   2.7988   0.1   (0.1)              
      Kenyan Shilling   0.1411   1.0   (1.0)   0.1202   (0.3)   0.3              
      Malawian Kwacha   0.0193   0.2   (0.2)   0.0169   0.4   (0.4)              
      Mauritian Rupee     0.4124   (0.0)   0.0   0.3603   0.1   (0.1)              
      Mozambican New Metical   0.2280   3.4   (3.4)   0.2004   1.3   (1.3)              
      Nigerian Naira   0.0432   0.9   (0.9)   0.0372   (1.0)   1.0              
      Tanzanian Shilling   0.0064   (0.2)   0.2   0.0055   0.0   (0.0)              
      Uganda Shilling   0.0039   (0.6)   0.6   0.0034   0.0   (0.0)              
      Zambian New Kwacha   1.2740   (1.0)   1.0   1.2580   0.6   (0.6)              
                                               
                                               
      Forward foreign exchange contracts                  
                                               
      Forward exchange contracts are entered into to manage exposure to fluctuations in foreign currency exchange rates on specific trading transactions. The Group’s policy is to enter into forward contracts for all committed foreign currency purchases to hedge the Group’s exposure to variability in cash flows. For more information refer to note 5.In the current year the Group closed out the cash flow hedge through sale of inventory and changed to fair value hedge accounting. There are no other hedges in the Group.          
                                               
      December 2018             Foreign currency   Fair value adjustment   Average exchange rate                  
      At year end, the open forward exchange contracts were as follows:   (millions)   Rm                      
      USD             65.6   6.3   16.5                  
      Sterling                                  
      Euro             0.0   -0.0   14.5                  
      Total                 6.3                      
                                               
      December 2017             Foreign currency   Fair value adjustment   Average exchange rate                  
      At year end, the open forward exchange contracts were as follows:   (millions)   Rm                      
      USD             41.2   (48.2)   13.7                  
      Sterling             0.1   (0.1)   18.8                  
      Euro             0.2   (0.2)   16.3                  
      Total                 (48.6)                      
                                               
      The fair value adjustment represents the balance at the end of the current financial year and is included in Trade and other receivables (FEC asset balance) and included in Trade and other payables (FEC liability balance). As the average duration is three months, these FEC balances would be derecognised and the resulting impact would be accounted for in cost of sales and in foreign exchange gains/(losses) in the Income Statement within the next financial year for both periods under review.          
                                               
      During the December 2018 financial year an amount of R14.9 million (December 2017: R9.2 million) (net of tax) relating to the FEC hedges was recognised in other comprehensive income. For more information on the movement in the hedging reserve refer to note 21.          
                                               
      Forward foreign exchange contracts sensitivity                      
                                               
      The following table indicates the Group’s sensitivity of the outstanding forward exchange contracts at the reporting date to movements in the USD. The USD is the primary currency in which the Group has entered into forward foreign exchange contracts. The rates of sensitivity are the rates used when reporting the currency risk to the Executive Committee of the Group and represents management’s assessment of the possible change in foreign currency exchange rates. The Rand/USD year end rate was R14.52 (December 2017: R14.43).          
                                               
            December 2018   December 2017                      
            USD   USD   USD   USD                      
      Rm     5% increase   5% decrease   5% increase   5% decrease                      
      (Loss)/Profit   (21.8)   21.8   (29.9)   29.9                      
      Derivative financial (liabilities)/assets       (44.8)   44.8                      
      Equity     (21.8)   21.8   (14.9)   14.9                      
                                               
                                               
      Liquidity risk management                  
                                               
      Liquidity risk is the risk that the Group will be unable to meet a financial commitment in any location or currency. This risk is minimised through the holding of cash balances and sufficient available borrowing facilities (refer to note 22). In addition, detailed cash flow forecasts are regularly prepared and reviewed so that the cash needs of the Group are managed according to its requirements.          
                 
      The following table details the Group’s contractual maturity for its financial liabilities. The table has been compiled based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to repay the liability. The cash flows include both the principal and estimated interest payments.          
                                               
      December 2018             Repayable   Repayable   Total                  
      Rm   within 1 year   1 – 5 years                    
      Financial liabilities                                        
      Non-current and current liabilities – interest-bearing borrowings   685.1   2,939.2   3,624.3                  
      – Medium-term loans                        
      – Medium-term bank loans   616.1   2,291.1   2,907.2                  
      – Capitalised finance lease   69.0   648.1   717.1                  
      Non-current liabilities – interest-free borrowings                        
      – Loans to non-controlling interests                        
      Trade and other payables   21,797.8     21,797.8                  
      – Trade payables   18,698.2     18,698.2                  
      – FEC liability   24.8     24.8                  
      – Sundry payables and other accruals   3,074.8     3,074.8                  
      Bank overdrafts   1,744.0     1,744.0                  
      Total undiscounted cash flows of the Group’s financial liabilities   24,226.9   2,939.2   27,166.1                  
      Less: Future finance charges           (16,058.2)                  
      Total financial liabilities           11,107.9                  
                                               
      Included in future finance charges is R15.6 billion that relates to finance leases. Finance lease interest charges of R24.6 million are repayable in year 1, R107.8 million in years 1 – 5, and R15,5 billion in greater than 5 years respectively.          
                                               
      December 2017   Repayable   Repayable   Total                  
      Rm             within 1 year   1 – 5 years                    
      Financial liabilities                              
      Non-current and current liabilities – interest-bearing borrowings   1,531.7   3,911.8   5,443.4                  
      – Medium-term loans   857.7     857.7                  
      – Medium-term bank loans   608.6   2,732.1   3,340.7                  
      – Capitalised finance lease   65.4   1,179.7   1,245.0                  
      Non-current liabilities – interest-free borrowings     2.0   2.0                  
      – Loans to non-controlling interests     2.0   2.0                  
      Trade and other payables   19,288.5     19,288.5                  
      – Trade payables   17,396.7     17,396.7                  
      – FEC liability   52.5     52.5                  
      – Sundry payables and other accruals   1,839.3     1,839.3                  
      Bank overdrafts   87.5     87.5                  
      Total undiscounted cash flows of the Group’s financial liabilities   20,907.7   3,913.8   24,821.4                  
      Less: Future finance charges           (16,335.3)                  
      Total financial liabilities           8,486.1                  
                 
      Included in future finance charges is R15.6 billion that relates to finance leases. Finance lease interest charges of R19.3 million are repayable in year 1, R90.9 million in years 1 – 5, and R14,8 billion in greater than 5 years respectively.          
      The effect of discounting on the current medium-term loan amounts are deemed immaterial.          
      The average duration of the FEC’s are three months, so they would fall in the repayable within one year for both periods under review. The FEC’s are settled on a net basis.          
                                               
                                               
      Analysis of cash flows from financing activities                  
                      Reclassification              
                                             
      Rm             Opening balance   Restatement*   Cash flows     Capitalised finance Lease   Other   Closing balance  
                                               
      December 2018                                        
      Non-current – interest-bearing borrowings   2,553.0       (583.6)   (83.4)   146.7   14.1   2,254.6  
      – Medium-term loans                  
      – Medium-term bank loans   2,245.0     (583.6)       14.1   1,675.5  
      – Capitalised finance lease   308.0   207.8     (83.4)   146.7     579.1  
      Non-current liabilities – interest-free borrowings   2.0     (0.1)         1.9  
      – Loans to non-controlling interests   2.0     (0.1)         1.9  
      Other current liabilities   1,262.0     1,043.5   83.4     25.0   2,428.6  
      – Medium-term loans   850.2     (621.3)   361.7     25.0   615.6  
      – Bank overdraft             361.7     1,744.0   (361.7)           1,744.0  
      – Capitalised finance lease   50.1   14.7   (79.2)   83.4       69.0  
                                               
      December 2017                                        
      Non-current – interest-bearing borrowings   3,301.9     (403.3)   (645.2)   299.6     2,553.0  
      – Medium-term loans   600.0       (600.0)          
      – Medium-term bank loans   2,648.3     (403.3)         2,245.0  
      – Capitalised finance lease   53.6       (45.2)   299.6     308.0  
      Non-current liabilities – interest-free borrowings   1.9           0.1   2.0  
      – Loans to non-controlling interests   1.9           0.1   2.0  
      Other current liabilities   1,024.5     (433.1)   645.2   25.5 (0.1)   1,262.0  
      – Medium-term loans   438.2     (187.9)   600.0     (0.1)   850.2  
      – Bank overdraft             561.7     (200.0)         361.7  
      – Capitalised finance lease   24.6     (45.2)   45.2   25.5     50.1  
                                               
                                               
      Credit risk management                  
                                               
      The carrying amount of the financial assets represents the Group’s maximum exposure to credit risk without taking into consideration any collateral provided. Other Debt instruments at amortised cost are considered to be of low credit risk for the current and prior financial year.          
                 
      Potential areas of credit risk include trade receivables and short-term loans and cash investments. Credit risk arises from the risk that a counterparty may default or not meet its obligations timeously. Trade accounts receivable consist primarily of a large, widespread customer base. Group companies regularly monitor the financial position of their customers. Where considered appropriate, credit guarantee insurance is used. The granting of credit is controlled by application and account limits. Provision is made for both specific and general portfolio impairments, and at the year end management did not consider there to be any material credit risk exposure that was not already covered by credit guarantee insurance or portfolio impairment provisions. The carrying amounts of the financial assets above represent the Group’s maximum credit risk exposure. Additional information relating to trade and other receivables can be found in note 18.          
                 
      At year end no Debt instruments at amortised cost were pledged as security. At year end, security with a fair value of R2.6 million (December 2017: R2.6 million) is held by the Group. During the current year the Group did not take possession of security it held over its Debt instruments at amortised cost.          
    * Refer to note 41.                                        
  • + 39. Segmental reporting
                             
    39. Segmental reporting    
                             
    Operating segments                        
                             
    The Group is organised into four Divisions for operational and management purposes, being Massdiscounters, Masswarehouse, Massbuild and Masscash. Massmart reports its operating segment information on this basis. The principal offering for each Division is as follows:
    Massdiscounters – general merchandise discounter and food retailer
    Masswarehouse – warehouse club trading in food, general merchandise and liquor
    Massbuild – home improvement retailer and building materials supplier
    Masscash – food wholesaler, retailer and buying association
    No single customer represented more than 10% of any of one of the Divisions’ revenue in the current and prior financial year.
                             
    Rm   Total   Other   Massdiscounters   Masswarehouse   Massbuild   Masscash
                             
    December 2018                        
                             
    Sales   90,941.6     19,729.4   28,778.2   13,756.1   28,677.9
    Operating profit before foreign exchange movements and interest   1,894.5   (5.9)   (97.1)   1,103.3   750.5   143.7
    Trading profit before interest and taxation   2,071.1     32.6   1,100.8   749.1   188.6
    Net foreign exchange loss   (2.7)   (42.8)   0.9     15.5   23.7
    Net finance costs   (623.7)   (81.4)   (136.0)   (130.8)   (198.9)   (76.6)
    Operating profit/(loss) before taxation   1,268.1   (130.1)   (232.2)   972.5   567.1   90.8
    Trading profit/(loss) before taxation   1,447.4   (81.4)   (103.4)   970.0   550.2   112.0
                             
    Inventory   12,180.9   5.3   3,839.0   2,871.1   2,006.6   3,458.9
    Total assets   34,782.6   5,880.3   7,606.0   6,838.1   5,253.2   9,205.0
    Non-current asset held for sale   11.6   9.8       1.8  
    Total liabilities   28,253.9   4,455.4   6,042.7   7,478.4   3,786.8   6,490.6
                             
    Net capital expenditure   1,606.0   271.5   517.3   271.7   297.3   248.2
    Depreciation and amortisation   1,134.6   64.6   374.4   251.4   250.2   194.0
    Impairment losses   21.4   6.8   14.6      
    Non-cash items other than depreciation and impairment   395.8   24.3   189.5   100.5   47.5   34.0
                             
    Cash flow from operating activities   1,342.0   (197.4)   710.7   170.9   879.3   (221.5)
    Cash flow from investing activities   (1,546.9)   (2,046.9)   1,287.5   (248.7)   (301.1)   (237.8)
    Cash flow from financing activities   238.7   446.1   (93.8)   31.0   (572.9)   428.3
                             
    Inventory days   62.0     99.0   44.0   79.0   52.0
    Number of stores   436     171   21   114   130
    Trading area (m2)   1,648,718     560,828   231,021   468,155   388,714
    Trading area (m2) increase on December 2017   2.2%     2.2%   0.0%   2.6%   3.1%
    Average trading area per store (m2)   3,781     3,280   11,001   4,107   2,990
    Distribution centre space (m2)   353,716     157,957   86,610   64,728   44,421
    Distribution centre space (m2) increase/(decrease) on December 2017   4.4%     0.4%   27.7%   0.0%   -9.2%
                             
                             
                             
    Rm   Total   Other   Massdiscounters   Masswarehouse   Massbuild   Masscash
                             
    Restated December 2017                      
                             
    Sales   93,735.2     20,330.6   27,748.9   13,191.9   32,463.8
    Operating profit before foreign exchange movements and interest   2,777.2   (5.2)   474.8   1,313.1   798.2   196.3
    Trading profit before interest and taxation   2,743.9     454.3   1,313.1   797.5   179.0
    Net foreign exchange (loss)/ gain   (47.2)   (31.2)   (19.6)     2.2   1.4
    Net finance (costs)/income   (577.1)   (156.5)   (108.0)   (107.9)   (142.0)   (62.7)
    Operating profit/(loss) before taxation   2,152.9   (192.9)   347.2   1,205.2   658.4   135.0
    Trading profit/(loss) before taxation   2,184.9   (138.4)   346.3   1,205.2   655.5   116.3
                             
    Inventory   10,984.6   49.3   3,248.8   2,894.1   1,787.9   3,004.5
    Total assets   32,488.8   3,214.2   7,131.9   7,448.2   6,151.5   8,543.0
    Non-current asset held for sale   19.9   19.9        
    Total liabilities   26,147.1   (3,458.9)   7,308.6   8,203.5   5,392.6   8,701.3
                             
    Net capital expenditure   1,794.5   162.1   373.4   405.9   521.1   332.0
    Depreciation and amortisation   1,099.6   82.7   343.0   221.4   236.1   216.4
    Impairment losses   18.9   (0.9)   16.5   1.3   0.3   1.7
    Non-cash items other than depreciation and impairment   200.5   71.0   91.8   27.9   (27.3)   37.1
                             
    Cash flow from operating activities   2,676.4   796.3   1,129.2   971.5   (697.2)   476.6
    Cash flow from investing activities   (1,806.7)   (475.2)   (373.4)   (380.8)   (240.1)   (337.2)
    Cash flow from financing activities   (1,146.6)   (1,217.7)   (852.6)   196.6   897.3   (170.2)
                             
    Inventory days   54.0     81.0   46.0   71.0   38.0
    Number of stores   423     166   21   108   128
    Trading area (m2)   1,612,916     548,544   231,021   456,313   377,038
    Trading area (m2) increase on December 2016 (excluding re-measurements)   2.8%     0.6%   6.0%   1.6%   5.8%
    Average trading area per store (m2)   3,813     3,304   11,001   4,225   2,946
    Distribution centre space (m2)   338,784     157,265   67,847   64,728   48,944
    Distribution centre space (m2) (decrease)/increase on December 2016   0.5%     -1.8%   0.0%   7.5%   0.0%
                             
                             
    The other column includes consolidation entries.
    All intercompany transactions have been eliminated in the above results.
    Additional information can be found in ‘Our Customers’ and the ‘Chief Financial Officer’s Review’ in the Group’s Integrated Annual Report.
    Trading profit before taxation is earnings before corporate net interest, asset impairments, BEE transaction IFRS 2 charges and foreign exchange movements.
    Net capital expenditure is defined as capital expenditure less disposal proceeds.
                             
    Geographic segments
     
    The Group’s four Divisions operate in two principal geographical areas – South Africa and the rest of Africa.
         
        December 2018   Restated December 2017
        52 weeks   53 weeks*
        Total   South Africa   Rest of Africa   Total   South Africa   Rest of Africa
                             
    Sales   90,941.6   83,053.5   7,888.1   93,735.3   86,039.6   7,695.7
    Segment assets (Total)   34,782.6   31,172.1   3,610.5   24,369.0   23,351.5   1,017.5
    Segment assets (Non-current)   14,165.8   13,073.1   1,092.7   12,593.6   12,048.5   545.1
    Net capital expenditure   1,606.0   1,479.7   126.2   1,806.7   1,712.9   93.8
                             
                             
    Disagregation of revenue by major categories   Total   South Africa   Rest of Africa            
    Food and Liquor   50,912.9   46,920.7   3,992.3            
    Durables   40,028.7   36,132.9   3,895.8            
    Total   90,941.6   83,053.5   7,888.1            
                             
    All intercompany transactions have been eliminated in the above results.
    Segment assets excludes financial instruments and deferred taxation and reflects the geographic location of the Group’s assets.
    Net capital expenditure is defined as capital expenditure less disposal proceeds.
                             
  • + 40. Value Added Statement
                     
    40. Value Added Statement                
                     
                     
        December 2018       Restated
    December 2017
       
    Rm   52 weeks   %   53 weeks*   %
                     
    Sales     90,941.6         93,735.2    
    Cost of sales     (73,250.4)         (76,084.6)    
    Other revenue and interest received     264.1         320.3    
    Net costs of services and other operating expenses     (7,295.5)         (6,688.9)    
    Value added     10,659.8         11,282.0    
                     
    Applied as follows :                
    – To employees as salaries, wages and other benefits     7,582.9     71.2     7,402.9     65.8
    – To Government as taxation (excluding VAT)     399.4     3.7     644.0     5.7
    – To shareholders as dividends     744.0     7.0     688.6     6.1
    – To lenders as interest     648.8     6.1     603.5     5.3
    – Depreciation and amortisation     1,134.6     10.6     1,099.6     9.7
    – Non-controlling interests     (19.9)     (0.2)     14.0     0.1
    – CSI     25.4     0.2     23.2     0.2
    – Net earnings retained     144.6     1.4     806.2     7.1
          10,659.8     100.0     11,282.0     100.0
                     
    * Refer to note 41.                
  • + 41. Restatement of comparative figures and additional disclosures
                             
       
    41. Restatement of comparative figures and additional disclosures
                             
    During the IFRS 16 implementation project, an error in accounting was identified relating to a long-term lease of land. This 99 year lease arrangement that was entered into in 1994 for the Makro Woodmead Store was incorrectly accounted for on a month-to-month basis as an operating lease and should have been accounted for as a finance lease. The error has been corrected by restating the comparative 2017 and 2016 figures as follows:
     
        December 2017   December 2016
        53 weeks   52 weeks
                             
    Rm   Audited   Impact   Restated   Audited   Impact   Restated
                             
    Statement of financial position                        
    Property, plant and equipment     9,214.7     153.4     9,368.1     8,470.2     157.6     8,627.8
    Deferred Taxation     652.6     19.3     671.9     722.0     14.3     736.3
    Total assets     9,867.3     172.7     10,040.0     9,192.2     171.9     9,364.1
    Non-current Interest-bearing borrowings     2,553.0     207.8     2,760.8     3,301.9     194.8     3,496.7
    Current interest bearing borrowings     1,262.0     14.7     1,276.7     1,024.5     13.8     1,038.3
    Total liabilities     3,815.0     222.4     4,037.4     4,326.4     208.6     4,535.0
    Net impact on equity         (49.7)             (36.8)    
                             
                             
    Income Statement                        
    Depreciation and amortisation     (1,095.4)     (4.2)     (1,099.6)            
    Occupancy costs     (3,187.0)     4.4     (3,182.6)            
    Trading profit before interest and taxation     2,737.1     0.2     2,737.3            
    Finance costs     (585.4)     (18.1)     (603.5)            
    Profit before taxation     2,170.8     (17.9)     2,152.9            
    Taxation     (649.1)     5.0     (644.0)            
    Profit for the year         (12.9)                
    Profit attributable to:                        
    – Owners of the parent     1,507.7     (12.9)     1,494.9            
    – Non-controlling interests     14.0       14.0            
              (12.9)                
                             
                             
    Basic EPS (cents)     700.3     (6.0)     694.3            
    Diluted basic EPS (cents)     687.3     (5.9)     681.4            
    Headline EPS (cents)     694.1     (6.0)     688.1            
    Diluted headline EPS (cents)     681.2     (5.9)     675.3            
                             
    Statement of cash flows                        
    Operating cash before working capital movements     3,964.7     4.4     3,969.1            
    Decrease in working capital movements     (433.2)     (4.4)     (437.6)            
                             
                             
                             
                             
        June 2018   June 2017
        26 weeks   26 weeks
                             
    Rm   Audited   Impact   Restated   Audited   Impact   Restated
                             
    Statement of financial position                        
    Property,plant and equipment     9,269.6     151.3     9,420.9     8,655.0     155.5     8,810.5
    Deferred Taxation     748.1     22.0     770.1     662.5     16.7     679.2
    Total assets     10,017.7     173.3     10,191.0     9,317.5     172.2     9,489.7
    Non-current Interest-bearing borrowings     1,746.7     213.7     1,960.4     2,467.2     200.4     2,667.6
    Current interest bearing borrowings     1,009.7     16.1     1,025.8     1,516.6     15.1     1,531.7
    Total liabilities     2,756.4     229.7     2,986.2     3,983.8     215.5     4,199.3
    Net impact on equity         (56.5)             (43.3)    
                             
                             
    Income Statement                        
    Depreciation and amortisation     (544.6)     (2.1)     (546.7)     (542.0)     (2.1)     (544.1)
    Occupancy costs     (1,708.9)     2.3     (1,706.6)     (1,626.6)     2.2     (1,624.4)
    Trading profit before interest and taxation     664.2     0.2     664.4     825.2     0.1     825.3
    Finance costs     (300.9)     (9.7)     (310.6)     (294.6)     (9.1)     (303.7)
    Profit before taxation     280.8     (9.4)     271.4     533.1     (9.0)     524.1
    Taxation     (84.0)     2.6     (81.4)     (159.9)     2.5     (157.4)
    Profit for the year         (6.8)             (6.5)    
    Profit attributable to:                        
    – Owners of the parent     202.5     (6.8)     195.7     369.3     (6.5)     362.8
    – Non-controlling interests     (5.7)     0.0     (5.7)     3.9     (0.0)     3.9
              (6.8)             (6.5)    
                             
                             
    Basic EPS (cents)     94.0     (3.1)     90.9     170.6     (3.0)     167.6
    Diluted basic EPS (cents)     92.1     (3.1)     89.0     167.7     (2.9)     164.8
    Headline EPS (cents)     97.9     (3.1)     94.8     168.5     (3.0)     165.5
    Diluted headline EPS (cents)     95.9     (3.1)     92.8     165.7     (3.0)     162.7
                             
    Statement of cash flows                        
    Operating cash before working capital movements     1,253.9     2.3     1,256.2     1,542.8     2.2     1,545.0
    Decrease in current liabilities     (332.4)     (2.3)     (334.7)     472.5     (2.2)     470.3
                             
                             
  • + 42. Events after the reporting date
    42. Events after the reporting date
    During the post reporting period the Group concluded a medium-term loan facility agreement to replace the medium-term loan. In terms of this agreement, R600.0 million was advanced to the Group on 27 February 2019 and the loan will mature in two years at an interest rate of 8.26%. With the exception of this, there were no significant subsequent events after the year end.
  • + 43. Shareholder analysis
                   
    43. Shareholder analysis          
                   
    The following analysis of shareholders was extracted from the shareholders register:
                   
      Number of holders   %   Number of shares   %
                   
                   
    Shareholder spread              
    1 – 1,000 shares   3,404     80.4     607,697     0.3
    1,001 – 10,000 shares   520     12.3     1,704,981     0.8
    10,001 – 100,000 shares   206     4.9     7,130,118     3.3
    100,001 – 1,000,000 shares   81     1.9     21,115,515     9.7
    1,000,001 shares and over   23     0.5     186,620,831     85.9
        4,234     100.0     217,179,142     100.0
                   
    Public/non-public shareholders              
    Non-public shareholders:              
    Walmart subsidiary: Main Street 830 Proprietary Limited   1       113,859,293     52.4
    Directors and Group Executives of the Company   4     0.1     230,294     0.1
    Share trusts   1       1,180,253     0.6
    Public shareholders   4,228     99.9     101,909,302     46.9
        4,234     100.0     217,179,142     100.0
                   
      Number of holders   %   Number of shares   %
                   
    Distribution of shareholders              
    Walmart subsidiary: Main Street 830 Proprietary Limited   1       113,859,293     52.4
    Unit Trusts/Mutual Funds   90     2.1     48,529,340     22.3
    Pension Funds   60     1.5     20,447,611     9.4
    Other Managed Funds   4,024     95.3     12,987,898     6.1
    Sovereign Wealth   6     0.1     6,877,858     3.2
    Custodians   5     0.1     922,692     0.4
    Private Investors   8     0.2     1,940,090     0.9
    Hedge Fund   17     0.4     5,308,041     2.4
    Investment Trusts   2       2,843,761     1.3
    Insurance Companies   14     0.3     2,662,328     1.2
    Exchange-Traded Fund Total   5     0.1     601,587     0.3
    Local Authorities   2       198,643     0.1
        4,234     100.0     217,179,142     100.0
                   
                   
    Custodians and managers holding 3% or more              
    The following custodians and managers held beneficially, directly or indirectly, equal to or in excess of 3% of the Company’s shares:              
    Walmart subsidiary: Main Street 830 Proprietary Limited           113,859,293     52.4
    Standard Life Aberdeen           7,040,386     3.2
    Public Investment Corporation           10,533,209     4.9
                   
  • + 44. Change in accounting standards
                 
    44. Change in accounting standards            
                 
    The Group has applied both IFRS 9 ‘Financial instruments’ and IFRS 15 ‘Revenue from contracts with customers’ using the modified retrospective approach, by recognising the cumulative effect of initially applying IFRS 9 and IFRS 15 as an adjustment to the opening balance of equity at 1 January 2018. Therefore the comparative information has not been restated and continues to be reported under IAS 18 ‘Revenue’ and IAS 39 ‘Financial instruments’. IFRS 9 has had an insignificant impact for the Group due to the low-value short-term nature of debtors. IFRS 15 key areas of impact are the changes in the principal versus agent recognition of sales in parts of the Masscash Division, particularly Shield, where sales are now recognised on a net basis and the recognition of the right of return liability and related right of return asset now recognised on a gross basis.
                 
    Several other amendments and interpretations apply for the first time in 2018, but do not have an impact on the consolidated financial statements of the Group. The Group has not early adopted any standards, interpretations or amendments that have been issued, but are not yet effective.
                 
    IFRS 9 Financial Instruments            
                 
    IFRS 9 Financial Instruments replaces IAS 39 Financial Instruments: Recognition and Measurement for annual periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting for financial instruments: classification and measurement; impairment; and hedge accounting.
                 
    The Group applied IFRS 9 prospectively, with an initial application date of 1 January 2018. Differences arising from the adoption of IFRS 9 have been recognised directly in retained earnings and other components of equity.
                 
    IFRS 15 Revenue from Contracts with Customers            
                 
    IFRS 15 supersedes IAS 18 Revenue and related Interpretations and it applies, with limited exceptions, to all revenue arising from contracts with customers. IFRS 15 establishes a five-step model to account for revenue arising from contracts with customers and requires that revenue be recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. IFRS 15 requires entities to exercise judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers.
     
    The Group adopted IFRS 15 using the modified retrospective method of adoption with the date of initial application of 1 January 2018. Under this method, the standard can be applied either to all contracts at the date of initial application or only to contracts that are not completed at this date. The Group elected to apply the standard to all contracts that are not completed as at 1 January 2018.
                 
    The effect of adopting IFRS 9 and IFRS 15 as at 1 January 2018 was, as follows:            
                 
                 
              Restated*  
    GROUP INCOME STATEMENT   52 weeks   52 weeks 53 weeks  
        December 2018 IFRS 15 & 9 December 2018 December 2017  
    Rm Reference (Audited) adjustment^ (Adjusted) (Audited)  
                 
    Revenue   91,180.6 4,419.9 95,600.5 94,029.1  
    Sales (a), (b), (d) 90,941.6 4,415.6 95,357.2 93,735.2  
    Cost of sales (a), (b) (73,250.4) (4,432.3) (77,682.7) (76,084.6)  
    Gross profit   17,691.2 (16.7) 17,674.5 17,650.6  
    Other income (c) 231.0 4.3 235.3 235.1  
    Other operating costs (f) (3,644.5) 1.6 (3,642.9) (3,463.3)  
    Trading profit before interest and taxation   2,068.9 (10.8) 2,058.1 2,737.3  
    Operating profit before foreign exchange movements and interest   1,894.5 (10.8) 1,883.7 2,777.2  
    Foreign exchange loss   (2.7) (2.7) (47.2)  
    Operating profit before interest   1,891.8 (10.8) 1,881.0 2,730.0  
    Profit before taxation   1,268.1 (10.8) 1,257.3 2,152.9  
    Taxation (g) (399.4) 2.8 (396.6) (644.0)  
    Profit for the year   868.7 (8.0) 860.7 1,508.9  
                 
    Profit attributable to:            
    – Owners of the parent   888.6 (8.0) 880.6 1,494.9  
    – Non-controlling interests   (19.9) (19.9) 14.0  
    Profit for the year   868.7 (8.0) 860.7 1,508.9  
                 
    Basic EPS (cents)   410.6 (3.7) 406.9 694.4  
    Diluted basic EPS (cents)   401.9 (3.6) 398.3 681.5  
    Dividend (cents):          
    – Interim   68.0 68.0 76.0  
    – Final   140.0 140.0 271.0  
    – Total   208.0 208.0 347.0  
                 
    HEADLINE EARNINGS            
                 
    Reconciliation of profit for the year to headline earnings            
    Profit for the year attributable to owners of the parent   888.6 (8.0) 880.6 1,494.9  
    Headline earnings   901.2 (8.0) 893.2 1,481.5  
    Restructuring after taxation   115.9 115.9  
    Headline earnings before restructure costs (taxed)   1,017.1 (8.0) 1,009.1 1,481.5  
                 
    Headline EPS (cents)   416.5 (3.7) 412.8 688.2  
    Headline EPS before restructure costs (taxed) (cents)   470.0 (3.7) 466.3 688.2  
    Diluted headline EPS (cents)   407.6 (3.6) 404.0 675.4  
    Diluted headline EPS before restructure costs (taxed) (cents)   460.1 (3.6) 456.4 675.4  
                 
    GROUP STATEMENT OF COMPREHENSIVE INCOME         Restated^  
        52 weeks   52 weeks 53 weeks  
        December 2018 IFRS15 & 9 December 2018 December 2017  
    Rm   (Audited) adjustment^ (Adjusted) (Audited)  
                 
    Profit for the period   868.7 (8.0) 860.7 1,508.9  
    Total comprehensive income for the period   972.6 (8.0) 964.6 1,424.2  
                 
    Total comprehensive income attributable to:            
    – Owners of the parent   992.5 (8.0) 984.5 1,410.2  
    – Non-controlling interests   (19.9) (19.9) 14.0  
    Total comprehensive income for the period   972.6 (8.0) 964.6 1,424.2  
                 
    CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION            
              Restated^ Restated^
        December 2018 IFRS15 & 9 adjustment^ December 2018 December 2017 December 2016
    Rm Reference (Audited) (Adjusted)* (Audited) (Audited)
    ASSETS            
    Current assets   20,605.2 (83.3) 20,521.9 18,893.8 18,905.9
    Inventories (d) 12,180.9 (77.8) 12,103.1 10,984.6 11,210.2
    Trade, other receivables and prepayments (d), (f) 5,693.2 (4.0) 5,689.2 5,119.1 4,684.7
    Taxation (g) 361.3 (1.5) 359.8 396.5 208.7
    Cash on hand and bank balances   2,369.8 2,369.8 2,393.6 2,802.3
    Non-current assets classified as held for sale   11.6 11.6 19.9 17.7
                 
    Total assets   34,782.6 (83.3) 34,699.3 32,488.8 31,610.9
                 
    EQUITY AND LIABILITIES            
    Total equity   6,528.6 (44.9) 6,483.7 6,341.7 5,719.0
    Equity attributable to owners of the parent (a), (b), (c) , (d), (f), (g) 6,514.0 (44.9) 6,469.1 6,298.5 5,644.5
    Non-controlling interests   14.6 14.6 43.2 74.5
    Non-current liabilities   3,694.5 (20.3) 3,674.2 4,142.4 4,917.2
    Interest-bearing borrowings   2,254.1 2,254.1 2,760.8 3,496.7
    Deferred taxation (g) 76.7 (20.3) 56.4 66.3 73.9
    Other non-current liabilities and provisions   1,363.7 1,363.7 1,315.3 1,346.6
    Current liabilities   24,559.5 (18.1) 24,541.4 22,004.7 20,974.7
    Trade, other payables and provisions (b), (c) 21,925.1 (18.1) 21,907.0 20,581.4 19,634.1
    Taxation (d) 205.3 205.3 59.1 121.6
    Bank overdrafts   1,744.0 1,744.0 87.5 180.6
    Interest-bearing borrowings   685.1 685.1 1,276.7 1,038.4
                 
    Total equity and liabilities   34,782.6 (83.3) 34,699.3 32,488.8 31,610.9
                 
    ^ IFRS 15 & 9 adjustments            
                 
    The nature of the adjustments as at 1 January 2018 and the reasons for the significant changes in the Income Statement for the year ended 30 December 2018 and the Statement of Financial Position as at 30 December 2018 are described below:  
                 
    1. IFRS 15 Revenue from Contracts with Customers            
                 
    a) Principal versus agent consideration            
                 

    The Group has certain contracts with customers to acquire, on their behalf, merchandise from suppliers. Before the adoption of IFRS 15, the Group concluded that, based on the existence of credit risk and the nature of the consideration in the contract, it had an exposure to the significant risks and rewards associated with the sale of the merchandise to its customers, and accounted for the contracts as a principal and therefore on a gross basis. Upon the adoption of IFRS 15, the credit risk judgement consideration is no longer taken into account and the Group determined that it did not control the goods before they are transferred to customers. Hence, it is an agent in these contracts as it does not have the ability to direct the use of the merchandise or obtain benefits from the merchandise, and accounts for the contracts on a net basis. This change did not affect the Statement of Financial Position. However, this change will result in decreases in revenue from the sale of goods and cost of sales and an increase in revenue from rendering of services by the difference.

    For the year ended 30 December 2018, IFRS 15 decreased both Revenue from contracts with customers and Cost of sales by R4,283.4 million.

     
                 
    (b) Bundled sales of merchandise and gift card vouchers            
                 
    Before the adoption of IFRS 15, the Group accounted for the merchandise and gift card vouchers as separate deliverables within bundled sales and allocated consideration to each deliverable using the relative fair value approach.  
                 
    Under IFRS 15, the Group assessed that there were two performance obligations in a contract for merchandise and gift card vouchers and performed a re-allocation of the transaction price based on their relative stand-alone selling prices, which decreased the amount allocated to gift card vouchers due to a revision of the deferred discount being remeasured.  
                 
    Therefore, Trade and other payables decreased by R12.4 million with a corresponding impact after tax increase in opening Retained earnings by R8.6 million as at 1 January 2018.  
       
    As at 30 December 2018, IFRS 15 decreased Trade and other payables by R13.5 million and increased Retained earnings by an after tax amount of R9.5 million. It also decreased Revenue from contracts with customers by R148.0 million and decrease cost of sales by R148.9 million for the year ended 30 December 2018.  
                 
    c) Variable consideration on gift cards            
                 
    The Group sells gift cards as either part of a bundle deal or as a separate purchase to customers. Before the adoption of IFRS 15, the Group concluded that the 3-year prescription period allowed a sufficient period of redemption to lapse and derecognised gift cards on that basis. Upon the adoption of IFRS 15, the Group estimates the variable consideration in proportion to the pattern of rights exercised by the customer where it is determined the likelihood of redemption is remote.  
                 
    Upon adoption of IFRS 15, the Group decreased the gift card contract liability in Trade and other payables by R50,9 million with a corresponding after tax increase in opening Retained earnings of R34.8 million.  
                 
    As at 30 December 2018, IFRS 15 decreased Trade and other payables by R46.2 million and increased Retained earnings by an after tax amount of R31.9 million. It also decreased Other income by R4.3 million for the year ended 30 December 2018.  
                 
    d) Variable consideration of Sale of merchandise            
                 
    Some contracts for the sale of merchandise provide customers with a right of return and other contracts the Group will receiving on-going revenue commission. Before adopting IFRS 15, the Group recognised revenue from the sale of goods measured at the fair value of the consideration received or receivable, net of returns and volume rebates. If revenue could not be reliably measured, the Group deferred recognition of revenue until the uncertainty was resolved. Under IFRS 15, rights of return and on-going revenue commssion gives rise to variable consideration.  
                 
    When a contract provides a customer with a right to return the goods within a specified period, the Group previously estimated expected returns using a 12 month rolling estimation method based on historic trends similar to the expected value method under IFRS 15. Before the adoption of IFRS 15, the amount of revenue related to the expected returns was deferred and recognised on a net basis as a provision for sales returns in the Statement of Financial Position with a corresponding gross adjustment to Sales and Cost of sales. The initial carrying amount of goods expected to be returned was included in Inventories.  
                 
    Before including any amount of variable consideration in the transaction price, the Group considers whether the amount of variable consideration is constrained. The Group determines variable consideration based on its historical experience, business forecast and the current economic conditions and assesses against these components in determining the respective constraints. In addition, the uncertainty on the variable consideration will be resolved within a short time frame.  
                 
    Under IFRS 15, the consideration received from the customer is variable because the contract allows the customer to return the products. The Group continued to use the expected value method to estimate the goods that will not be returned. Upon adoption of IFRS 15, the Group recognised R85.0 million right of return asset in Inventory and the corresponding entry raised in Provisions. There was no impact on Retained earnings.  
                 
    As at 30 December 2018, IFRS 15 increased the Right of return assets and Right of return liabilities by R77.8 million respectively. Ongoing revenue commission of R15,8 million was raised in revenue with a corresponding increase in trade and other receivables of R15.8 million with an after tax increase on retained earnings of R11.4 million.  
                 
    2. IFRS 9 Financial Instruments            
                 
    e) Classification and measurement            
                 
    Under IFRS 9, debt instruments are subsequently measured at fair value through profit or loss, amortised cost, or fair value through OCI. The classification is based on two criteria: the Group’s business model for managing the assets; and whether the instruments’ contractual cash flows represent ‘solely payments of principal and interest’ on the principal amount outstanding.  
     
                 
    The assessment of the Group’s business model was made as of the date of initial application, 1 January 2018. The assessment of whether contractual cash flows on debt instruments are solely comprised of principal and interest was made based on the facts and circumstances as at the initial recognition of the assets.  
     
                 
    The classification and measurement requirements of IFRS 9 did not have a significant impact to the Group. The Group continued measuring at fair value all financial assets previously held at fair value under IAS 39. The following are the changes in the classification of the Group’s financial assets:  
     
                 
    – Trade receivables and Other non-current financial assets (i.e., Share trust loans and other) classified as Loans and receivables as at 31 December 2017 are held to collect contractual cash flows and give rise to cash flows representing solely payments of principal. These are classified and measured as Debt instruments at amortised cost beginning 1 January 2018.  
     
                 
    – Listed equity investments classified as AFS financial assets as at 31 December 2017 are classified and measured as OCI Financial assets with the fair value changes continuing to be recognised in Equity but are no longer re-classified to profit and loss beginning 1 January 2018.  
     
                 
    There are no changes in classification and measurement for the Group’s financial liabilities.  
                 
    (f) Impairment            
                 
    The adoption of IFRS 9 has fundamentally changed the Group’s accounting for impairment losses for financial assets by replacing IAS 39’s incurred loss approach with a forward-looking expected credit loss (ECL) approach. IFRS 9 requires the Group to recognise an allowance for ECLs for all debt instruments not held at fair value through profit or loss and contract assets.  
     
                 
    Upon adoption of IFRS 9 the Group recognised additional impairment on the Group’s Trade receivables of R10.2 million, which resulted in a decrease of an after tax amount of R7.0 million in opening Retained earnings and a decrease of R0.7 million adjustment to FCTR as at 1 January 2018.  
     
                 
    As at 30 December 2018, IFRS 15 decreased Trade and other receivables by R11.8 million and decreased Retained earnings by an after tax amount of R7.9 million. It also increased Other operating costs by R1.6 million for the year ended 30 December 2018.  
     
                 
    Other adjustments            
                 
    (g) Deferred taxation and Current taxation            
                 
    In addition to the adjustments described above, other items such as deferred taxes were adjusted to retained earnings as necessary upon adoption of IFRS 15 & IFRS 9 as at 1 January 2018.