Page 69 - SABN AR 2021

27. Going concern
The Company remained resilient in a volatile and uncertain environment with conditions exacerbated by the COVID-19 pandemic. The SABN’s resultant approach, adoption of regulations, adjustments to the ways of working and project slowdowns did not materially affect banknote manufacturing in the financial year under review.
In the 2020/21 financial year, the SABN produced 974 million banknotes, resulting in an EBITDA of R153 million. In the 2021/22 financial year, the SABN has a budgeted production volume of 1 billion banknotes and a budgeted EBITDA of R204 million.
The 2020/21 budget included capital expenditure of R389 million compared to capital commitments authorised and contracted for to the value of R115 million. The 2021/22 budget includes capital expenditure of R382 million, which includes the roll-over of certain key projects into the 2021/22 financial year. Cash on hand is forecasted at R639 million for the next financial year in comparison to R716 million as at 31 March 2021. Cash generated from operations is forecast to increase to R305 million in the 2021/22 financial year in comparison to R204 million in the current financial year. Free cash flow for 2021/22 is estimated at negative R78 million prior to any dividend declaration or loan repayment to the SARB compared to R118 million generated in the 2020/21 financial year.
It is considered that the Company has adequate cash resources to continue operating for the foreseeable future. Management has assessed that there are no emerging risks that will have a significant impact on the business of the Company and that there is no material uncertainty that casts doubt on the entity’s ability to continue as a going concern.
28. Events after the reporting period
No adjusting or significant non-adjusting events have occurred between the 31 March 2021 reporting date and the date of authorisation of the annual financial statements.
South African Bank Note Company (RF) Proprietary Limited
Annual Report 2021
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