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Contents PageCorporate Information 02

Notice of Annual General Meeting 03

Result at a Glance 04

Directors 05

Report of the Directors 06

Corporate Governance Report 09

Statement of Directors’ Responsibilities 11

Report of the Audit Committee 13

Independent Auditors’ Report 10

Consolidated Statement of Profit or Lossand other Comprehensive Income 15

Consolidated Statement of Financial Position 16

Consolidated Statement of changes in Equity 18

Consolidated Statement of Cash Flows 19

Notes to the Consolidated Financial Statements 21

Consolidated Statement of Value Added 76

Five-Year Financial summary - Company 77

Notes 79

e-Dividend Activation Form 81

Proxy Form 83

02SWAP Technologies & Telecomms Plc. Annual Report & Accounts 2014

DIRECTORS: Adokpaye Godwin - Chairman Titilayo Olatunde - Vice Chairman Kesavan Madhavarao - Ag.Group Chief Executive Officer Ogunlesi Adegbola Soyoye Funso Semenitari James Henry - Resigned w.e.f. November 28, 2013

COMPANY SECRETARY: A.K. Nominees Management Services Limited 18, Otunba Adedoyin Ogungbe Crescent Off Omorinre Johnson Street Lekki Phase 1 Lagos

CORPORATE ADDRESS: Plot 1, Block 128b, New Creation Street Off Remi Olowude Way Lekki Phase 1, Lagos

REGISTERED OFFICE: Plot 1, Block 128b, New Creation Street Off Remi Olowude Way Lekki Phase 1, Lagos

LEGAL ADVISERS: Adeniji Kazeem & Co. 18, Otunba Adedoyin Ogungbe Crescent Off Omorinre Johnson Street Lekki Phase 1, Lagos

FINANCIAL ADVISERS: PAC Capital Plc 8A, Elsie Femi Pearse Street Victoria Island, Lagos

REGISTRAR: PAC Registrars Limited 122, Bode Thomas Street Surulere, Lagos

AUDITORS: Ernst & Young Yinka Adesanya & Co (Chartered Accountants) (Chartered Accountants) UBA Building NACCIMA Building 10th and 13th Floor 8A, Oba Akinjobi Road, GRA 57 Marina, Lagos Ikeja, Lagos

BANKERS: African Import – Export Bank (Afreximbank) First Bank of Nigeria Plc Diamond Bank Plc

CORPORATE INFORMATION

03 SWAP Technologies & Telecomms Plc.Annual Report & Accounts 2014

NOTICE OF AGM

NOTICE is hereby given that the Annual General Meeting of SWAP Technologies & Telecomms Plc (the “Company”) will be held on 12th day of June, 2018 at The Peninsula Hotel & Towers, Lekki-Epe Expressway,

after Lekki Phase 1 Roundabout, (beside Bras Motors) Lekki, Lagos at 11 am, to transact the following business:

ORDINARY BUSINESS1. To receive the audited financial Statements for the year ended 30th June 2013 and the Chairman’s,

Directors’ and auditors’ report thereon.2. To receive the audited financial Statements for the year ended 30th June 2014 and the Chairman’s,



Directors’ and auditors’ report thereon.5. To elect/re-elect Directors.6. To fix the remuneration of Directors. 7. To appoint Auditors to the Company8. To authorize Directors to fix the remuneration of the Auditors.9. To elect/re-elect members of the Audit Committee.

SPECIAL BUSINESSTo consider and if thought fit, pass the following resolution as a Special resolution:

1. The change of the Company’s name from SWAP Technologies & Telecomms Plc to SWAP Plc

Dated this 21st day of May, 2018

AK NOMINEES Registered Office:Company Secretaries Plot 1, Block 128B, New Creation Street1B, Adedoyin Ogungbe Street Off Remi Olowude WayOff Omorinre Johnson Street Lekki Phase 1, Lagos.Lekki Phase 1, Lagos.

NOTES:1. PROXY: A member of the company entitled to attend and vote at the Annual General Meeting is entitled to

appoint a proxy in his/her stead. A proxy needs not be a member of the Company. All instruments of proxy should be duly stamped by the commissioner of Stamp Duties and deposited at the Registrar’s Office, PAC Registrars Limited - 122, Bode Thomas Street, Surulere, Lagos not later than 48 hours before the time for holding the meeting. A corporate body being a member of the company is required to execute a proxy under seal.

2. CLOSURE OF REGISTER OF MEMBERS AND TRANSFER BOOKS: The Register of Members and Transfer Books of the Company will close on June 2, 2018 to facilitate the

preparation of the Register for the AGM by the Registrars.


Group Company 2014 2013 2014 2013 N’000 N’000 N’000 N’000

Revenue 3,450,538 5,319,146 2,936,066 4,340,917

Loss before taxation (5,607,468) (6,891,887) (5,327,863) (6,713,561)Taxation 11,660 5,503 (7,068) (11,336)

Loss after taxation (5,595,808) (6,886,384) (5,334,931) (6,724,897)Other comprehensive income 3,272 (5,329) (831) (5681)

Total Comprehensive income (5,592,536) (6,891,713) (5,335,762) (6,730,577)

Total Assets 16,468,684 19,594,685 16,438,483 19,315,274

Net (Liabilities)/Assets (14, 348,836) (8,756,300) (13,748,097) (8,412,235)

Shareholders’ funds (14, 348,836) (8,756,300) (13,748,097) (8,412,235) Issued and fully paid share capital 1,352,689 1,352,689 1,352,689 1,352,689Loss per share (207k) (255k) (197k) (249k)Net (Liabilities)/Assets per share (530k) (324k) (508k) (311k)

RESULT AT A GLANCEFOR THE YEAR ENDED 30 JUNE 2014


BOARD OF DIRECTORS

GODWIN T. S. ADOKPAYE - ChairmanMr Adokpaye holds a B.A. Honours degree in Classics from the University of

Ibadan. He worked with Mobil Oil Nigeria Plc from 1959 and rose through the ranks before finally retiring from an executive position in December 1984. He is on the board of FCMB Bank Plc and is currently the Chairman of the Bank’s

Audit Committee. He is also the chairman of First Capital Trust Limited.

OLATUNDE TITILAYOGroup Vice ChairmanMr. Titilayo is a graduate of Electrical and Electronics Engineering (B.Sc. degree) from the Obafemi Awolowo University, Ile Ife. He has over the past 20 years gained wide

ADE OGUNLESIMr. Ogunlesi is a successful entrepreneur. He manages Sofisticat Limited and Skin Beauty Limited, a successful manufacturing outfit in Lagos. He obtained his first degree from University of Lagos and an

HENRY JAMES SEMENITARI Mr. Semenitari was until recently an Executive Director with FCMB Bank Plc where he was responsible for the commercial banking division of the bank. He had over 19 years banking experience in various areas

EMMANUEL OLUFUNSO SOYOYEMr. Soyoye holds a Masters (M.Sc.) degree in Finance from the University of Lagos and a Bachelors degree (Upper Honors) in Business Administration from Ogun State

experience in sectors like engineering, consulting, banking and Telecomms. He also has an MBA degree from IESE Business School, Barcelona. He is on the Board of Nigerian American Chambers of Commerce and a member of Institute of Directors (IOD).

including commercial and retail banking, corporate banking, operations and internal control. He holds a Bachelors Degree in Chemical Engineering from University of Lagos and MBA from University of Navarra (I.E.S.E), Barcelona Spain.

MBA from IESE Business School in Barcelona. He has over 20 years of experience in Business Management.

University. He is an alumnus of the Lagos Business School (CEP18) and other Management Development Programs at IESE Business School, IMD Laussane and Management Center Europe. He has over 20 years in Corporate Strategy, Finance and Business Development. He is the Managing Director and Chief Executive Officer of Pebnic Ventures Limited.


The directors present their report on the state of affairs of Swap Technologies and Telecomms Plc (“the Company”) together with the consolidated audited financial statements for the year ended 30 June 2014.

PRINCIPAL ACTIVITIESThe principal activities of the Company are the provision of infrastructure sharing (co-location) services, turnkey site deployment and cell site management services to the telecoms industry.

STATE OF AFFAIRSIn the opinion of the Directors, the State of the Company’s affairs is satisfactory and all events occurring after the balance sheet date have been adequately disclosed in the financial statement.

LEGAL STATUSThe company was incorporated in 2003 as a private Limited Liability Company in Nigeria and became a Plc in 2008.

RESULT FOR THE YEAR Group Company 2014 2013 2014 2013 N’000 N’000 N’000 N’000

Revenue 3,450,538 2,936,066 5,319,146 4,340,917 Loss before taxation (5,607,468) (6,891,887) (5,327,863) (6,713,561)Taxation 11,660 5,503 (7,068) (11,336)

Loss after taxation (5,595,808) (6,886,384) (5,334,931) (6,724,897)Other comprehensive income 3,272 (5,329) (831) (5681)

Total Comprehensive income (5,592,536) (6,891,713) (5,335,762) (6,730,578)

DIVIDENDThe directors do not recommend the payment of dividend during the year.

FUTURE DEVELOPMENTSThe company intends to carry on fulfilling its objectives as stated in the Memorandum and Articles of Association.

DIRECTORSThe names of Directors at the date of this report and of those who held office during the year are as follows: Adokpaye Godwin - Chairman Titilayo Olatunde - Vice Chairman Kesavan Madhavarao - Ag. Group Chief Executive Officer Ogunlesi Adegbola Soyoye Funso Semenitari James Henry - Resigned w.e.f. November 28, 2013

DIRECTORS’ INTERESTS

ShareholdingDirector Direct Indirect Total %Adokpaye Godwin 6,428,571 6,428,571 0.24Titilayo Olatunde - 1,322,368,000 1,322,368,000 48.88Semenitari James Henry 3,428,571 3,428,571 0.13Ogunlesi Adegbola 5,000,000 5,000,000 0.18Soyoye Funso 2,500,000 400,000 2,900,000 0.11

17,357,142 1,322,768,000 1,340,125,142 49.54

REPORT OF THE DIRECTORSFOR THE YEAR ENDED 30 JUNE 2014


ContractsNone of the Directors has notified the Company for the purpose of section 277 of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004, of any discloseable interest in contracts with which the Company is involved as at 30 June 2014.

BENEFICIAL OWNERSHIPNo single shareholder other than the under listed held 5% or more of the issued and fully paid share capital of the Company as at 30 June 2014.

Shareholder No. of Shares Percentage Held SWAP Associate Limited 1,322,368,000 48.88 Keystone Bank 230,000,000 8.50 PAC Capital Nominees 200,000,000 7.39

EMPLOYMENT OF PHYSICALLY CHALLENGED PERSONNo physically challenged person was employed by the Company during the year. It is the Company’s policy to consider physically challenged persons for employment if academically and medically qualified.

HEALTH, SAFETY AND WELFARE AT WORK OF EMPLOYEESHealth and safety regulations are in force within the premises and sites of the Company. The Company provides or subsidise transportation, lunch and medical facilities to all levels of employees.

EMPLOYEES’ INTEREST AND TRAININGThe company places a high premium on consultation with employees on matters affecting them. In addition, formal channels of communication are employed in keeping staff abreast of various factors affecting the performance of the Company.

The company organizes in-house training for its members of staff, and overseas courses are arranged when necessary.

AUDITORSThe auditors, Messrs Ernst & Young and Yinka Adesanya & Co, have indicated their willingness to continue in office as auditors in accordance with Section 357 (2) of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004.

March 23, 2016

REPORT OF THE DIRECTORSFOR THE YEAR ENDED 30 JUNE 2014


CORPORATE GOVERNANCE REPORT FOR THE YEAR ENDED 30 JUNE 2014

SWAP Technologies and Telecomms Plc has continued in its commitment to ensuring that it takes account of and complies with the principles of good corporate governance. SWAP recognizes that good corporate governance is an important but distinct task from management. The Board of SWAP recognizes the place of good corporate governance in ensuring that the pursuit of the Company’s purpose is undertaken in a manner that effectively promotes the long term interest of the Company’s stakeholders. Corporate Governance is overseen by the Company’s Board of Directors while the day to day management is delegated to the Chief Executive Officer.

The Securities and Exchange Commission Code of Best Practices on corporate governance, the Nigerian Communications Commission regulations (including the Client Code of Practice), Nigerian Environmental Standards and Regulations Enforcement Agency guidelines, Local Governments, States and Federal Laws and the general principles of corporate social responsibility are some of the basis on which our corporate governance ideals rest.

GOVERNANCE STRUCTURE

ShareholdersThe shareholders are the highest decision-making body of SWAP, subject to the Company’s Memorandum and Articles of Incorporation, Company and Allied Matters Act and any other applicable legislation. Attendance of the Company’s Annual General Meeting (AGM), held once in a year (with a break in the past four years due to operational challenges), is open to shareholders and their proxies; with proceedings monitored by members of the press, representatives of Securities and Exchange Commission and Corporate Affairs Commission.

The BoardThe Board recognizes its separate and unique role as the link in the chain of authority between the shareholders and the Company’s Executive Management. The ultimate responsibility for governance rests with the Board of Directors of the Company, whose duty it is to ensure that appropriate controls, systems and practices are in place.

The Board during the 2014 financial year comprised of 5 members including the Chairman, the Vice Chairman and 3 Non-executive Directors. The position of the Chairman and the Managing Director are separate and distinct. With 1 executive director on the board, the Company’s Code of Corporate Governance provides for more non-executive directors of such calibre as to make constructive contributions and for their views to carry significant weight in the board’s deliberations. There is no shadow or alternate director and independent thought is brought to bear on the decisions of the board.

The Board ensures that the activities of the company are executed within the applicable regulatory frameworks at all times. The responsibilities of the Board include;

• Defining the company’s business strategy and objectives;• Considering and approving annual budgets, monitoring performance and ensuring that the company

is a going concern;• Formulating risk policies and making decisions on the establishment of foreign subsidiaries;• Assume ultimate responsibility for financial, operational and internal systems of control and ensure

adequate reporting on these by management

To maintain effective control over the company affairs and monitor the executive and management, the board meets quarterly and not less than once in a quarter as may be required by circumstances. The Board met over 4 times during the course of this financial year.

One of the features of the manner in which the board operates is the role played by board committees, which facilitate the discharge of board responsibilities.

The Standing CommitteesThe Board presently carries out its oversight functions through 2 standing committees namely: the Audit Committee and the Finance and General Purpose Committee. Each of these committees has a charter that clearly defines its purpose, composition, and structure, frequency of meeting, duties, tenure and reporting lines to the board.


The composition and structure of these committees are shown below.

Board Finance and General Purpose CommitteeThe Committee acts on behalf of the Board on all matters relating to management and reports to the Board for approval and ratification. The members are as follows:

Funso Soyoye ChairmanJ. Henry Semenitari Member (Resigned w.e.f 28 November 2013)Olatunde Titilayo Member

Responsibilities• The Committee is responsible for review and recommendation to the Board for approval of projects,

long term investments, contracts and purchases that entail major financial commitments on the part of the Company.

• To review, consider and make appropriate recommendations to the board on the general economic conditions as it could affect the fortunes of the company

• Review and make recommendations to the Board on the financing aspects of major capital commitments.

Board Audit CommitteeEstabilshed in compliance with section 359 (6) of the Companies and Allied Matters Act, 1990, the committee whose membership is stated below is, as specified by the Code of Corporate Governance, chaired by a Shareholder.

Kayode Abayom ChairmanFunso Soyoye MemberJ. Henry Semenitari Member (Resigned w.e.f 28 November 2013)Igbasanmi John Member (Died April 15, 2015)

The Company’s Chief Financial Officer and Head of Internal Audit have access and make quarterly presentations to the Committee. The Committee met 2 times during the 2014 financial year.

Responsibilities• Review the scope and results of the audit and the cost effectiveness, independence and objectivity of

the internal and external auditors• Review all issues relating to accounting and financial control practices of the Company• All such matters as are reserved to the Audit Committee by the Companies and Allied Matters Act.

The Board is presently considering creation of a Risk Management Committee towards enhancing the management standards of the Company’s level of exposure.

Directors’ AttendanceThe table below shows the frequency of meetings of the Board of Directors, board committees, and members’ attendance at these meetings, during the year under review

DIRECTORS Full Board Meeting Fin & G.P Comm Audit CommitteeNumber of Meetings 3 4 2

Godwin Adokpaye 3 N/A N/A Olatunde Titilayo 3 4 N/AAde Ogunlesi 3 N/A N/A Funso Soyoye 3 4 2Henry Semenitari 1 1 NIL

CORPORATE GOVERNANCE REPORT - continuedFOR THE YEAR ENDED 30 JUNE 2014


The Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004, requires the Directors to prepare consolidated financial statements for each financial year that give a true and fair view of the state of financial affairs of the Company at the end of the year and of its profit or loss. The responsibilities include ensuring that the company:

a) keeps proper accounting records that disclose, with reasonable accuracy, the financial position of the Company and comply with the requirements of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004 and Financial Reporting Council of Nigeria Act No 6, 2011.

b) establishes adequate internal controls to safeguard its assets and to prevent and detect fraud and other

irregularities; and

c) prepares its consolidated financial statements using suitable accounting policies supported by reasonable and prudent judgments and estimates, and are consistently applied.

The directors accept responsibility for the annual financial statements, which have been prepared using appropriate accounting policies supported by reasonable and prudent judgments and estimates, in conformity with International Financial Reporting Standards issued by the International Accounting Standards Board (IASB) and the requirements of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004 and Financial Reporting Council of Nigeria Act No 6, 2011.

The directors are of the opinion that the consolidated financial statements give a true and fair view of the state of the financial affairs of the Company and of its loss for the year ended 30 June 2014. The directors further accept responsibility for the maintenance of accounting records that may be relied upon in the preparation of financial statements, as well as adequate systems of internal financial control.Nothing has come to the attention of the directors to indicate that the company will not remain a going concern for at least twelve months from the date of this statement.

Titilayo Olatunde Soyoye FunsoDirector DirectorFRC/2013/IODN/2684 FRC/2013/IODN/2643March 23, 2016 March 23, 2016

STATEMENT OF DIRECTORS’ RESPONSIBILITIESFOR THE YEAR ENDED 30 JUNE 2014


To Members of SWAP Technologies & Telecomms Plc

In accordance with the provision of Section 359(6) of the Companies & Allied Matters Act CAP C20 Laws of the Federation of Nigeria 2004, we members of the Audit Committee hereby report as follows:

• That the scope and planning of the audit were adequate in our opinion;• That the accounting and reporting policies of the Company conformed with statutory requirements

and ethical practices;• That the internal control was being constantly and efficiently monitored;• That the Joint External Auditors’ management report received satisfactory response from Management.•

Dated March 23, 2016

KAYODE ABAYOMIChairman, Audit Committee

Members of the CommitteeMr. Kayode Abayomi - ChairmanMr Olufunso Soyoye - Non Executive Director

REPORT OF THE AUDIT COMMITTEEFOR THE YEAR ENDED 30 JUNE 2014


Report on the consolidated financial statementsWe have audited the accompanying consolidated financial statements of Swap Technologies and Telecomms Plc and its subsidiaries, which comprise the consolidated statement of financial position as at 30 June 2014, the consolidated statement of comprehensive income, consolidated statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Directors’ responsibility for the financial statementsThe Company’s directors are responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the relevant standards issued by the Financial Reporting Council of Nigeria and the provisions of the Companies and Allied Matters Act, CAP C20 Laws of the Federation of Nigeria 2004 and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatements, whether due to fraud or error.

Auditors’ responsibilityOur responsibility is to express an opinion on these financial statements based on conducting the audit in accordance with International Standards on Auditing. Because of the matter described in the Basis for Disclaimer of Opinion paragraph, however, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the financial statements give a true and fair view of the financial position of SWAP Technologies and Telecomms Plc as at 30 June 2014 and its financial performance and its cash flows for the year then ended in accordance with the International Financial Reporting Standards, provisions of the Companies and Allied Matters Act, CAP C20 Laws of the Federation of Nigeria 2004 and in compliance with the Financial Reporting Council of Nigeria Act, No 6 2011.

Emphasis of MatterWithout qualifying our opinion, we draw attention to note 41 to the financial statements which indicates that the Company made a net loss of N5.34 billion (2013: N6.73 billion) and at balance sheet date, the current liabilities exceeded its current assets by N15.30billion (2013: N6.85billion) and a deficit in shareholders’ funds of N13.77billion (2013: N8.44billion). These conditions, along with other matters indicate the existence of a material uncertainty which may cast significant doubt on the Company’s ability to continue as a going concern.

INDEPENDENT AUDITORS’ REPORTTO THE MEMBERS OF SWAP TECHNOLOGIES AND TELECOMMS PLC

Ernst & YoungUBA Building10th & 13th Floor57, Marina Lagos, Nigeria.

Tel: +234 (01) 463 0479 / 80Fax: +234 (01) 463 0481ey.com

NACCIMA HOUSE8A, Oba Akinjobi Road, GRA, Ikeja.P. O. Box 9131, Ikeja, Lagos.Tel: 08023125682, 07051438246E-mail: [email protected]@yahoo.com [email protected]: www.yinkaadesanya.com


Report on Other Legal and Regulatory RequirementsIn accordance with the requirement of Schedule 6 of the Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004, we confirm that:

i) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

ii) in our opinion, proper books of account have been kept by the Company and its subsidiaries, so far as appears from our examination of those books, and proper returns adequate for the purposes of our audit have been received from branches not visited by us;

iii) the Group’s consolidated statement of financial position and consolidated statement of comprehensive income are in agreement with the books of account;

Funmi Ogunlowo, Adeyinka Adesanya FCA, FRC/2013/ICAN/00000000681 FCA, FRC/2013/ICAN/000001215

For: Ernst & Young Chartered Accountants For: Yinka Adesanya & Co Lagos, Nigeria Lagos, Nigeria May 24, 2016 May 24, 2016

INDEPENDENT AUDITORS’ REPORTTO THE MEMBERS OF SWAP TECHNOLOGIES AND TELECOMMS PLC

Ernst & YoungUBA Building10th & 13th Floor57, Marina Lagos, Nigeria.

Tel: +234 (01) 463 0479 / 80Fax: +234 (01) 463 0481ey.com

NACCIMA HOUSE8A, Oba Akinjobi Road, GRA, Ikeja.P. O. Box 9131, Ikeja, Lagos.Tel: 08023125682, 07051438246E-mail: [email protected]@yahoo.com [email protected]: www.yinkaadesanya.com


Group CompanyNotes 2014 2013 2014 2013

N’000 N’000 N’000 N’000

Revenue 6 3,450,538 5,319,146 2,936,066 4,340,917Cost of sales 7 (3,059,604) (3,922,477) (2,865,793) (3,158,810)

Gross Profit 390,934 1,396,669 70,273 1,182,107Other operating income 8 78,145 74,665 64,319 71,032Employee benefit expenses 9 (253,112) (305,825) (94,751) (122,318)Depreciation & amortisation 10 (1,727,716) (1,903,398) (1,693,185) (1,878,271)Other operating expenses 11 (1,039,686) (3,459,805) (676,797) (3,278,513)

Operating Profit (2,551,435) (4,197,694) (2,330,141) (4,025,963)Finance income 12 11,538 15,332 8,034 10,543Finance cost 13 (3,067,571) (2,709,525) (3,005,756) (2,698,141)

Loss before income tax (5,607,468) (6,891,887) (5,327,863) (6,713,561)Income tax expense 14.1 11,660 5,503 (7,068) (11,336)

Loss after taxation (5,595,808) (6,886,384) (5,334,931) (6,724,897)

Other comprehensive income Other comprehensive income not to be reclassified to profit or loss in subsequent periods (net of tax):

Remeasurement gains 31 4,208 233 (831) (5681)Other comprehensive income to be reclassified to profit or loss in subsequent periods :Exchange differences on translation of foreign operations (936) (5,562) - -

Total comprehensive income for theyear, net of tax (5,592,536) (6,891,713) (5,335,762) (6,730,578)

Basic and Diluted Earnings per share (kobo) 35 (207) (255) (197) (249)

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2014


Group CompanyNotes 30-Jun-14 30-Jun-13 1-Jul-12 30-Jun-14 30-Jun-13 1-Jul-12

N 000 N 000 N 000 N 000 N 000 N 000Non-current assetsProperty, plant and equipment 15 11,972,043 13,321,732 13,997,057 11,908,421 13,243,063 13,951,104Investment properties 16 400,000 360,000 368,500 400,000 360,000 368,500Deferred tax assets 14.3 55,915 30,525 - - - -Intangible assets 17 6,510 10,622 14,734 6,510 10,622 14,734Investment in Subsidiaries 18a - - - 484,707 484,707 93,363Prepayments 19 1,023,655 1,279,568 103,956 1,023,655 1,279,568 103,956Available for sale investment 20 184,600 223,900 371,500 184,600 223,900 371,500Loan receivables 21 155,187 348,835 345,958 217,605 408,376 408,376

13,797,910 15,575,182 15,201,705 14,225,498 16,010,236 15,311,533

Current assetsInventories 22 264,331 384,030 718,687 152,030 260,176 699,190Trade and other receivables 21b 1,687,655 2,036,378 3,424,061 1,430,208 1,691,789 3,434,334Held to maturity 23 12,528 19,545 20,887 - - -Other current assets 24 640,758 720,474 673,749 574,106 618,314 601,738Cash and short-term deposits 25 65,504 859,076 57,271 53,641 734,759 18,861

2,670,776 4,019,503 4,894,655 2,209,985 3,305,038 4,754,123

Total assets 16,468,686 19,594,685 20,096,360 16,435,483 19,315,274 20,065,656

Equity and liabilitiesEquity Issued capital 26.1 1,352,689 1,352,689 1,352,689 1,352,689 1,352,689 1,352,689Share premium 26.2 2,953,228 2,953,228 2,953,228 2,953,228 2,953,228 2,953,228Retained earnings (18,648,255) (13,056,655) (6,170,504) (18,054,014) (12,718,252) (5,987,675)Foreign currencytranslation reserve (6,498) (5,562) -

Total equity (14, 348,836) (8,756,300) (1,864,587) (13,748,097) (8,412,335) (1,681,758)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2014


Group CompanyNotes 30-Jun-14 30-Jun-13 1-Jul-12 30-Jun-14 30-Jun-13 1-Jul-12

N 000 N 000 N 000 N 000 N 000 N 000Finance lease liabilities 30 4,422 - 15,429 4,422 - 15,429Employee benefit liability 31 46,131 44,397 17,549 20,497 18,903 16,595Decommissioning liabilities 32 134,318 119,516 105,977 134,318 119,516 105,977Deferred tax liabilities 14.4 11,268 2,609 74 - - -

12,711,057 17,604,014 14,306,017 12,674,155 17,575,911 14,304,990

Current liabilitiesTrade and other payables 33 6,272,926 3,703,016 4,170,093 5,876,786 3,385,296 3,964,405Interest-bearing loans and borrowings 27b 11,793,487 7,028,461 3,453,590 11,594,064 6,746,609 3,453,592Finance lease liabilities 30 20,251 8,537 7,777 20,251 8,537 7,777Income tax payable 14.6 19,801 6,957 23,470 18,324 11,256 16,650

18,106,465 10,746,971 7,654,930 17,509,425 10,151,698 7,442,424

Total liabilities 30,817,522 28,350,985 21,960,947 30,183,580 27,727,609 21,747,414

Total equity and liabilities 16,468,686 19,594,685 20,096,360 16,435,483 19,315,274 20,065,656

CONSOLIDATED STATEMENT OF FINANCIAL POSITION - contdAS AT 30 JUNE 2014

Approved by the Board of Directors on March 23, 2016 and signed on its behalf by:

Chief Executive Officer Director Chief Financial OfficerFRC/2014/IODN/9522 FRC/2013/IODN/2684 FRC/2013/ICAN/2641

The accompanying notes on pages 16 to 68 are an integral part of these consolidated financial statements.


Group

Issued Share Capital

Share premium

Foreign currency

translation reserve

Retained Earnings Total Equity

₦000 ₦000 ₦000 ₦000 ₦000

As at 1 July 2013 1,352,689 2,953,228 (5,562) (13,056,655) (8,756,300)Loss for the year (5,595,808) (5,595,808)Other comprehensive income (936) 4,208 3,272

At 30 June 2014 1,352,689 2,953,228 (6,498) (18,648,255) (14,348,836)

As at 1 July 2012 1,352,689 2,953,228 - (6,170,504) (1,864,587)Loss for the year (6,886,384) (6,886,384)Other comprehensive income (5,562) 233 (5,329)

At 30 June 2013 1,352,689 2,953,228 (5,562) (13,056,655) (8,756,300)

Company

Issued Share Capital

Share premium

Foreign currency

translation reserve

Retained Earnings Total Equity

₦000 ₦000 ₦000 ₦000 ₦000

As at 1 July 2013 1,352,689 2,953,228 - (12,718,252) (8,412,335)Loss for the year (5,334,931) (5,334,931)Other comprehensive income - (831) (831)

At 30 June 2014 1,352,689 2,953,228 (18,054,014) (13,748,097)

As at 1 July 2012 1,352,689 2,953,228 - (5,987,675) (1,681,758)Loss for the year (6,724,896) (6,724,896)Other comprehensive income - (5,681) (5,681)

At 30 June 2013 1,352,689 2,953,228 - (12,718,252) (8,412,335)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2014


Group CompanyNotes 2014 2013 2014 2013

₦000 ₦000 ₦000 ₦000Operating activities Loss before tax (5,607,468) (6,891,887) (5,327,863) (6,713,561)Adjustments to reconcile loss before tax to net cash flows:

Depreciation & amortization 10 1,727,716 1,903,398 1,693,185 1,878,271Net benefit expense 31 14,668 15,232 7,040 6,359Finance income 12 (11,538) (15,332) (8,034) (10,543)Fair value adjustment of investment properties 16 (40,000) 8,500 40,000 (8,500)

Amortisation of employee loan 1,346 167 1,346 167Impairment of available for sale 20 (39,300) (147,500) (39,300) (147,500)Inventory write off 19,225 19,225Movement in provisions 14,802 13,539 14,802 12,877Finance cost 13 3,013,469 2,549,048 2,951,654 2,537,664Loss on disposal of property, plant & Equipment 30,997 18,555 30,997 18,555

Net foreign exchange differences 8 (11,102) (66,566)

Working capital adjustments: Decrease in inventories 119,699 334,657 108,146 439,014Decrease in trade and other receivables 348,724 1,529,113 326,616 1,947,447Decrease/ (increase) in other current assets 79,715 (46,724) 44,207 (16,575)Increase/ (Decrease) in trade and other payables 2,569,910 (467,077) 2,491,489 (579,110)

Employee benefit paid 31 (6,276) (9,732) (6,276) (9,732)Income tax paid 14.6 4,517 (41,713) - (16,730)

Net cash flows from/(used in) operating activities 2,209,879 (1,294,886) 2,328,009 (642,672)

Cashflows from investing activitiesPurchase of PPE 15 (627,485) (1,373,047) (601,634) (635,574)Proceed from sale of PPE 221,812 11,616 216,206 10,491Proceeds from sale of financial instruments 7,019 1,342Interest received 12 11,538 15,332 7,261 9,067Increase in investment - - - (243,744)

Net cash utilized by investing activities (387,116) (1,344,757) (378,167) (859,760)

CONSOLIDATED STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 30 JUNE 2014


Group CompanyNotes 2014 2013 2014 2013 ₦000 ₦000 ₦000 ₦000

Financing activitiesInterest & similar charges on loans 13 (2,959,361) (3,097,551) (2,951,654) (3,097,551)Loan received 834,510 7,241,294 376,870 6,197,345Loan repayment (585,450) (320,129) (72,311) (340,000)Finance lease received 36,365 - 36,365 -Finance lease payment (20,230) (14,669) (20,230) (14,669)

Net cash flows (used in) /from financing activities (2,694,166) 3,808,945 (2,630,969) 2,745,125

Net (decrease)/increase in cash and cash equivalents (871,404) 1,169,302 (681,128) 1,242,692Net foreign exchange difference (102,621) 159,297 - -Cash and cash equivalents at 1 July 859,076 (469,523) 734,759 (507,933)

Cash and cash equivalents at 30 June 25 (114,949) 859,076 53,641 734,759

CONSOLIDATED STATEMENT OF CASH FLOWS - ContinuedFOR THE YEAR ENDED 30 JUNE 2014


1 Corporate information The consolidated financial statements of Swap Technologies and Telecomms Plc and its subsidiaries

(collectively, the Group) for the year ended 30 June 2014 were authorised for issue in accordance with a resolution of the directors on 23 March 2016. Swap Technologies and Telecomms Plc (the Group or the parent) is a Public limited liability Group incorporated and domiciled in Nigeria. The registered office is located at Remi Olowude Way,Lekki Phase 1, Lagos. The Group is principally engaged in the provision of infrastructure sharing (co-location) services, turnkey site deployment and cell site management services to the telecoms industry. Information on the Group’s structure and other related party relationships of the Group is provided in Note 34.

2.1 Basis of preparation The Group previously prepared its consolidated financial statements in accordance with Nigerian generally

accepted accounting principles as defined by the Statement of Accounting Standards in Nigeria. In 2010, the Financial Reporting Council of Nigeria (FRCN) announced the roadmap for the adoption of International Financial Reporting Standard (IFRS); this requires other significant public interest entities (companies that are not publicly trading their shares) to effectively adopt IFRS in the year beginning 1 July 2012. Accordingly, the Group adopted IFRS and will produce its first annual financial statements for the year ended 30 June 2014. These are the group’s first annual consolidated financial statements prepared in accordance with IFRS as issued by the International Accounting Standards Board (IASB). The consolidated financial statements have been prepared on a going concern basis.The consolidated financial statements have been prepared on a historical cost basis, except for land and buildings classified as property, plant and equipment that have been measured at fair value. In these consolidated financial statements, the term “Nigerian GAAP” refers to Nigerian GAAP before the adoption of IFRS.

The consolidated financial statements of Swap Technologies and Telecomms Plc and all of its subsidiaries (the “Group”) have been prepared in compliance with IFRS. Subject to certain transition elections and exceptions disclosed in the transition note, the Group has consistently applied the accounting policies used in the preparation of its opening IFRS statement of financial position at 1 July, 2012 throughout all periods presented, as if these policies had always been in effect.

The transition note discloses the impact of the transition to IFRS on the Group’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in the Group’s consolidated financial statements for the year ended 30 June, 2013 prepared under Nigerian GAAP.

The consolidated financial statements were authorized by the Board of Directors on March 23 2016.

The consolidated financial statements are presented in Naira and all values are rounded to the nearest thousand , except when otherwise indicated.

2.2 Basis of consolidation “The consolidated financial statements comprise the financial statements of the Group and its subsidiaries as

at 30 June 2014. Subsidiaries are fully consolidated from the date of incorporation of Swap Technologies and Telecomms Plc, being the date on which the Group obtains control, and continue to be consolidated until the date when such control ceases.

The financial statements of the subsidiaries are prepared for the same reporting period as the parent Group, using consistent accounting policies. All intra-group balances, transactions and unrealised gains and losses resulting from intra-group transactions and dividends are eliminated in full.

Where the ownership of a subsidiary is less than 100%, and therefore a non-controlling interest exists, the non controlling interest are allocated their share of the total comprehensive income of the period, even if that results in a deficit balance.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it:

• Derecognises the assets and liabilities of the subsidiary• Derecognises the cumulative translation differences, recorded in equity

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS


• Recognises the fair value of the consideration received • Recognises the fair value of any investment retained • Recognises any surplus or deficit in profit or loss.• Reclassifies the parent’s share of components previously recognised in other comprehensive income to

profit or loss or retained earnings, as appropriate.

2.3 Summary of significant accounting policies The following are the significant accounting policies applied by the Group in preparing its consolidated

financial statements:

2.3.1 Foreign currencies The Group’s consolidated financial statements are presented in Naira which is also the parent company’s

functional currency. For each entity, the Group determines the functional currency and items included in the financial statements of each entity are measured using that functional currency. The Group uses the direct method of consolidation and has elected to recycle the gain or loss that arises from this method.

Transactions and balances “Transactions in foreign currencies are initially recorded by the Group entities at their respective functional

currency spot rate at the date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency spot rate of exchange ruling at the reporting date.

Differences arising on settlement or translation of monetary items are recognised in profit or loss

“Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of gain or loss on change in fair value in the item (i.e. the translation differences on items whose fair value gain or loss is recognised in OCI or profit or loss are also recognised in OCI or profit or loss, respectively).

Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition are treated as assets and liabilities of the foreign operation and translated at the spot rate of exchange at the reporting date”

Group companies On consolidation, the assets and liabilities of foreign operations are translated into Naira at the rate of

exchange prevailing at the reporting date and their statements of profit or loss are translated at exchange rates prevailing at the dates of the transactions.

The exchange differences arising on the translation are recognised in other comprehensive income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognised in profit or loss.”

2.3.2 Current versus non-current classification The Group presents assets and liabilities in statement of financial position based on current/non-current

classification. An asset is current when it is:

i. Expected to be realised or intended to be sold or consumed in a normal operating cycleii. Held primarily for the purpose of tradingiii. Expected to be realised within twelve months after the reporting period, oriv. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least

twelve months after the reporting period



All other assets are classified as non-current liability when:i. It is expected to be settled in normal operating cycleii. It is held primarily for the purpose of tradingiii. It is due to be settled within twelve months after the reporting period, oriv. There is no unconditional right to defer the settlement of the liability for at least twelve months after

the reporting date

The Group classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

2.3.3 Fair value measurement The Group measures financial instruments, such as, available-for-sale financial instruments and non-financial

assets such as investment properties, at fair value at the end of each reporting period. Also, fair values of financial instruments (loans and receivables) measured at amortised cost using the effective interest rate method are disclosed in Note 28

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

i. In the principal market for the asset or liability, orii. In the absence of a principal market, in the most advantageous market for the asset or liability.

The principal or the most advantageous market must be accessible to by the Group.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that the market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fairvalue measurement as a whole:

Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

External valuers are involved for valuation of significant assets, such as properties, and significant liabilities, such as contingent consideration. Involvement of external valuers is decided upon annually by management. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained.



For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

2.3.4 Revenue recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and

the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The Group has concluded that it is the principal in all of its revenue arrangements since it is the primary obligor in all the revenue arrangements, has pricing latitude and is also exposed to inventory and credit risks.

The specific recognition criteria described below must also be met before revenue is recognized.

Sale of telecommunication support services The group provides services in respect of mobile and wired telecommunication infrastructure sharing,

colocation and providing managed services. For sale of managed services and sharing and leasing services, revenue is recognised in the accounting period in which the services are rendered by reference to the stage of completion based on the terms of each contract.

Revenue from construction contracts The group also engages in constructing towers and other related equipment for some of its customers.

Revenue corresponds to the initial amount of revenue agreed in the contract and any variations in contract work, claims and incentive payments to the extent that it is probable that they will result in revenue, and they can be reliably measured. Contract revenue is measured at the fair value of the consideration received or receivable. The group recognises revenue based on the percentage of completion method. The percentage of completion is determined by reference to the proportion of cost incurred to date as against the estimated total cost of the contract.

Interest Income For all financial instruments measured at amortised cost and interest-bearing financial assets classified as

available-for-sale, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset or liability. Interest income is included in finance income in profit or loss.

Dividends Revenue is recognised when the Group’s right to receive the payment is established, which is generally when

shareholders approve the dividend.

Rental income Rental income arising from operating leases on investment properties is accounted for on a straight-line

basis over the lease terms and is included in other income in profit or loss due to its operating nature.

2.3.5 Taxes Current income tax Current income tax assets and liabilities for the current period are measured at the amount expected to be

recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries where the Group operates and generates taxable income.

An explanation of the relationship between tax expense (income) and accounting profit is provided using a numerical reconciliation between tax expense (income) and the product of accounting profit multiplied by the applicable tax rate(s). Income taxes expenses is the aggregate of the charge to the profit and loss account in respect of income tax, education tax and deferred tax. Education tax is computed at 2% of assessable profit.



Current income tax relating to items recognised directly in equity is recognised in equity and not in profit or loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred tax “Deferred tax is provided using the liability method on temporary differences between the tax bases of assets

and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, excepti. When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in

a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

ii. In respect of taxable temporary differences associated with investments in subsidiaries, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.”

“Deferred tax assets are recognised for all deductible temporary differences, they carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except

i. When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

ii. In respect of deductible temporary differences associated with investments in subsidiaries, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

iii. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, are recognised subsequently if new information about facts and circumstances change. The adjustment is either treated as a reduction in goodwill (as long as it does not exceed goodwill) if it was incurred during the measurement period or recognised in profit or loss.

Value added tax Expenses and assets are recognised net of the amount of value added tax, except:

• When the value added tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the value added tax is recognised as part of the cost of acquisition of the asset or as part of the expense item, as applicable

• When receivables and payables are stated with the amount of value added tax included• The net amount of value added tax recoverable from, or payable to, the taxation authority is included

as part of receivables or payables in the statement of financial position.



2.3.6 Property, plant and equipment Property, plant and equipment (PPE) is stated at cost, net of accumulated depreciation and accumulated

impairment losses, if any. The initial cost of PPE comprises its purchase price and any costs directly attributable to bringing the asset into operation, the initial estimate of any decommissioning obligation, if any, and, for qualifying assets. Such cost also includes the cost of replacing component parts of the property, plant and equipment and borrowing costs for long-term construction projects if the recognition criteria are met. The purchase price is the aggregate amount paid and the fair value of any other consideration given to acquire the asset. When significant parts of property, plant and equipment are required to be replaced at intervals, the Group de-recognises the replaced part, and recognises the new part with its own associated useful life and depreciation. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of plant and equipment as a replacement if the general recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred.

The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met. Refer to significant accounting judgments, estimates and assumptions (Note 4) and provisions (Note 32) for further information about the recorded decommissioning provision.

Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets as follows:

% Buildings 2 Plant and machinery 25 Motor vehicles 25 Furniture and Fittings 25 Office/Site equipment 20 Towers 6.67 Generators and cooling systems 33 Back Up Power 50 Fence and Transformers 10 Leasehold towers 25

“An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss when the asset is derecognised.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

2.3.7 Leases The determination of whether an arrangement is (or contains) a lease is based on the substance of the

arrangement at the inception date. The arrangement is assessed for whether fulfilment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

For arrangements entered into prior to 1 July 2012, the date of inception is deemed to be 1 July 2012 in accordance with IFRS 1 First-time Adoption of International Reporting Standards.

Group as a lessor Leases in which the Group does not transfer substantially all the risks and benefits of ownership of the asset

are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same bases as rental income.

Contingent rents are recognised as other income in the period in which they are earned.



Group as a lessee Finance leases that transfer to the Group substantially the entire risks and benefits incidental to ownership

of the leased item, are capitalised at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in finance costs in profit or loss.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Operating lease payments are recognized as the operating expense in profit or loss on a straight line basis over the lease term.”

2.3.8 Borrowing costs “Borrowing costs directly attributable to the acquisition, construction or production of an asset that

necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the respective asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

Borrowing costs incurred on or after the date of transition (1 July 2012) for all eligible qualifying assets are capitalised. Borrowing costs are recognised in profit or loss. The Group has not capitalized any qualifying borrowing cost during the year ended 30 June 2014.

2.3.9 Investment properties “Investment properties are measured initially at cost, including transaction costs. Subsequent to initial

recognition, investment properties are stated at fair value, which reflects market conditions at the reporting date. Gains or losses arising from changes in the fair values of investment properties are included in profit or loss in the period in which they arise, including the corresponding tax effect. Fair values are determined based on an annual evaluation performed by an accredited external independent valuer by applying a valuation model recommended by the International Valuation Standards Committee.

Investment properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition. Transfers are made to (or from) investment property only when there is a change in use. For a transfer from investment property to owner-occupied property, the deemed cost for subsequent accounting is the fair value at the date of change in use. If owner-occupied property becomes an investment property, the Group accounts for such property in accordance with the policy stated under property, plant and equipment up to the date of change in use.

2.3.10 Intangible assets “Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible

assets acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses.

Internally generated intangibles, excluding capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred.

The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period.

Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are



treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in profit or loss as part of administrative expense. Intangible assets with indefinite useful lives are not amortised, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.

Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is derecognised.

Research and development costs Research costs are expensed as incurred. Development expenditures on an individual project are recognized

as an intangible asset when the Group can demonstrate:

i. The technical feasibility of completing the intangible asset so that the asset will be available for use or sale

ii. Its intention to complete and its ability to use or sell the assetiii. How the asset will generate future economic benefitsiv. The availability of resources to complete the assetv. The ability to measure reliably the expenditure during developmentvi. The ability to use the intangible asset generated

Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised over the period of expected future benefit. During the period of development, the asset is tested for impairment annually.

2.3.11 Financial instruments – initial recognition and subsequent measurement A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or

equity instrument of another entity.

Financial assets Initial recognition All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair

value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. The financial assets of the Group are classified, at initial recognition, as loans and receivables and available-for-sale financial assets. The classification depends on the purpose for which the financial assets were acquired. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the settlement date, i.e., the date that the Group made payment for the purchase or sale of the asset.

Subsequent measurement The subsequent measurement of financial assets depends on their classification as follows:

Loans and receivables This category is the most relevant to the Group. Loans and receivables are non-derivative financial assets

with fixed or determinable payments that are not quoted in an active market. After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method, less impairment. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in profit or loss. The losses arising from impairment are recognised in profit or loss in other operating expenses. This category applies to due from related parties, staff loans, cash and bank and trade and other receivables.

Available-for-sale (AFS) financial investments AFS financial investments include equity investments. Equity investments classified as AFS are those that are

neither classified as held for trading nor designated at fair value through profit or loss.



After initial measurement, AFS financial investments are subsequently measured at fair value with unrealised gains or losses recognised in Other comprehensive income credited in the AFS reserve until the investment is derecognised, at which time the cumulative gain or loss is recognised in other operating income, or the investment is determined to be impaired, when the cumulative loss is reclassified from the AFS reserve to profit or loss in finance costs.

For presentation purposes the Group presents available-for-sale financial investments as a lump sum on the face of the financial statement with the analysis into different categories shown in the notes.

Derecognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets)

is primarily derecognised (i.e. removed from the group’s consolidated statement of financial position) when:

i. The rights to receive cash flows from the asset have expired, or ii. The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation

to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset

When the Group has tran sferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.

Impairment of financial assets The Group assesses, at each reporting date, whether there is objective evidence that a financial asset or a

group of financial assets is impaired. An impairment exists if one or more events that has occurred since the initial recognition of the asset (an incurred ‘loss event’), has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial re-organisation and observable data indicating that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

Financial assets carried at amortised cost For financial assets carried at amortised cost, the Group first assesses whether impairment exists individually

for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Group determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be, recognised are not included in a collective assessment of impairment.

The amount of any impairment loss identified is measured as the difference between the assets’s carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not yet been incurred). The present value of the estimated future cash flows is discounted at the financial asset’s original effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account and the loss is recognized in profit or loss. Interest income (recorded as finance income in profit or loss) continues to be accrued on the reduced carrying amount and is accrued using the rate of interest used to discount the future



cash flows for the purpose of measuring the impairment loss. Loans together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realised or has been transferred to the Group. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or reduced by adjusting the allowance account. If a write-off is later recovered, the recovery is credited to finance costs in profit or loss.”

Available-for-sale (AFS) financial assets “For AFS financial investments, the Group assesses at each reporting date whether there is objective evidence

that an investment or a group of investments is impaired.

In the case of equity investments classified as AFS, objective evidence would include a significant or prolonged decline in the fair value of the investment below its cost. ‘Significant’ is evaluated against the original cost of the investment and ‘prolonged’ against the period in which the fair value has been below its original cost. When there is evidence of impairment, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that investment previously recognised in profit or loss – is removed from OCI and recognised in profit or loss. Impairment losses on equity investments are not reversed through profit or loss; increases in their fair value after impairment are recognised in OCI.

Financial liabilities Initial recognition All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and

payables, net of directly attributable transaction costs. The financial liabilities of the Group are mainly classified, at initial recognition, as other financial liabilities which include trade and other payables and loans and borrowings.

Subsequent measurement The measurement of financial liabilities depends on their classification, as described below: Other financial liabilities “This is the category most relevant to the Group and they include interest-bearing loans and borrowings

and trade and other payables. After initial recognition, the financial liabilities are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in profit or loss.

The Group classifies its financial liabilities as current liabilities if payment is due within one year (or trade payable in the normal operating cycle of the business, if longer). If not, they are presented as non-current liabilities.

De-recognition “A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or

expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in profit or loss.”

Offsetting of financial instruments Financial assets and financial liabilities are offset and the net amount is reported in the consolidated

statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously



2.3.12 Inventories Inventories are valued at the lower of cost and net realisable value. Costs incurred in bringing each product

to its present location and conditions are accounted for as follows:

i. Raw materials: purchase cost ii. Finished goods and work in progress: cost of direct materials and labour and a proportion of

manufacturing overheads based on the normal operating capacity, but excluding borrowing costs.

The Group uses weighted average cost formula for its entire inventory. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

2.3.13 Impairment of non-financial assets “The Group assesses, at each reporting date, whether there is an indication that an asset may be impaired.

If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount.

An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.

For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Group estimates the asset’s or CGU’s recoverable amount.

A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognized in profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.”

2.3.14 Cash and Short term deposits Cash and short-term deposits in the statement of financial position comprise cash at banks and on hand and

short-term deposits with a maturity of three months or less.

For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts.

2.3.15 Provisions, contingent liabilities and contingent assets General Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past

event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

When the Group expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognized as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in profit or loss net of any reimbursement.



If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. Provisions are not recognised for future operating losses. The Group discloses contingent liability where it is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. The Group also discloses contingent asset where it is a probable asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events. Contingent assets are recognised when they are virtually certain.

Decommissioning liability The Group records a provision for the cost of decommissioning and dismantling its telecommunication

towers on the leasehold land. The decommissioning may be done at the expiration of the lease agreements, the useful life of the towers, or based on management discretion. The provision is based on management’s best estimate of the cost of decommissioning and restoring the site, escalated at the relevant discount rate, average probability and inflation factor/ The Group estimates this provision using the current prices of existing technology as quoted by decommissioning experts, escalated at the relevant inflation factor. The cash flows are discounted at a current pre-tax rate that reflects the risks specific to the decommissioning liability/the group’s current borrowing cost. Upon initial recognition, the associated asset retirement costs are capitalized as part of the cost of the towers in property, plant and equipment and a corresponding asset retirement and restoration liability is also recognised. The asset is depreciated in line with the depreciation policy of the relevant asset.

The unwinding of the discount is expensed as incurred and recognised in profit or loss as a finance cost. The estimated future costs of decommissioning are reviewed annually and adjusted as appropriate. Changes in the estimated future costs or in the discount rate applied are added to or deducted from the cost of the asset.

2.3.16 Pensions and other post-employment benefits Defined Contribution Plans In line with the provisions of the Pension Reform Act 2004, the Company operates a defined contributory

staff pension scheme for all its employees. The Company and each employee contribute 7.5% of the employees’ annual insurable earnings (basic pay, transport and housing) to the scheme. Staff contributions to the scheme are funded through payroll deductions while the Company’s contributions are charged to profit and loss as administrative expense.

Defined benefit Plans The Company also operates an unfunded defined benefit plan, i.e. terminal gratuity scheme, which is based

on the number of years of services of the retiring personnel. The cost of providing benefits under the scheme is determined using the projected unit credit method.

Re-measurements, comprising of actuarial gains and losses and the return on plan assets (excluding net interest), are recognized immediately in the statement of financial position with a corresponding debit or credit to retained earnings through OCI in the period in which they occur. Re-measurements are not reclassified to profit or loss in subsequent periods.

Past service costs are recognised in profit or loss on the earlier of:

i. The date of the plan amendment or curtailment, and ii. The date that the Company recognises restructuring-related costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The

Company recognises the following changes in the net defined benefit obligation under ‘administrative expenses’ in consolidated statement of profit or loss:



i. Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-routine settlements.

ii. Net interest expense or income.

The group has no termination benefit plan for its employees.

2.3.17 Dividend distribution The Group recognises a liability to make cash distributions to equity holders of the parent when the

distribution is authorised and the distribution is no longer at the discretion of the Company. A distribution is authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.

3 First time adoption These consolidated financial statements, for the year ended 31 December 2014, are the first the Group

has prepared in accordance with IFRS. For periods up to and including the year ended 30 June 2013, the Group prepared its consolidated financial statements in accordance with the Nigerian generally accepted accounting principle (N GAAP). Accordingly, the Group has prepared consolidated financial statements which comply with IFRS applicable for periods ending on or after 30 June 2014, together with the comparative period data as at and for the year ended 30 June 2013, as described in the summary of significant accounting policies. In preparing these consolidated financial statements, the Group’s opening statement of financial position was prepared as at 1 July 2012, the Group’s date of transition to IFRS. This note explains the principal adjustments made by the Group in restating its N GAAP consolidated financial statements, including the statement of financial position as at 1 July 2012 and the consolidated financial statements as at and for the year ended 30 June 2013.

Exemptions applied IFRS 1 allows first-time adopters certain exemptions from the retrospective application of certain

requirements under IFRS. The Group has applied the following exemptions:

a. The Group has elected to disclose the present value of the defined benefit obligation prospectively from the date of transition.

b. The Group has applied the transitional provision in IFRIC 4 Determining whether an Arrangement Contains a Lease and has assessed all arrangements based upon the conditions in place as at the date of transition.

c. The Group has applied the transitional provisions in IAS 23 Borrowing Costs and capitalises borrowing costs relating to all qualifying assets after the date of transition. Similarly, the Group has not restated for borrowing costs capitalised under Nigerian GAAP on qualifying assets prior to the date of transition to IFRS.

d. The Group has designated unquoted equity instruments held at 1 January 2014 as AFS financial assets.

Estimates The estimates at 1 July 2012 and at 30 June 2013 are consistent with those made for the same dates in

accordance with Nigerian GAAP (after adjustments to reflect any differences in accounting policies) apart from following items where application of the N GAAP did not require estimation.

a. Defined benefit obligations (Gratuity)b. AFS financial assets – unquoted equity sharesc. Decommisioning liabilities

The estimates used by the Group to present these amounts in accordance with IFRS reflect conditions at 1 July 2012, the date of transition to IFRS and as at 30 June 2013.



Group’s Reconciliation of equity as at 1 July 2012Nigerian

GAAPRe-

classificationsRe-

measurements IFRSNotes ₦000 ₦000 ₦000 ₦000

AssetsNon-current assetsProperty, plant and equipment A,B 13,983,902 (14,775) 27,930 13,997,057Investments C 833,251 (833,251) -Investment property C - 461,751 (93,251) 368,500Intangible assets A - 14,775 (41) 14,734Investment in subsidiary A - - - -Prepayments D - 103,956 - 103,956Available for sale investment C - 371,500 - 371,500Deferred tax assets E 2,724,575 (2,724,575) - -Other long term assets D 380,958 (380,958) - -Loan receivables F - 345,958 - 345,958

17,922,686 (2,655,619) (65,362) 15,201,705

Current assetsInventories A 748,740 (30,053) - 718,687Trade and other receivables D 4,143,551 (652,874) (66,616) 3,424,061Held to maturity D - - 20,887 20,887Other current assets D - 673,749 - 673,749Cash and short-term deposits 57,271 - 57,271

4,949,562 (9,178) (45,729) 4,894,655

Total assets 22,872,248 (2,664,797) (111,091) 20,096,360

Equity and liabilitiesEquityIssued capital 1,352,689 1,352,689Share premium 2,953,228 2,953,228Capital reserve G 160,820 (160,820) -Retained earnings (6,215,748) 204,434 (159,190) (6,170,504)Foreign currency translation reserve G 43,614 (43,614) -

Total equity (1,705,397) - (159,190) (1,864,587)



Nigerian GAAP

Re-classifications

Re-measurements IFRS

Notes ₦000 ₦000 ₦000 ₦000Non-current liabilitiesInterest-bearing loans and borrowings 14,166,988 14,166,988Finance lease liabilities 15,429 15,429Employee defined benefit liability H 37,681 (20,133) 17,549Decommissioning liabilities B 37,745 68,232 105,977Deferred tax liabilities E 2,724,575 (2,724,501) 74

16,982,418 (2,724,501) 48,099 14,306,016



Group’s Reconciliation of equity as at 1 July 2012 (Cont’d)

Nigerian GAAP

Re-classifications


Notes ₦000 ₦000 ₦000 ₦000Current liabilitiesCreditors and accruals 4,117,208 (4,117,208) -Trade and other payables - 4,170,093 4,170,093Bank overdraft 526,794 (526,794) -Interest-bearing loans and borrowings I 2,926,798 526,794 3,453,592Due to related parties - -Finance lease liabilities J 7,777 7,777Income tax payable 16,650 6,820 23,470

7,595,227 59,705 - 7,654,932

Total liabilities 24,577,645 (2,664,796) 48,009 21,960,947

Total equity and liabilities 22,872,248 (2,664,796) (111,091) 20,096,360

Company’s Reconciliation of equity as at 1 July 2012

Nigerian GAAP

Re-classifications


Notes ₦000 ₦000 ₦000 ₦000AssetsNon-current assetsProperty, plant and equipment A,B 13,927,964 3,895 19,245 13,951,104Investments C 926,614 (926,614) -Investment property C - 461,751 (93,251) 368,500Intangible assets D - 14,775 (41) 14,734Investment in subsidiary - 93,363 93,363Prepayments 103,956 103,956Available for sale investment - 371,500 371,500Deferred tax assets 2,724,575 (2,724,575) -Other long term assets 380,958 (380,958) -Loan receivables 62,418 345,958 408,376

18,022,529 (2,636,949) (74,047) 15,311,533



Company’s Reconciliation of equity as at 1 July 2012Nigerian

GAAPRe-

classificationsRe-


Current assetsInventories A 717,860 (18,670) 699,190Trade and other receivables D 4,105,998 (670,695) (969) 3,434,334Other current assets - 601,738 601,738Cash and short-term deposits 18,861 18,861

4,842,719 (87,626) (969) 4,754,123

Total assets 22,865,248 (2,724,575) (75,016) 20,065,656

Issued capital 1,352,689 - - 1,352,689Share premium 2,953,228 - - 2,953,228Capital reserve H 160,820 (160,820) - -Retained earnings H (6,026,333) 160,820 (146,330) (5,987,675)

Total equity (1,559,596) - (146,330) (1,681,758)

Non-current liabilitiesInterest-bearing loans and borrowings 14,166,989 14,166,989Finance lease liabilities 15,429 15,429Employee defined benefit liability H 37,681 (21,086) 16,595Decommissioning and Site restoration provision B 37,745 68,232 105,977Deferred tax liabilities F 2,724,575 (2,724,575) -

16,982,419 (2,724,575) 71,314 14,304,989

Current liabilitiesTrade and other payables 3,964,406 3,964,406Bank overdraft 526,794 (526,794) -Interest-bearing loans and borrowings I 2,926,798 526,794 3,453,592Finance lease liabilities J 7,777 7,777Income tax payable K 16,650 16,650

7,442,425 - - 7,442,425





Group’s Reconciliation of equity as at 30 June 2013Nigerian

GAAPRe-

classificationsRe-


AssetsNon-current assetsProperty, plant and equipment A,B 13,353,745 (9,410) (22,603) 13,321,732Investments C 685,651 (685,651) - -Investment property C - 461,751 (101,751) 360,000Prepayments D 1,279,568 1,279,568Intangible assets A - 10,663 (41) 10,622Investment in subsidiary C - - - -Available for sale investment C - 223,900 - 223,900Deferred tax assets E 3,288,873 (3,277,499) 19,151 30,525Other long term assets D 1,414,945 (1,414,945) - -Loan receivables F 345,958 - 2,877 348,835

19,089,172 (3,411,622) (102,367) 15,575,183

Current assetsInventories A 382,777 1,253 - 384,030Trade and other receivables D 2,495,586 (530,926) 71,718 2,036,378Held to maturity D - 19,545 - 19,545Other current assets D - 720,743 - 720,473Cash and short-term deposits 859,076 - - 859,076

3,737,439 210,345 71,718 4,019,502

Total assets 22,826,611 (3,201,277) (30,649) 19,594,685

Equity and liabilitiesEquityIssued capital 1,352,689 - - 1,352,689Share premium 2,953,228 - - 2,953,228Capital reserve G 160,820 (160,820) - -Retained earnings (13,157,136) 160,820 (60,339) (13,056,655)Foreign currency translation reserve G 10,573 - (16,135) (5,562)

Total equity (8,679,826) - (76,474) (8,756,300)



Group’s Reconciliation of equity as at 30 June 2013 (cont’d)Nigerian

GAAPRe-

classificationsRe-


Non-current liabilitiesInterest-bearing loans and borrowings 17,437,492 - - 17,437,492Finance lease liabilities - - - -Employee defined benefit liability H 51,839 - (7,442) 44,397Decommissioning liabilities B 68,939 - 50,577 119,516Deferred tax liabilities F 3,288,873 (3,288,798) 2,537 2,609

20,847,143 (3,288,798) 45,669 17,604,014

Trade and other payables 3,611,196 91,820 - 3,703,016Interest-bearing loans and borrowings I 7,025,871 - 2,590 7,028,461Finance lease liabilities J 10,970 - (2,433) 8,537Income tax payable K 11,256 (4,299) - 6,957

10,659,294 87,52115 156 10,746,970





Company’s Reconciliation of equity as at 30 June 2013Nigerian

GAAPRe-

classificationsRe-


AssetsNon-current assetsProperty, plant and equipment A,B 13,269,861 (10,663) (16,136) 13,243,063Investments C 1,170,358 (1,170,358) - -Investment property C - 461,751 (101,751) 360,000Prepayments D - 1,279,568 - 1,279,568Intangible assets A - 10,663 (41) 10,622Investment in subsidiary C - 484,707 - 484,707Available for sale investment C - 223,900 - 223,900Deferred tax assets E 3,257,871 (3,257,871) - -Other long term assets D 1,414,945 (1,414,945) - -Loan receivables 408,376 - - 408,376

19,521,411 (3,393,248) (117,928) 16,010,236

Current assetsInventories 260,176 - - 260,176Trade and other receivables D 2,175,126 (482,937) (400) 1,691,789Other current assets D - 618,314 - 618,314Cash and short-term deposits 734,759 - - 734,759

3,170,061 135,377 (400) 3,305,038

Total assets 22,691,472 (3,257,871) (118,328) 19,315,274

Equity and liabilitiesEquityIssued capital 1,352,689 - - 1,352,689Share premium 2,953,228 - - 2,953,228Capital reserve G 160,820 (160,820) - -Retained earnings (12,743,104) 160,820 (135,969) (12,718,253)

Total equity (8,276,367) - (135,969) (8,412,336)



Company’s Reconciliation of equity as at 30 June 2013 (cont’d)Nigerian

GAAPRe-

classificationsRe-


Non-current liabilitiesInterest-bearing loans and borrowings 17,437,492 - - 17,437,492Finance lease liabilities - - - -Employee defined benefit liability H 51,839 - (32,936) 18,903Decommissioning liabilities B 68,939 - 50,577 119,516Deferred tax liabilities F 3,257,871 (3,257,871) - -

20,816,141 (3,257,871) 17,641 17,575,911

Current liabilitiesTrade and other payables 3,385,296 - - 3,385,296Interest-bearing loans and borrowings 6,746,609 - - 6,746,609Finance lease liabilities 8,537 - - 8,537Income tax payable 11,256 - - 11,256

10,151,698 - - 10,151,698





Group’s Reconciliation of comprehensive income as at 30 June 2013

NotesNigerian

GAAPRe-

classificationsRe-

measurements IFRS₦000 ₦000 ₦000 ₦000

Revenue 5,319,146 - - 5,319,146Cost of sales (3,922,476) - - (3,922,477)

Gross profit 1,396,670 - - 1,396,669Other operating income M 23,645 51,020 - 74,665Employee benefit expense H - (314,740) 8,915 (305,825)Depreciation & amortisation B (1,898,281) (4,379) (738) (1,903,398)Other operating expenses L (885,499) (2,598,429) 24,123 (3,459,805)Exceptional impairment of receivables L (2,879,201) 2,879,201 - -

Operating (loss) (4,242,666) 12,673 32,300 (4,197,694)

Finance costs J (2,549,035) (147,613) (12,877) (2,709,525)Finance income - 14,596 736 15,332Foreign exchange gain/ (loss) M 64,376 (64,376) - -

Profit/(loss) before taxation (6,727,325) (184,720) 20,159 (6,891,887)Income tax expense (11,336) 16,839 - 5,503

(6,738,661) (167,881) 20,159 (6,886,384)Extra ordinary item L (147,600) 147,600 -

Profit/(loss) for the year (6,886,261) (20,281) 20,159 (6,886,384)Other comprehensive incomeOther comprehensive income not to be reclassified to profit or loss in subsequent periods:Re-measurement gains (losses) on defined benefit plans H - - 233 233Other comprehensive income to be reclassified to profit or loss in subsequent periods :

Exchange differences on translation of foreign operations G - - (5,562) (5,562)

- - (5,329) (5,329)



Group’s Reconciliation of comprehensive income as at 30 June 2013 (cont’d)

NotesNigerian

GAAPRe-

classificationsRe-

measurements IFRS₦000 ₦000 ₦000 ₦000

Other comprehensive income for the year, net of tax - - (5,329) (5,329)

Total comprehensive loss for the year, net of tax (6,886,261) (20,281) 14,830 (6,891,713)



Company’s Reconciliation of comprehensive income as at 30 June 2013

Notes Nigerian GAAP

Re-classifications


₦000 ₦000 ₦000 ₦000

Revenue 4,340,917 - - 4,340,917Cost of sales (3,158,809) - - (3,158,810)

Gross profit 1,182,108 - - 1,182,107Other operating income 71,032 - 71,032Employee benefit expense H - (139,682) 17,364 (122,318)Depreciation & amortisation B (1,873,421) (4,112) (738) (1,878,271)Other operating expenses L (554,254) (2,715,771) (8,488) (3,278,513)Exceptional impairment of receivables L (2,855,455) 2,855,455 - -

Operating profit/(loss) (4,029,990) (4,110) 8,138 (4,034,836)

Finance costs J (2,537,664) (147,600) (12,877) (2,698,141)Finance income F - 9,808 736 10,543

Profit/(loss) before taxation H (6,567,654) (141,902) (4,003) (6,713,560)Income tax expense (11,336) - - (11,336)

(6,578,990) (141,902) (4,003) (6,724,896)Extra ordinary item L (147,600) 147,600 -

Profit/(loss) for the year (6,726,590) 5,698 (4,003) (6,724,896)Other comprehensive incomeOther comprehensive income not to be reclassified to profit or loss in subsequent periods:Re-measurement gains (losses) on defined benefit plans H - - (5,681) (5,681)Income tax effect - - - -

- - (5,681) (5,681)

Other comprehensive income for the year, net of tax E - - (5,681) (5,681)

Total comprehensive income for the year, net of tax (6,726,590) 5,698 (9,684) (6,730,577)



Notes to the reconciliation of equity as at 1 July 2012 and 30 June 2013 and total comprehensive income for the year ended 30 June 2013.

A, B Property, plant and equipment, Decommissioning liabilities and Intagible assets Under the Nigerian GAAP, the Group classified intangible assets as part of Property, plant and equipment.

On transition to IFRS, intangible assets were reclassified from Property, plant and equipment. In addition, decommissioning liabilities were recomputed in line with IFRS and the adjustment was recognised against the Retained earnings. Furthermore, Property, plant and equipment items (spare parts) that have a life cycle of 12 months were reclassified to inventories in line with IFRS requirements.

C Investments, Investment properties, Available for sale investments and Investments in subsidiaries The Group categorised investment properties, available for sale investments and Investments in subsidiaries

together as investment under NGAAP. On transition to IFRS, Investment properties were reclassified and recognised at fair value; while Available for sale investments and Investments in subsidiaries were reclassified.

D Trade and other receivables, Prepayments, Held to maturity, Other long term assets and Other current assets Under the N GAAP, Trade and other receivables, prepayments, Held to maturity assets, and Other current

assets were classifed as Debtors and prepayments. Under IFRS, the items were separately reclassified. Employee loans under trade receivables were remeasured and carried at amortised cost using the effective interest rate of 17%. On transition to IFRS, Other long term assets was seperated into prepayments and; Trade and other receivables.

E Deferred tax The various transitional adjustments lead to different temporary differences. Deferred tax adjustments are

recognised in correlation to the underlying transaction either in retained earnings or a separate component of equity.

F Loans and receivables Loans given to related parties were remeasured and recognised at their amortised cost on transition to IFRS.

G Foreign currency translation reserve and Capital reserve Under Nigerian GAAP, the Group recognised capital reserve and translation differences on foreign operations

in a separate component of equity. Capital reserve and Cumulative currency translation differences for all foreign operations are deemed to be zero as at 1 July 2012. The resulting adjustment was recognised against retained earnings.

H Employee benefit liability (Defined benefit obligations) Under the Nigerian GAAP, the Group recognised costs related to its gratuity plan on a cash basis. Under

IFRS, gratuity liabilities are recognised on an actuarial basis. The gratuity liability has been recognised in full against retained earnings.

I Interest bearing loans and borrowings Interest bearing loans and borrowings that were previously carried at their nominal values under the Nigerian

GAAP are now carried at amortised cost under IFRS

J Finance lease liabilities Under the Nigerian GAAP, the Finance lease liabilities were recognised at nominal values. On transition to

IFRS, finance lease liabilities were present valued.

K Income tax payable On transition to IFRS, taxes of subsidiaries that were not previously consolidated under the NGAAP were

consolidated.

L Other operating expenses Exceptional impairment of receivables and extra ordinary item (impairment of available for sale investment)

were reclassified to other operating expenses on transition to IFRS.



M Other operating income This relates to reclassification adjustment is respect of exchange gain to other operating income

N Statement of cash flows The transition from Nigerian GAAP to IFRS has not had a material impact on the statement of cash flows.

4 Significant accounting judgements, estimates and assumptions The preparation of the Group’s consolidated financial statements requires management to make

judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the acGrouping disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods.

4.1 Judgements In the process of applying the Group’s accounting policies, management has made the following judgements,

which have the most significant effect on the amounts recognised in the financial statements: 4.1.1 Finance lease commitments — group as leesse The Company has entered into leases on its motor vehicles. The Company has determined, based on an

evaluation of the terms and conditions of the arrangements, such as the lease term constituting a substantial portion of the economic life of the motor vehicles, that it retains all the significant risks and rewards of ownership of these vehicles and accounts for the contracts as finance lease.

4.2 Estimates and assumptions The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting

date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Group based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur.

A. Taxes Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit

will be available against which the losses can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits, together with future tax planning strategies.

B. Defined benefit plans (gratuity) The cost of the defined benefit gratuity plan are determined using actuarial valuations. An actuarial valuation

involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates and future pension increases. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

In detemining the appropriate discount rate, management considers the interest rates of government bond to correspond with the expected term of the defined benefit obligation. The rate of mortality used for employees are the rates published in the A49/52 Ultimate Tables, published jointly by the Institute and Faculty of Actuaries in the UK.”

C. Fair value measurement of financial instruments When the fair value of financial assets and financial liabilities recorded in the statement of financial position

cannot be measured based on quoted prices in active markets, their fair value is determined using valuation techniques including the Asset based model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. The judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions relating to these factors could affect the reported fair value of financial instruments



D. Contingencies By their nature, contingencies will only be resolved when one or more uncertain future events occur or fail

to occur. The assessment of the existence, and potential quantum, of contingencies inherently involves the exercise of significant judgment and the use of estimates regarding the outcome of future events.

E. Impairment of non-financial assets An impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable

amount, which is the higher of its fair value less costs to sell and its value in use. The fair value less costs to sell calculation is based on available data from binding sales transactions, conducted at arm’s length for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a discounted cash flow model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Group is not yet committed to or significant future investments that will enhance the asset’s performance of the CGU being tested. The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well as the expected future cashinflows and the growth rate used for extrapolation purposes. The key assumptions used to determine the recoverable amount for the different CGUs is disclosed in the Notes.

F. Provision for decommissioning As part of the construction cost of cell sites, the Group has recognised a provision for decommissioning

obligations. In determining the fair value of the provision, assumptions and estimates are made in relation to discount rates, the expected cost to dismantle and remove the factory from the site and the expected timing of those costs. The carrying amount of the provision as at 30 June 2014 was N134,318,000 (2013: N119,516,000; As at 1 July 2012: N105,977,000) using a pre-tax discount rate of 17%.”

5 Standards issued but not yet effective The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the

Group’s financial statements are disclosed below. The Group intends to adopt these standards, if applicable, when they become effective.

IFRS 9 Financial Instruments IFRS 9, as issued, reflects the first phase of the IASB’s work on the replacement of IAS 39 and applies to

classification and measurement of financial assets and financial liabilities as defined in IAS 39. The standard was initially effective for annual periods beginning on or after 1 January 2013, but Amendments to IFRS 9 Mandatory Effective Date of IFRS 9 and Transition Disclosures, issued in December 2011, moved the mandatory effective date to 1 January 2015. In subsequent phases, the IASB is addressing hedge accounting and impairment of financial assets. The adoption of the first phase of IFRS 9 will have an effect on the classification and measurement of the Group’s financial assets, but will not have an impact on classification and measurements of the Group’s financial liabilities. The Group will quantify the effect in conjunction with the other phases, when the final standard including all phases is issued.

Amendments to IAS 19 Defined Benefit Plans: Employee Contributions “IAS 19 requires an entity to consider contributions from employees or third parties when accounting for

defined benefit plans. Where the contributions are linked to service, they should be attributed to periods of service as a negative benefit.

These amendments clarify that, if the amount of the contributions is independent of the number of years of service, an entity is permitted to recognise such contributions as a reduction in the service cost in the period in which the service is rendered, instead of allocating the contributions to the periods of service. This amendment is effective for annual periods beginning on or after 1 July 2014. It is not expected that this amendment would be relevant to the Group because the defined benefit plan operated by the Group is unfunded.”

IFRS 15 Revenue from Contracts with Customers IFRS 15 was issued in May 2014 and establishes a new five-step model that will apply to revenue arising from

contracts with customers. Under IFRS 15 revenue is 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. The principles in IFRS 15 provide a more structured approach to measuring and recognising revenue. The new revenue standard is applicable to all entities and will supersede all current revenue recognition requirements



under IFRS. Either a full or modified retrospective application is required for annual periods beginning on or after 1 January 2017 with early adoption permitted. The Group is currently assessing the impact of IFRS 15 and plans to adopt the new standard on the required effective date.

Group Company 30-Jun-2014 30-Jun-2013 30-Jun-2014 30-Jun-20136. Revenue N 000 N 000 N 000 N 000 Site construction & Managed services 164,343 379,656 - - Co-location sales 2,936,066 4,340,917 2,936,066 4,340,917 Engineering and Project 277,974 82,295 - - Oil and Gas 33,444 38,120 - - Haulage 25,367 4,543 - - Power 316 6,231 - - Diesel 13,028 467,384 - -

3,450,538 5,319,146 2,936,066 4,340,917

7 Cost of sales

Cost of goods sold 3,059,604 3,922,477 2,865,793 3,158,810

Cost of goods sold include the followings: Labour cost 2,040,756 2,667,284 1,921,986 2,147,990 Material cost 1,018,848 1,255,193 943,807 1,010,820

8 Other operating income

Rental income (Note 16) 4,750 4,684 4,750 4,684 Foreign exchange gain/(loss) 12,860 66,767 2,817 64,573 Profit on disposal of PPE 325 1,125 - - Fair value gain on investment properties (Note 16) 40,000 - 40,000 - Others 20,210 2,089 16,752 1,775

78,145 74,665 64,319 71,032

9 Employee benefit expenses

Salaries & Wages 141,232 183,178 43,754 42,322 Gratuity 14,667 14,808 7,040 6,359 Pension 9,449 10,966 3,227 5,324 Allowances 87,764 96,873 40,731 68,312

253,112 305,825 94,571 122,318

10 Depreciation and Amortization

Depreciation 1,723,604 1,899,286 1,689,073 1,874,159 Amortization 4,112 4,112 4,112 4,112

1,727,716 1,903,398 1,693,185 1,878,271



11 Other operating expenses Group Company 30-Jun-2014 30-Jun-2013 30-Jun-2014 30-Jun-2013 N 000 N 000 N 000 N 000

Advertisement and promotions 1,930 492 1,930 492 Audit fees 24,156 23,383 17,325 17,325 Bank charges 15,939 30,132 10,607 22,467 Business development 338,934 177,425 338,240 173,964 Director’s fees 36,810 800 36,810 800 Donations - 668 - 395 Fuel – Office generators 9,984 8,916 9,984 8,916 General office expenses 145,024 111,106 30,294 24,992 Insurance and licenses 13,790 12,642 8,457 10,195 Legal and professional fees 70,699 37,544 63,168 29,022 License fees and subscription 2,820 2,705 2,103 1,580 Loss on disposal of PPE 30,997 18,555 30,997 18,555 Exchange loss 1,758 201 61 - Motor vehicles maintenance 12,533 23,942 11,431 16,667 Printing and stationery 5,277 7,337 5,100 7,138 Rent and rates 57,605 51,492 32,854 31,837 Impairment allowance 205,693 2,879,004 44,208 2,855,455 Impairment of investment properties - 8,500 - 8,500 Repairs and maintenance 19,337 5,730 2,354 1,788 Security 3,748 3,706 2,688 2,588 Telephone & postages 8,837 9,678 5,723 5,751 Training and development 5,792 2,662 3,443 2,419 Travelling 28,024 43,185 19,018 37,668

1,039,686 3,459,805 676,797 3,278,513

12 Finance income

Interest income on loans 1,478 1,539 1,176 1,476 Interest income on short term deposits 10,060 1,129 6,858 9,067 Investment income - 12,664 - -

11,538 15,332 8,034 10,543

13 Finance cost

Interest and similar charges 3,013,469 2,549,048 2,951,654 2,537,664 Unwinding charge - decommissioning liability 14,802 12,877 14,802 12,877 Impairment of AFS 39,300 147,600 39,300 147,600

3,067,571 2,709,525 3,005,756 2,698,141



14 Income tax

14.1 Income tax expense

The components of income tax expense for the years ended 30 June 2014 and 2013 are:

Statement of profit or loss Group Company 30-Jun-2014 30-Jun-2013 30-Jun-2014 30-Jun-2013 N 000 N 000 N 000 N 000 Current income tax: Company income tax 8,327 25,200 7,068 11,336 Education tax - - - -

8,327 25,200 7,068 11,336 Deferred tax (19,987) (30,703) - -

Income tax expense reported in the profit or loss (11,660) (5,503) 7,068 11,336

Other comprehensive income Re-measurement gains 2,159 2,535 - -

2,159 2,535 - -

14.2 Reconciliation of the total tax charge Accounting loss before tax (5,607,468) (6,891,887) (5,327,863) (6,713,561)

At Nigeria’s statutory income tax rate of 30% (1,682,240) (2,070,228) (1,600,647) (2,016,730) Effect of minimum tax 1,670,580 2,064,725 1,607,715 2,028,066

The effective income tax (11,660) (5,503) 7,068 11,336

14.3 Deferred tax assets

Opening balance as of 1 January 30,525 - - - Tax income during the period 25,390 30,525 - - Other comprehensive income - - - -

Closing balance as at 31 December 55,915 30,525 - -

14.4 Deferred tax liabilities

Opening balance as of 1 January 2,609 74 - - Tax expense during the period 6,500 - - - Other comprehensive income 2,159 2,535 - -

Closing balance as at 31 December 11,268 2,609 - -



Group Company 30-Jun-2014 30-Jun-2013 30-Jun-2014 30-Jun-2013 N 000 N 000 N 000 N 000 14.5a Statement of financial position

Accelerated depreciation for tax purpose 55,915 30,525 - - Defined benefit obligation - - - -

Deferred tax assets 55,915 30,525 - -

The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.

14.6 Reconciliation of current tax liabilities Group Company 30-Jun-2014 30-Jun-2013 30-Jun-2014 30-Jun-2013 N 000 N 000 N 000 N 000 Opening balance at 1 January 6,957 23,470 11,256 16,650 Tax charge in profit or loss 8,327 25,200 7,068 11,336

15,284 48,670 18,324 27,986 Payment during the year 4,517 (41,713) - (16,730) Withholding tax set-off - -

Closing balance at 31 December 19,801 6,957 18,324 11,256



15

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Impairment lossThere were no impairment loss during the year (2013: Nnil; As at 1 July 2012: Nnil).

Finance leasesThe carrying value of Motor vehicles held under finance leases at 30 June 2014 was N49 million (2013: 16 million; As at 1 January 2012: 58 million). The leased assets are pledged as security for the related finance lease liabilities.

16 Investment properties Group 30-Jun-14 30-Jun-13 1-Jul-12 N 000 N 000 N 000 Opening balance 360,000 368,500 368,500 Write-off (8,500) Net gains/(loss) from fair value adjustment 40,000 Closing balance 400,000 360,000 368,500

Company 30-Jun-14 30-Jun-13 1-Jul-12 N 000 N 000 N 000 Opening balance 360,000 368,500 368,500 Write-off (8,500) Net gains/(loss) from fair value adjustment 40,000

Closing balance 400,000 360,000 368,500

The Company’s investment properties consist of a residential property at Victoria Garden City, Lagos State and undeveloped hectres of land at Mowe-Ibafo, Ogun state. As at 30 June 2013 and 2012, the fair values of the properties are based on valuations performed by Rogba Orimalade & Co. Chartered Surveyors, an accredited independent valuer. Rogba Orimalade Chartered Surveyors & Co. is a specialist in valuing these types of investment properties. The valuation model is in accordance with that recommended by the International Valuation Standards Committee has been applied.

30-Jun-14 30-Jun-13 N 000 N 000 Rental income derived from investment properties 4,750 4,684 Direct operating expenses generating rental income - - Direct operating expenses that did not generate rental income - - Profit arising from investment properties carried at fair value 40,000 -

44,750 4,684

The company has no restrictions on the realisability of its investment properties and no contractual obligations to purchase, construct or develop investment properties or for repairs, maintenance and enhancements.

Reconciliation of fair value ₦000 As at 1 July 2012 368,500 Remeasurement recognised in profit or loss - Write off (8,500)

As at 30 June 2013 360,000 Remeasurement recognised in profit or loss 40,000

As at 30 June 2014 400,000



Description of valuation techniques used and key inputs to valuation on investment properties:The valuation figures were arrived at after considering several approaches. These include the investment approach based on the estimated Open market rental value of the property in its present sate, together with all the facilities provided and with due allowances for outgoings repairs and management. Replacement cost approach was also adopted based on the estimated cost of replacing the existing structure in its present condition together with all the facilities presently in place and with reasonable allowance for the cost of acquiring the vacant site based on prevailing open market rates in this neighbourhood. Finally, the values were buttressed with the available evidence of recent sale of properties within this neighbourhood in the open market.

17 Intangible Assets Group Company Computer software Computer software ₦000 ₦000CostAt 1 July 2012 20,559 20,559 Additions - -

At 30 June 2013 20,559 20,559 Additions - -

At 30 June 2014 20,559 20,559

Accumulated depreciationAt 1 July 2012 5,825 5,825 Charge for the year 4,112 4,112 Disposals - -

At 30 June 2013 9,937 9,937 Charge for the year 4,112 4,112

At 30 June 2014 14,049 14,049

Net book valueAt 30 June 2014 6,510 6,510

At 30 June 2013 10,622 10,622

At 1 July 2012 14,734 14,734

18 Group informationInformation about subsidiariesThe consolidated financial statements of the Group include: % equity interest

Name Year of

IncorporationCountry of

incorporation 2014 2013As at 1

July 2012Swap Technologies & Telecomms (Ghana) Ghana 100% 100% 100%Swap Technologies & Telecomms (CI) Cote d’ivoire 100% 100% 100%Prime Infrastructure & Engineering Services Limited Nigeria 100% 100% 100%



18a Investments in SubsidiariesGroup Company

30-Jun-14 30-Jun-13 1-Jul-1230-Jun-

1430-Jun-

13 1-Jul-12N 000 N 000 N 000 N 000 N 000 N 000

Swap Technologies & Telecomms (Ghana) - - - 185,961 185,961 43,506Swap Technologies & Telecomms (CI) - - - 49,857 49,857 49,857Prime Infrastructure & Engineering Services Limited - - - 248,889 248,889 -

- - - 484,707 484,707 93,363

Year of Incorporation

Country of Incorporation % ownership Nature of business

Swap Technologies & Telecomms (Ghana) Ghana 100

Provision of telecommunication support services to mobile networks; and building and maintenance of masts and other equipment’s.

Swap Technologies & Telecomms (CI) Cote d’ivoire 100

Provision of telecommunication support services to mobile networks; and building and maintenance of masts and other equipment’s.

Prime Infrastructure & Engineering Services Limited Nigeria 100

Provision of engineering, managed services, procurement, construction, installation and maintenance services to various sectors of the Nigerian Economy.

19 PrepaymentsGroup Company

30-Jun-14 30-Jun-13 1-Jul-12 30-Jun-14 30-Jun-13 1-Jul-12N 000 N 000 N 000 N 000 N 000 N 000

Advance payment of syndicated loans 1,023,655 1,279,568 103,956 1,023,655 1,279,568 103,956



20Available for sale investments

Group Company30-Jun-14 30-Jun-13 1-Jul-12 30-Jun-14 30-Jun-13 1-Jul-12

N 000 N 000 N 000 N 000 N 000 N 000Quoted 500 500 600 500 500 600Unquoted companies 184,100 223,400 370,900 184,100 223,400 370,900

184,600 223,900 371,500 184,600 223,900 371,500

Impairment lossQuoted 9,296 9,296 9,196 9,296 9,296 9,196

Unquoted companies 755,050 715,750 568,250 755,050 715,750 568,250

764,346 725,046 577,446 764,346 725,046 577,446

Available for sales (AFS) financial assets — unquoted equity sharesA significant portion of the AFS financial assets consist of an investment in equity shares of a non-listed company, which are valued based on non-market observable information.

AFS financial assets — quoted equity sharesThe Group has investments in listed equity. The fair value of the quoted equity shares is determined by reference to published price quotations in an active market.

Impairment on AFS financial assetsFor AFS financial investments, the Group assesses at each reporting date whether there is objective evidence that an investment or a group of investments is impaired. In the case of equity investments classified as AFS, objective evidence would include a significant or prolonged decline in the fair value of the investment below its cost. The determination of what is ‘significant’ or ‘prolonged’ requires judgement. In making this judgement, the Group evaluates, among other factors, historical share price movements and the duration or extent to which the fair value of an investment is less than its cost.

Based on this assessment, the Company identified an impairment of N9,296,000 on AFS quoted equity securities and an impairment of N755,000,000 on AFS unquoted equity securities , both of which are recognised within finance costs in the statement of profit or loss (Note 13).

21a Loan receivablesGroup Company


Non current interest free loan to Cote d’Ivoire - 2,877 - 62,418 62,418 62,418Other share loan to Swap Engineering(Note 34b) 155,687 345,958 345,958 155,187 345,958 345,958

155,687 348,835 345,958 217,605 408,376 408,376



21b Trade and other receivablesGroup Company


Trade receivables 352,111 773,268 2,377,382 226,525 574,655 2,223,517Due from related parties(Note 31b) 37,373 108,710 47,174 77,940 92,863 238,035Employee receivables 71,574 74,593 111,099 70,653 72,678 110,191VAT receivables 120,374 87,472 65,883 120,374 87,472 65,883Witholding tax receivables 1,101,672 957,335 787,523 919,016 829,121 761,708Share Loan 4,550 35,000 35,000 15,700 35,000 35,000

1,687,655 2,036,378 3,424,061 1,430,208 1,691,789 3,434,334

Trade receivables are non-interest bearing and are generally on terms of 30-90 days.

As at 30 June 2014, trade receivables of an initial value of N3,242,529,000 (2013: N3,133,694,000; as at 1 July 2012: N254,125,000) were impaired and fully provided for. See below for the movements in the provision for impairment of receivables. Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 As at beginning of the year 3,133,694 254,125 3,109,580 254,125 Charge for the year 124,479 2,879,569 - 2,855,455 Unused amounts reversed (15,644) - (15,644) - As at end of the year 3,242,529 3,133,694 3,093,936 3,109,580

Impairment on loans and receivablesThe Group assesses at each reporting date whether there is objective evidence that a receivable is impaired. In the case of employee receivables classified as loans and receivables, objective evidence would include a breach of contract, such as a default or delinquency in principal payments. Based on this assessment, the Group identified an impairment of N2,596,818 on employees’ receivables. The impairment on employee receivables is recognised within employee costs in the statement of profit or loss.

As at 31 December, the ageing analysis of trade and other receivables is, as follows:Group

Past due but not impaired

Total

Neither past due nor

impaired< 90 days

90 - 180 days

180 - 360 days

360 days and 2 years

2 years and

aboveN 000 N 000 N 000 N 000 N 000 N 000 N 000

At 1 July 2012 3,424,061 1,881,130 396,056 220,528 309,316 617,031 -At 30 June 2013 2,036,378 711,169 18,350 307,754 248,022 751,083 -At 30 June 2014 1,687,655 442,496 14,810 136,252 282,661 811,436 -



CompanyPast due but not impaired

Total

Neither past

due nor impaired

< 90 days

90 - 180 days

180 - 360 days

360 days and 2 years

2 years and

aboveN 000 N 000 N 000 N 000 N 000 N 000 N 000

At 1 July 2012 3,434,334 1,891,403 396,056 220,528 309,316 617,031 -At 30 June 2013 1,691,789 704,233 18,350 307,754 248,022 413,430 -At 30 June 2014 1,430,208 416,862 14,810 136,252 282,661 579,623 -

22 InventoriesGroup Company


Finished goods 198,249 359,334 718,687 152,030 260,176 699,190Spare parts 3,219 11,858 - - -Materials 62,863 12,838 - - - -

264,331 384,030 718,687 152,030 260,176 699,190

Inventories are valued at the lower of cost and net realisable value. The cost of inventories recognised as an expense and included in cost of sales amounted to N82.96million (2013: Nil). The Group has not pledged any inventory as collateral for loans

23 Held to MaturityGroup Company


Treasury bill 12,528 19,545 20,887 - - -

12,528 19,545 20,887 - - -

This is a 90 day time deposits, at 8.30% interest rate, with a bank with rollover of principal only upon maturity. The principal has been roll over since the initial investment.

24 Other current assetsGroup Company


Prepaid site lease & rentals 589,135 622,156 451,054 574,106 596,976 445,931Staff advances 2,896 5,552 34,750 - 4,339 30,816Construction works recoverable 48,727 92,766 187,945 - 16,999 124,991

640,758 720,474 673,749 574,106 618,314 601,738



25 Cash and BankGroup Company


Cash and Bank 57,504 251,076 49,271 45,641 126,759 10,861Short-term deposits 8,000 608,000 8,000 8,000 608,000 8,000

65,504 859,076 57,271 53,641 734,759 18,861

For the purpose of the statement of cash flows, cash and cash equivalents comprise the following:


N 000 N 000 N 000 N 000 N 000 N 000Cash and Bank 57,504 251,076 49,271 45,641 126,759 10,861Short-term deposits 8,000 608,000 8,000 8,000 608,000 8,000Bank overdraft(Note 27b) (180,453) - (526,794) - - (526,794)Cash and cash equivalents (114,949) 859,076 (469,523) 53,641 734,759 (507,933)

Cash at banks earns interest at floating rates based on daily bank deposit rates.

26 Issued capital Group Company

30-Jun-14 30-Jun-13 1-Jul-12 30-Jun-14 30-Jun-13 1-Jul-12 N 000 N 000 N 000 N 000 N 000 N 000Authorised shares: Ordinary shares of 3,000,000,000 at 50k each 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000

26.1 Issued and fully paid:2,705,377,141 ordinary shares of 50k each 1,352,689 1,352,689 1,352,689 1,352,689 1,352,689 1,352,689

26.2 Share premium 2,953,228 2,953,228 2,953,228 2,953,228 2,953,228 2,953,228



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$125,000,000 Syndicated loan This loan is a drawn down under a six-year multi-option facility (MOF). The loan was given by Afrexim bank

in conjuction with Diamond Bank Plc, First bank Plc, Unity Bank Plc, and Eco International Bank. The loan is repayable within 9 months after the reporting date, but has been classified as long term because the Group expects, and has the discretion, to exercise its rights under the MOF to refinance this funding. Such immediate replacement funding is available until 2018. The facility is secured by a first charge over certain of the Group’s land and buildings, with a carrying value of N11,491,263,000 (2013: N17,437,492,000, 1 July 2012: N12,193,171,000). It has an interest rate of LIBOR + a margin of 6.4% and 6.9%.

First bank USD loan The loan is secured by a first charge over all other present and future assets of the Group with a carrying

value of $17,133,000 for a tenor of 3 years at an interest rate of LIBOR + 7% p.a.

First bank Naira loan This loan has been drawn down under a three and a half -year multi-option facility (MOF). The facility

is secured by a first charge over certain of the Group’s tripartite warehousing agreement with Cotech Commercial inspection Limited and First Bank. The loan has now been converted to USD loan as part of the Syndicated loan.

Bank overdrafts The overdrafts facilities have a tenor of 365 days with an option of renewal. The applicable interest rates on

the facilities range between 16.5% and 18%. The facilities are secured by a legal mortgage over the company investment property located at Plot F113 –F114 Road 36 VGC; and against the shares of the company, tripartite warehousing agreement and the personal guarantee of the Managing Director.

Fidelity Bank loan This loan has been drawn down under a three year facility. The loan is repayable within 12 months after

the reporting date. The total amount repayable on maturity is N523,200,000. The facility is secured by the personal guarantee of the MD/CEO supported by his notarized statement of Networth. The interest rate is 15% per annum.

N500,000,000 Commercial papers The commercial papers are issued against the corporate guarantee of the company at an interest rate of

19%. The Commercial papers have a maturity period of 180 days and it is rolled over at maturity. N80,000,000 bridging loan This loan is secured and has a tenor of 60 days. As of 30 June 2014, the loan has been fully paid.

GTB Bank (Ghana) Interest bearing loans and borrowings are secured by a fixed deposit pledge funds account throughout

the tenor of the facility and evidenced by a duly executed letter of set-off. Current interest rate is 26%. The carrying amount is considered to be a reasonable approximation of the fair value.



28 Fair value measurement The following table provides the fair value measurement hierarchy of the Group’s assets and liabilities.

Fair value measurement using

Date of valuation Total

Quoted prices in

active markets (Level 1)

Significant observable

inputs (Level 2)

Significant unobservable

inputs (Level 3)

30-Jun-14Assets measured at fair valueAvailable for sale investmentsQuoted shares 500 500 - -Unquoted shares 184,100 - - 184,10030-Jun-13Assets measured at fair valueAvailable for sale investmentsQuoted shares 500 500 - -Unquoted shares 223,400 - - 223,400

1-Jul-12 Assets measured at fair value Available for sale investments Quoted shares 600 600 - - Unquoted shares 370,900 - - 370,900

There have been no transfers between Level 1 and Level 2 during the period.

Fair value hierarchy All financial instruments for which fair value is recognised or disclosed are categorised within the fair value

hierarchy, based on the lowest level input that is significant to the fair value measurement as a whole, as follows:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value

measurement is directly or indirectly observable Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value

measurement is unobservable

For assets and liabilities that are recognised at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

Valuation methods and assumptionsd. a. Fair value of remaining available-for-sale financial assets is derived from quoted market prices in

active markets.e. b. Fair value of the unquoted ordinary shares has been estimated using an Asset based model. The

valuation requires management to review the net assets and financial performance of the companies whose unquoted equities were bought. The net asset per share of the companies were used in management’s estimate of fair value for these unquoted equity investments



29 Fair values

Set out below is a comparison by class of the carrying amounts and fair values of the financial instruments that are carried in the financial statements.

GroupCarrying amount Fair value


Financial assetsAvailable for sale investment 184,600 223,900 371,500 184,600 223,900 371,500Treasury bill 12,526 19,545 20,887 12,526 19,545 20,887Loan receivables 155,187 348,835 345,958 155,186 348,835 345,958Trade and other receivables 1,687,655 2,036,378 3,424,061 1,663,246 2,075,991 3,424,061Cash and short-term deposits 65,504 859,076 57,271 65,504 859,076 57,271

2,105,472 3,487,734 4,219,677 2,081,062 3,527,347 4,219,677

Financial liabilitiesTrade and other payables 6,272,926 3,703,016 4,170,093 6,272,926 3,703,016 4,170,093Interest-bearing loans and borrowings 24,308,405 24,465,954 17,620,580 24,108,983 24,184,101 17,620,580

30,581,331 28,168,970 21,790,673 30,381,909 27,887,117 21,790,673

CompanyCarrying amount Fair value


Financial assetsAvailable for sale investment 184,600 223,900 371,500 184,600 223,900 371,500Treasury bill - - - - - -Loan receivables 217,605 408,376 408,376 217,605 408,376 408,376Trade and other receivables 1,430,208 1,691,789 3,434,334 1,430,208 1,691,789 3,434,334Cash and short-term deposits 53,641 734,759 18,861 53,641 734,759 18,861

1,886,054 3,058,824 4,233,071 1,886,054 3,058,824 4,233,071Financial liabilitiesTrade and other payables 5,876,786 3,385,296 3,964,406 5,876,786 3,385,296 3,964,406Interest-bearing loans and borrowings 24,108,983 24,184,101 17,620,580 24,108,983 24,184,101 17,620,580

29,985,767 27,569,397 21,584,986 29,985,767 27,569,397 21,584,986



The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

Cash and bank, trade and other receivables, trade and other payables and other current financial assets and

liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

30 Finance lease liabilities


N 000 N 000 N 000 N 000 N 000 N 000Non-current 4,422 - 15,429 4,422 - 15,429Current 20,251 8,537 7,777 20,251 8,537 7,777

24,673 8,537 23,206 24,673 8,537 23,206

The Company has finance leases contracts for its motor vehicles. The Company’s obligations under finance leases are secured by the lessor’s title to the leased assets. Future minimum lease payments under finance leases with the present value of the net minimum lease payments are, as follows:

2014 2013 1 July 2012N 000 N 000 N 000 N 000 N 000 N 000

Minimum payment

Present value of

minimumMinimum payment

Present value of

minimumMinimum payment

Present value of

minimumWithin one year 24,545 20,251 9,876 8,537 20,061 7,777After one year but not more than five years 4,148 4,422 - - 9,877 15,429

Total minimum lease payment 28,693 24,673 9,876 8,537 29,938 23,206Less amount representing fee charges (4,020) - (1,339) - (6,732) -

Present value of minimum lease payments 24,673 24,673 8,537 8,537 23,206 23,206

31 Employee benefit liabilityGroup Company


Gratuity 46,131 43,071 16,595 20,497 18,903 16,595Long-service benefits - 1,326 954 - -

46,131 44,397 17,549 20,497 18,903 16,595



The Group has an unfunded defined benefit gratuity plan. Covering substantially all of its employees. The defined benefit plan is a final salary plan. The Group makes provisions for gratuity for employees from day one of employment in the Group. The employee qualifies to receive the gratuity on resignation or retirement after he/she might have spent minimum of 5 years. The level of benefits provided depends on the member’s length of service and salary at retirement age.

The gratuity liability is adjusted to inflation, interest rate risks and changes is salary for the beneficiaries. The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the statement of financial position for the respective plans:

Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 Current service cost 7,411 8,025 2,592 2,143 Interest cost on benefit obligation 7,257 7,207 4,448 4,216

Net benefit expense 14,568 15,232 7,040 6,359 Re-measurement gains/(losses) in other comprehensive income

Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 Re-measurement gains and (losses) on defined benefit plans 6,367 2,768 (831) (5,681) Income tax effect (2,159) (2,535) - -

4,208 233 (831) (5,681)

Changes in the present value of the defined benefit obligation are, as follows:

Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 Defined benefit obligation at 1 January 43,071 40,339 18,903 16,595 Current service cost 7,411 8,025 2,592 2,143 Interest cost 7,257 7,207 4,448 4,216 Benefits paid by the employer (6,276) (9,732) (6,276) (9,732) Actuarial gains/losses (6,367) (2,768) 831 5,681

Defined benefit obligation at 31 December 45,096 43,071 20,498 18,903

The principal assumptions used in determining defined benefit obligations for the Group’s plans are shown below:

2013 2012As at 1 January

2012% % %

Discount rate 12.50% 13% 13%Future salary increases 10% 11% 11%Inflation rate 9% 10% 10%

Years Years YearsLife expectation



A quantitative sensitivity analysis for significant assumption as at 30 June 2014 is as shown below:

Assumptions Discount rate Salary increases Mortality

Sensitivity Level1%

increase1%

decrease1%

increase1%

decrease

Age rated up by one

year

Age rated down by one year

N000 N000 N000Impact on the net defined benefit obligation 41,022 49,838 50,134 40,714 45,232 44,976

The sensitivity analyses above have been determined based on a method that extrapolates the impact on net defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period.

The following payments are expected contributions to be made in the future years out of the defined benefit plan obligation:


N 000 N 000 N 000 N 000 N 000 N 000Within the next 12 months (next annual reporting period) 3,411 3,041 - 3,411 3,041 -Between 2 and 5 years 22,762 22,744 18,222 22,762 22,744 18,222Between 5 and 10 years 76,513 55,860 55,860 76,513 55,860 55,860Beyond 10 years - - -

Total expected payments 102,686 81,645 74,082 102,686 81,645 74,082

The average duration of the defined benefit plan obligation at the end of the reporting period is 10 years (2013: 11 years).

31b Other long term employee obligation Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 Balance as at 1 July 1,326 954 - - Current service cost 252 302 - - Interest cost 187 212 - - Remeasurements: (197) (69) - - Exchange difference (531) (74) - -

Balance as at 30 June 1,037 1,325 - -



Amounts recognised in profit or loss related to other long term employee benefits are as follows:

Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 Current service cost 252 302 - - Interest cost 187 212 - - Remeasurements: (197) (69) - - Exchange difference (531) (74) - -

Balance as at 30 June (289) 371 - -

The significant actuarial assumptions for the determination of the other employee benefits obligation are the discount rate, the salary growth rate and the rate staff turnover. The calculation of the other long term employee benefit liability is sensitive to these assumptions

2014 2013 Discount rate Increase/(decrease) in the other long Increase (decrease) in the other long term liability 17% 23% Salary growth rate Increase/(decrease) in the other long term liability 5% 4% Staff turnover Increase/(decrease) in the other long term liability 7% 8%

32. Decommissioning liabilities This relates to the probable obligation that the company may incur on the Land in which its BTS towers

equipment are constructed. The amount recognised initially is the present value of the estimate of the amount that will be required to decommission and restore the leased sites to the original state, discounted using effective borrowing rate of the company. The amount provided for each site has been discounted based on the respective lease terms (up to 2020) attached to each site. The provisions have been created based on the decommissioning experts estimate and management’s experience of the specific situations. Assumptions based on the current economic environment have been made, which management believes are a reasonable basis upon which to estimate the future liability. These estimates are reviewed regularly to take into account any material changes to the assumptions. However, actual decommissioning costs will ultimately depend upon future market prices for the necessary decommissioning works required that will reflect market conditions at the relevant time. Furthermore, the timing of decommissioning is likely to depend on when the lease term is terminated without renewal. This in turn, will depend upon technological changes in local and international telecommunication industry which are inherently uncertain. The discount rate used in the calculation of the provision has been 17%.

The amount recognised in the statement of financial position are as follows:


N 000 N 000 N 000 N 000 N 000 N 000Decommissioning and site restoration provision 134,318 119,516 105,977 134,318 119,516 105,977

134,318 119,516 105,977 134,318 119,516 105,977



The movement in the decommissioning provision during the year is as follows Group Company 30-Jun-14 30-Jun-13 30-Jun-14 30-Jun-13 N 000 N 000 N 000 N 000 Balance at the Beginning of year 119,516 105,977 119,516 105,977 Unwinding of Interest 14,802 12,877 14,802 12,877 Additions/other changes in estimate - 662 - 662

Balance at End of year 134,318 119,516 134,318 119,516

33 Trade and other payables Group Company


Trade payables 1,694,788 1,114,688 1,552,458 1,428,764 849,587 1,472,860Due to related parties - - - - 52,115 -Witholding tax payables 487,398 843,250 654,101 436,566 801,266 575,313Accrued expenses (Note 33b) 3,718,031 1,624,899 1,750,731 3,716,261 1,609,416 1,750,731Other payables 372,709 120,179 212,803 295,195 72,912 165,501

6,272,926 3,703,016 4,170,093 5,876,786 3,385,296 3,964,405

Terms and conditions of the above financial liabilities: Trade payables are non-interest bearing and are normally settled on 60-day terms Other payables are non-interest bearing and have an average term of six months Other payables include back duty assessment, wages payables, pension payable etc

33b Accrued expensesGroup Company


Accrued rent 307,415 177,010 68,098 307,415 177,010 68,098 Accrued utility 279,499 530,625 214,514 279,499 530,625 214,514 Accrued interest 2,912,568 627,763 1,334,712 2,912,568 627,763 1,334,712 Others 218,549 289,501 133,407 216,779 274,018 133,407

3,718,031 1,624,899 1,750,731 3,716,261 1,609,416 1,750,731



34 Related party disclosures

The shareholding structure of the Group is as follow: % equity interest

2013 2012As at 1

January 2012Swap Associate Limited 30.12 30.12 30.12Titilayo Olatunde 18.76 18.76 18.76Keystone Bank 8.5 8.5 8.5PAC Capital Nominees 7.39 7.39 7.39Others 35.23 35.23 35.23

100 100 100

34b Related party

RelationshipNature of transaction

Balance receivable/

(payable) 30 June

2014

Balance receivable/

(payable) 30 June

2013

Balance receivable/

(payable) As at 1 July

2012₦000 ₦000 ₦000

Swap Engineering Other directors’ interests Share loan 155,187 345,958 345,958

Swap Associate

Entity with significant influence over the Group 196,182 47,174

152,187 542,140 393,132

Terms and conditions of transactions with related parties The transactions with related parties are made on terms equivalent to those that prevail in arm’s length

transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended 30 June 2014, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (2013: Nil As at 1 July 2012: Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

35. Earnings per share Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary

equity holders of the parent by the weighted average number of ordinary shares outstanding during the year.



The following reflects the income and share data used in the basic earnings per share computations:Group Company

2014 2013 2014 2013 N’000 N’000 N’000 N’000

Net Loss attributable to ordinary equity holders:

(5,595,808)

(6,886,384)

(5,334,931)

(6,724,897)

Weighted average number of ordinary shares for basic earnings per share

2,705,377

2,705,377

2,705,377

2,705,377

Basic earnings per share (Kobo) (207) (255) (197) (249)

There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of authorisation of these financial statements.

36 Compensation of Key management personnel 2014 2013 As at 1 July 2012 ₦000 ₦000 ₦000 Short-term employee benefits 45,467 43,365 26,622 Post-employment pension and Gratuity 7,819 - 6,352 Termination benefits - - -

Total compensation paid to key management personnel 53,286 43,365 32,974

The amounts disclosed in the table are the amounts recognised as an expense during the reporting period related to key management personnel.

37 Contingent liabilities There are legal actions against the Company estimated at N=9,350,075 (2013: N9,350,075; As at 1 July

2012:N9,350,075 ). The Company’s solicitors and the directors are of the opinion that the liabilities arising, if any are not likely to be significant. No provision has been made for these contingencies in the financial statements.

38 Capital commitments Capital commitments in respect of outstanding purchase orders being executed at the reporting date

amounted to N402 million.

39 Events after the reporting period Effective August 1, 2015, SWAP Nigeria entered into a Managed Service and Collocation Service Agreement

(MSCA) with Helios Towers Nigeria (HTN). Under the agreement, HTN will deploy its own resources for site upgrade and also provide passive infrastructure service to the existing tenants of SWAP. The MSCA also novates existing lease agreements between SWAP and its tenants in favour of HTN. In return, HTN is expected to pay SWAP $240 per month in respect of each tenants on a site.

In addition, on October 29 2015, SWAP Nigeria entered into an asset purchase agreement with HTN. The transaction is intended to enable HTN purchase all of SWAP’s tower sites and the Afrexim syndicated loans.

40 Financial risk management objectives and policies The Group’s principal financial liabilities comprise of loans and borrowings; and trade and other payables.

The main purpose of these financial liabilities is to finance the Group’s operations and to provide guarantees to support its operations. The Group’s principal financial assets include loan receivables, available for sale financial assets, held to maturity trade and other receivables, and cash and bank that derive directly from its operations. The Group is exposed to market risk, credit risk and liquidity risk. The Group’s senior management oversees the management of these risks. The Group’s senior management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the Group. The financial risk committee provides assurance to the Group’s senior management that the Group’s financial risk activities are governed by appropriate policies and procedures and that



financial risks are identified, measured and managed in accordance with the Group’s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because

of changes in market prices. Market risk comprise three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. The Company is exposed to interest rate risk, currency risk and equity price risk. Financial instruments affected by market risk include interest bearing loan and borrowings, cash and short term deposits, trade and other receivables and trade and other payables.

Foreign currency risk Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate

because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to long-term loans denominated in a currency different from the Company’s functional currency. To manage this risk, the Company is required to contract substantial amount of transactions in Naira which is the Company’s functional currency.

Changes in USD rate

Effect on profit before tax

N’0002014 0.05 9

-0.05 (9)2013 0.05 112

-0.05 (112)As at 1 July 2012 0.05 (993)

-0.05 993

Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate

because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long-term debt obligations with floating interest rates.

The company relies on the relative stability of the LIBOR rates. Increases are not likely to be material.

Interest rate sensitivity The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that

portion of interest bearing loans and borrowings affected. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows:

Changes in basis

pointEffect on profit

before tax2014 US dollar 0.05 2,873

US dollar -0.05 (2,873)2013 US dollar 0.05 4,359

US dollar -0.05 (4,359)As at 1 July 2012 US dollar 0.05 3,048

US dollar -0.05 (3,048)

The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market environment



Credit risk Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or

customer contract, leading to a financial loss. The Group is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks.

Trade receivables Customer credit risk is managed in line with the Group’s established policy, procedures and control relating

to customer credit risk management. The Group assesses the credit quality of the customers, taking into account the financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilisation of credit limits is regularly monitored to ensure debts are easily collected. The Group places premium on maintaining credit limits to ensure that there is little or no losses from non-performance by those counterparties.

Financial instruments and cash deposits Credit risk from balances with banks is managed by the Group’s account department in accordance with

the Group’s policy. The Group’s maximum exposure to credit risk for the components of the statement of financial position at 30 June 2014 and 2013; and 1 July 2012 is the carrying amounts as of the cash deposit.

Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with

its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The Group performs and monitors cash flow forecasts in the light of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient funds on a regular basis so that the Group does not breach any covenants. Such forecasting takes into consideration the Group’s debt financing plans, compliance with internal balance sheet ratio targets, etc. Surplus cash held by the Group over and above balance required for working capital management are invested in short-term instruments.

Excessive risk concentration Concentrations arise when a number of counterparties are engaged in similar business activities, or

activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Group’s performance to developments affecting a particular industry. In order to avoid excessive concentrations of risk, the Group’s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.



The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments.

Year ended 30 June 2014

On demand

Less than 3 months

3 to 12 months 1 to 5 years

> 5 years Total

N’000 N’000 N’000 N’000 N’000 N’000Interest bearing loans and borrowings 6,877,220 1,089,449 3,268,347 13,102,601 24,337,617Trade payables 508,435 508,435 677,913 1,694,783

Year ended 30 June 2013

On demand

Less than 3 months


> 5 years Total

N’000 N’000 N’000 N’000 N’000 N’000Interest bearing loans and borrowings 2,674,164 1,089,590 3,268,769 17,435,808 24,468,331Trade payables 334,405 334,405 445,873 1,114,683

Year ended as at 1 July 2012

On demand

Less than 3 months


> 5 years Total

N’000 N’000 N’000 N’000 N’000 N’000Interest bearing loans and borrowings 2,745,243 708,349 14,166,988 17,620,580Trade payables 465,737 465,737 620,983 1,552,457

Capital management For the purpose of the Group’s capital management, capital includes issued capital, retained earnings and

revaluation reserve attributable to the equity holders of the parent. The primary objective of the Group’s capital management is to maximise the shareholder value. In order to achieve this overall objective, the Group’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period. The Group manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Group monitors capital using a gearing ratio, which is interest bearing loans and borrowings divided by equity. The Group’s policy is to keep the gearing ratio to the barest minimum.

30-Jun-14 30-Jun-13 1-Jul-12 N’000 N’000 N’000 Interest bearing loans and borrowings 24,308,405 24,465,954 17,620,580 Equity (14,348,836) (8,756,300) (1,864,587)

Gearing ratio (169.4%) (279.4%) (945%)

41. Going Concern During the year ended 30 June 2014, the Company made a net loss of N5.34 billion (2013: N6.73 billion) and

at balance sheet date, the current liabilities exceeded its current assets by N15.30billion (2013: N6.85billion) and a deficit in shareholders’ funds of N13.75billion (2013: N8.41billion). The company continues to make losses.



Effective August 1 2015, the company entered into a managed service and collocation service agreement (MSCA) with Helios Towers Nigeria Limited (HTN). This was followed by subsequent transfer of 154 sites occupied by Airtel in August 2015, 190 sites occupied by MTN as tenants in November 2015 and another 60 sites occupied by other customers as tenants in December 2015. Under the arrangement, HTN will be responsible for the management, upgrade and provision of passive infrastructure services and other related operations and maintenance services to the tenants of the transferred sites.

Pursuant to the MSCA, on October 29, 2015 SWAP further entered into an assets purchase agreement under which HTN will completely take over all SWAP sites (currently put at 404 active sites and 295 zombie sites) and the syndicated Afrexim loan of N27.57billion. In addition, HTN will release another $25million upon acquisition of SWAP to be disbursed as follows: $22million to settle unsecured creditors and $3million as payment to existing shareholders.

Post completion of the deals with HTN, management intends to restructure SWAP Nigeria as a holding company which will basically hold investment in its subsidiary companies. This will lead to extinction of the tower assets and Collocation sales business line of SWAP Nigeria.

The financial statements are prepared on the basis of accounting policies applicable to a going concern. This basis presumes that the company will sell its tower assets to HTN, who will in turn take over the Afrexim Syndicate loan and release additional $22million to settle unsecured creditors and that realisation of assets and settlement of liabilities will occur in the ordinary course of business.



Group Company2014 2013 2014 2013

N’000 % N’000 % N’000 % N’000 %

Revenue- Local 3,450,538 5,319,146 2,936,066 4,340,917

Bought-in-materials and services:- Imported (1,363,493) (2,469,750) (1,178,631) (2,142,884)- Local (2,732,525) (4,917,609) (2,364,790) (4,300,119)

Value added from operations (645,480) (2,068,213) (607,355) (2,102,086)

-Other income 78,145 74,665 64,319 71,032

Total Value added (567,335) 100 (1,993,548) 100 (543,036) 100 (2,031,054) 100

Applied as follows:To pay employees:Salaries, wages and other benefits 253,112 (45) 305,825 (15) 94,751 (17) 122,318 (6)

To pay Government:Taxation (11,660) 2 (5,503) 0 7,068 (1) 11,336 (1)

To pay providers of capital:Finance charges 3,056,033 (539) 2,694,194 (135) 2,997,722 (553) 2,687,598 (132)

Retained for future growth and expansionDepreciation and amortization 1,727,716 (305) 1,903,650 (95) 1,693,185 (312 1,878,271 (92)Total comprehensive income (5,592,536) 987 (6,891,713) 345 (5,335,762) 983 (6,730,577) 331

(567,335) 100 (1,993,548) 100 (543,036) 100 (2,031,054) 100

Value added represents the additional wealth which the Company has been able to create by its own and its employees’ efforts. The statement shows the allocation of that wealth to employees, government, providers of finance and shareholders, and that retained for future creation of more wealth.

CONSOLIDATED STATEMENT OF VALUE ADDEDFOR THE YEAR ENDED 30 JUNE 2014


IFRS NGAAP

GROUP

30-Jun-14 30-Jun-13 30-Jun-12

18 Months period ended

June 2011

12 Months year ended December

2009N’000 N’000 N’000 N’000 N’000

ASSETS / LIABILITIESTotal non-current assets 13,797,910 15,575,183 15,201,705 19,146,011 3,315,117Total current assets 2,670,774 4,019,502 4,894,655 4,745,007 3,371,654Total Current liabilities (18,106,465) (10,746,971) (7,654,930) (5,202,804) (2,441,969)Total Non- Current liabilities (12,711,055) (17,604,014) (14,306,017) (16,749,123) (7,694)

NET ASSETS (14,348,836) (8,756,300) (1,864,507) 1,939,091 4,237,108

CAPITAL AND RESERVESShare capital 1,352,689 1,352,689 1,352,689 1,352,689 1,352,689Share premium account 2,953,228 2,953,228 2,953,228 2,953,228 2,953,228Reserves (18,654,753) (13,062,217) (6,170,504) (2,366,826) (68,809)

Total equity (14,348,836) (8,756,300) (1,864,587) 1,939,091 4,237,108

COMPANYASSETS / LIABILITIES N’000 N’000 N’000 N’000 N’000Total non-current assets 14,225,498 16,010,236 15,311,533 19,212,097 3,337,755Total current assets 2,209,985 3,305,038 4,754,123 4,557,471 3,361,996Total Current liabilities (17,509,425) (10,151,698) (7,442,424) (4,871,826) (2,418,280)Total Non- Current liabilities (12,674,155) (17,575,911) (14,304,990) (16,749,123) (7,694)

NET ASSETS (13,748,097) (8,412,335) (1,681,758) 2,148,619 4,273,777

CAPITAL AND RESERVESShare capital 1,352,689 1,352,689 1,352,689 1,352,689 1,352,689Share premium account 2,953,228 2,953,228 2,953,228 2,953,228 2,953,228Retained earnings (18,054,014) (12,718,252) (5,987,675) (2,157,298) (32,140)

Total equity (13,748,097) (8,412,335) (1,681,758) 2,148,619 4,273,777

FIVE YEAR FINANCIAL SUMMARYSTATEMENT OF FINANCIAL POSITION AS AT


PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDEDIFRS NGAAP

GROUP 30-Jun-14 30-Jun-13 30-Jun-12

18 Months period ended

June 2011

12 Months year ended December

2009N’000 N’000 N’000 N’000 N’000

Turnover 3,450,538 5,319,146 6,703,722 4,130,905 2,042,622

Loss before taxation (5,607,468) (6,891,887) (2,732,197) (2,539,111) (252,777)Taxation (11,660) 5,503 (745,837) 542,995 (1,395)

Loss after taxation (5,595,808) (6,886,384) (3,478,034) (1,996,116) (254,172)

COMPANY N’000 N’000 N’000 N’000 N’000Turnover 2,936,066 4,340,917 6,028,386 3,650,766 1,801,126

Loss before taxation (5,327,863) (6,713,561) (2,771,378) (2,374,932) (224,159)Taxation (7,068) (11,336) (745,837) 551,674 6,656

Loss after taxation (5,334,931) (6,724,897) (3,517,215) (1,823,258) (217,503)

Per Share dataGroupEarnings - Basic (kobo) (207) (255) (130) (74) (9)Net assets (530) (324) (69) 72 157

CompanyEarnings - Basic (kobo) (197) (249) (130) (67) (8)Net assets (kobo) (508) (311) (62) 79 158

Certain adjustments were effected against the IFRS balances for 2012, 2013 and 2014. The main once

include: Reclassification of intangible assets included in Property plant and equipment, Recognision of fair value gain on investment properties, Remeasurement of employee receivables and carried at amortized cost, Remeasurement of finance lease liabilities using present value, elimination of capital reserves and cummulative currency translation difference prior to 1st July 2012 (transition date) , defined benefits plan remeasurement and deferred tax liability remeasurements using temporary difference approach. If these adjustments were effected against the NGAAP balances, they will comply with IFRS

FIVE YEAR FINANCIAL SUMMARY - Continued


NOTES

Annual General Meeting of SWAP Technologies & Telecomms Plc (the “Company”) to be held on 12th day of June, 2018 at The Peninsula Hotel & Towers, Lekki-Epe Expressway, after Lekki Phase 1 Roundabout, (beside Bras Motors) Lekki, Lagos at 11 am, prompt.

I/We __________________________________________ being a member/members of Swap Technologies &

Telecomms Plc. hereby appoint ____________________________________ or failing him, the Chairman of the Meeting as my/our proxy to vote for me/us and on my/our behalf at the Annual General Meeting of the Company to be held on Tuesday the 12th of June, 2018 and at every adjournment thereof.

Dated this __________ day of _____________________, 2018. Signature: ________________________________

ORDINARY BUSINESS1. To receive the audited financial Statements for the year ended

30th June 2013 and the Chairman’s, Directors’ and auditors’ report thereon.

2. To receive the audited financial Statements for the year ended 30th June 2014 and the Chairman’s, Directors’ and auditors’ report thereon.



5. To elect/re-elect Directors.

6. To fix the remuneration of Directors.

7. To appoint Auditors to the Company

8. To authorize Directors to fix the remuneration of the Auditors.

9. To elect/re-elect members of the Audit Committee.

SPECIAL BUSINESSTo consider and if thought fit, pass the following resolution as a Special resolution:

1. The change of the Company’s name from SWAP Technologies & Telecomms Plc to SWAP Plc

RESOLUTION FOR AGAINST

A member (shareholder) who is unable to attend an Annual General Meeting is allowed by law to vote by proxy. The above proxy form has been prepared to enable you exercise your right to vote, in case you cannot personally attend the meeting.

Please sign this proxy form and forward it, so as to reach the office of the Company Secretary A.K. Nominees Management Services Limited, 1B, Otunba Adedoyin Ogunugbe Street, off Omorinre Johnson Street, Lekki Phase I, Lagos not later than Wednesday the 6th day of June, 2018. If executed by a coporation, the proxy form should be sealed with the common seal.

The proxy must produce the admission card sent with the Report and Accounts to obtain entrance to the meeting.

Please indicate with an “X” in the appropriate box how you want your vote to be cast on the resolutions set out above. Unless otherwise instructed, the proxy will vote or abstain from voting at his/her discretion.

Admission SlipPlease admit the Shareholder named on this slip or his duly appointed proxy to the Annual General Meeting of SWAP Technologies & Telecomms Plc to be held on 12th day of June, 2018 at the Peninsula Hotel & Towers, Lekki-Epe Expressway.

NAME: ____________________________________________________________________________

ADDRESS: ________________________________________________________________________

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