7664

National Flour Mills Limited
A n n u a l
R e p o r t
2 0 1 3
Table of Contents
Vision & Mission
Corporate Information
Notice of Forty-First Annual Meeting
Board of Directors
Chairmans Review
Executive Management
10
Chief Executive Officers Review
12
Financial Highlights
15
Directors Report
16
Corporate Governance
17
Independent Auditors Report
19
Statement of Financial Position
20
Statement of Comprehensive Income
21
Statement of Changes in Equity
22
Statement of Cash Flows
23
Notes to the Financial Statements
24
Management Proxy Circular
49
Proxy Form
50
National Flour Mills Limited provides services

which includes but, not limited to Flour Milling
and Packaging,
Rice Milling and Packaging,
Animal Feed Production and Packaging,
Dry Mix Blending and Packaging and Trading.
National Flour Mills Limited provides products
namely Lotus, Ibis, good N natural, Lion, National,
Hibiscus, Winners Choice and Command
Performance.
So much more than Flour!
Our Vision
We will, in partnership with our
stakeholders be the dominant
and sustainable manufacturing
enterprise, distinguished and
distinguishable by our core values
and product excellence through
constant innovation.

stands at the forefront of
Trinidad and Tobagos flour
milling and feed milling
industries.
Our Mission
To be the preferred provider of
affordable, quality food, feed
and services with excellent
returns to all stakeholders.
Annual Repo
rt 2013

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Corporate Information
Board of Directors
Mr. Mike Bazie - Chairman
Ms. Cindy Sadaphal - Deputy Chairman
Mr. Ross Alexander
Ms. Nadia Abdool
Ms. Karen Tom Yew
Ms. Aleena Ali
Ms. Lalita Ramrakha
Ms. Lynette Abraham
Mr. Khalil Mohammed
Mr. Lloyd Mungal
Chief Executive Officer
Mr. Kelvin Mahabir
Corporate Secretary
Ms. Sati Jagmohan B.Sc; ACIS; MBA; LLB
Registered Office
27-29 Wrightson Road,
Port of Spain
Telephone: (868) 625-2416/7
Fax: (868) 625-4389
Email: nfm@nfm.co.tt
Registrar and Transfer Office
Auditors
KPMG
Trinre Building
69-71 Edward Street,
Port of Spain
Principal Bankers
Scotiabank Trinidad and

Tobago Limited
Scotia Centre
Corner Park and Richmond Streets,
Port of Spain
Citibank (Trinidad and

Tobago) Limited
The Trinidad and Tobago Central

12 Queens Park East,
Depository Limited
10th Floor
Nicholas Towers,
63-65 Independence Square
Port of Spain
Telephone: (868) 625-5107-9
Fax: (868) 623-0089
Email: ttstockx@stockex.co.tt
Port of Spain
Principal Attorneys
Ashmead Ali and Company

36 Edward Street,
Port of Spain
J.D. Sellier & Company

129-131 Abercromby Street,
Port of Spain

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Notice of Forty-First Annual Meeting

NOTICE IS HEREBY GIVEN that the Forty-First Annual Meeting of National Flour Mills Limited
(NFM) will be held on 18th September, 2014, at NFMs Sports and Cultural Club located at Nos.
27-29 Wrightson Road, Port of Spain at 8.00 a.m. for the following purposes:
Ordinary Business
1. To receive and adopt the accounts for the financial year ended 31st December 2013 and the
reports of the Directors and the Auditors thereon.
2. To approve the payment of a final dividend of 5 cents per share as recommended by the
Directors.
3. To re-elect Directors.
4. To appoint Auditors and to authorize the Directors to fix their remuneration.
5. To transact such other business as may properly come before the meeting or any
adjournment thereof.
Notes
1. No Service Contracts were entered into between the Company and any of its Directors
during the period.
2. A Member of the Company entitled to attend and vote at the above Meeting is entitled to
appoint a proxy to attend and vote in his/her stead. Such proxy need not also be a member
of the Company.
3. In the event that a Member of the Company wishes to appoint a proxy to vote in his or
her stead, such Member is required to complete and sign the appropriate Proxy Form.
The signed Proxy Form should be deposited with the Secretary of the Company at the
Companys Registered Office, 27-29 Wrightson Road, Port of Spain not less than forty-eight
(48) hours before the time fixed for holding the meeting.
4. The Directors of the Company have fixed the 25th of August 2014 as the Record Date for
determining shareholders who are entitled to receive Notice of the Meeting, and have given
notice thereof by advertisement in accordance with the Companies Act.
5. Only shareholders at the close of business on 25th of August 2014 will receive Notice of the
Meeting.
BY ORDER OF THE BOARD
Sati Jagmohan
Corporate Secretary
Date: 26th of August 2014
4 I n c r e a s i n g E c o n o m i c V a l u e A d d e d t h r o u g h t h e u s e o f Te c h n o l o g y a n d I n n o v a t i o n
Although times may change.
Excellence
will always remain.

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Board of Directors
Mike Bazie
- Chairman
Cindy Sadaphal
- Deputy Chairman
Karen Tom Yew

- Director
Lloy Mungal
- Director
Ross Alexander
- Director

A n n u a l
Nadia Abdool
- Director
Lalita Ramrakha
- Director
R e p o r t
2 0 1 3
Lynette Abraham
- Director
Aleena Ali
- Director
Khalil Mohammed
- Director

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Chairmans Review
Cultivating the right culture, through overhaul

of top management and consolidation of workers
involvement in the planning and operations process
Mike Bazie
On behalf of the Board of Directors of National
Flour Mills Limited (NFM), I am pleased to
report to stockholders that the year-end 2013
performance showed a remarkable positive shift
from the recent past. It was a very profitable
year for the Company with sales of $458M,
net after-tax profits of over $18.8M and Total
Comprehensive Income of over $21M. Higher
sales revenue and lower costs of doing business
drove the expansion in profits despite an
extremely competitive and turbulent market.
It is reasonable to assume that the 2013 dividend
payout may well push investors to form expectations
about future earnings and dividends. Thus, it should
be emphasised that the 2013 impressive growth in
profit for the year over the prior year, 58%, may well
prove unsustainable were the Board not to continue
its focused drive towards renewed emphasis on
measurable efficiencies relating, in the main, to raw
materials and utilities consumption, reliable cost
accounting data, feed plant refurbishment and, also,
the institutionalisation of policies and procedures,
company-wide.
The Board holds strongly to the view that the

march towards efficiency, in all sectors, cannot be
downplayed or postponed and must be treated with a
measure of urgency, going forward.
Capital and Corporate Structure

On assuming office in August 2013, the Board,
understanding its responsibility to transform NFM
into a viable commercial entity which constantly
creates value for the customer, identified the
need for strategic change as well as the need for
organisational redesign in order to align strategy
and structure. In this respect, the Board has been
decidedly interventionist. As a consequence, specific
tasks were placed on a critical path contributing to
profitability, in the short-term, and a more marketoriented top management with the capability to drive
a culture change throughout the company. Some of
these measures included the following:

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Chairmans Review (continued)
Plant and Machinery

The year 2013 also witnessed capital expenditure
decisions on significant infrastructural upgrades
pertaining particularly to the elevator project and
rehabilitation and upgrade of production equipment.
Concluding Remarks
The above represents a snapshot of key themes as
the Board proceeded to tackle the critical issues
identified and to provide the leadership required for
the transformation of the Company. These efforts will
continue in 2014 with a view to reducing costs and
developing new markets as well as strengthening the
governance structure of the Company.
Acknowledgements
Bank debt restructuring
Rationalisation of the feed product lines and
the need to innovate in terms of products and
processes
Increased spend on feed plant equipment and
refurbishment
Joint management and union workshops leading
to the finalisation of a Strategic and Business Plan
which emphasised regional market initiatives
Activity-based cost accounting processes
Corporate restructuring
Selection of a Chief Executive Officer who has
an established track record for leadership
and enterprise turnaround, particularly in
manufacturing operations
On behalf of the Board of Directors, I wish to extend

my sincere thanks and appreciation to the Union,
Management and Staff of NFM for their efforts in
keeping the Company stable despite the many
challenges being faced. I also wish to thank our
shareholders and other stakeholders for their
support over the last year and ask for continued
support as the Company moves forward to fulfill
its mandate and increase value added for the
shareholders.
I would also like to thank personally each of my fellow
Directors for their unwavering support and dedication
to NFMs transformation. Without their support and
commitment, NFM would not have been able to rise
to the many challenges facing the Company.
Mike Bazie
Chairman

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Executive Management
Cheryl Lee Kong

- General Manager
Sales and Marketing
Kelvin Mahabir
- Chief Executive
Officer
Cheryl Edwards General Manager

Operations
Robert Subryan
- General Manager
Finance
10 I n c r e a s i n g E c o n o m i c V a l u e A d d e d t h r o u g h t h e u s e o f T e c h n o l o g y a n d I n n o v a t i o n

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So
NFM purchases quality wheat for the

manufacture of flour - no less than US #2 as
set by U.S.D.A Standards for Grain.
r
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l
F
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a
h
t
e
r
o
m
h
c
u
m
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Chief Executive Officers Review

As the incoming CEO in the latter half of 2014,
the opportunities coming out of the work started
during the fiscal year 2013 with worker and union
involvement, and the need to change the culture to
one of accountability and high performance will be
fully developed
Return on Shareholders Equity

2009
2010
2011
2012
2013
9%
9%
.3%
7%
10%
Kelvin Mahabir
The changes made by the Board and Management
in 2013 have laid the foundation for the
performance improvement targeted for 2014.
Management has committed to a new era of
enhanced customer offerings, better people
and asset productivity, and an improved plant
environment. This should drive a steadily
improving bottom line while continuing our
responsibilities as a good corporate citizen.
As the incoming CEO in the latter half of 2014,
the opportunities coming out of the work started
during the fiscal year 2013 with worker and union
involvement, and the need to change the culture to
one of accountability and high performance will be
fully developed. NFMs organisation culture has been
steeped in the mode of a monopoly organisation
creating stagnation with a consequent inability to
effectively meet the needs of a changing competitive
environment.
In 2013 the organisation was steadied as the impact of
the changes to operational practices, market strategy
and management worker relations improved.
Financial Review and Analysis

Fiscal year 2013 has been a good year for NFM with the
achievement of both by (i) a significant increase in Net
Profit after Tax over the previous year and (ii) an increase
in the earnings per share from 10 cents in 2012 to 16
cents in 2013 as well as an improvement in Shareholders
Return on Equity. This was due primarily to increased
sales and lower selling and distribution expenses.
Earnings Per Share
20
15
10
-5
2009
2010
2011
2012
Restated
2013

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CEOs Review (continued)
Finance Cost
500
The Companys cost of borrowing fell by

25% compared to 2012. This was due to
better management of liquidity as well
as the implementation of new financing
arrangements with Citibank for the purchase
of grains. The combined effect was a lower
overdraft balance and reduced interest rates .
Revenue
400
300
200
Liquidity and Financial Position
100
0
2009
2010
2011
2012
2013
Revenue
Total sales revenue for 2013 was $458M as compared to
$446M in 2012, an increase of $12M or 3%. The increase
in sales could be attributed primarily to the development
of new product lines which are gaining traction in the
marketplace.
The liquidity and financial position improved

slightly in relation to 2012 as evidenced
by the improvement in the Net Cash and
Cash Equivalents balance at the end of the
year attributable to better working capital
management. The focus has been on
providing competitive terms to our customers
with improved collections and inventory
positions.
Operations
Operating Profit
The current operations of NFM continues to

be reviewed to ensure that all products being
produced by the Company have positive profit
margins. This rationalisation process will
continue as the Company seeks to improve its
competitive position in the market.
400
350
300
250
200
150
100
50
0
2009
2010
2011
2012
Restated
2013
Operating Profit
Operating profit increased by $5.3M from $31.4M in 2012
to $36.7M in 2013 primarily due to a 24% reduction in
selling and distribution expenses and a 31% increase in
Other operating income.
NFM, understanding the importance of

satisfying the needs of customers, has
consciously made efforts to become more
customer focused by developing strategies
that enhance product quality and delivery
at reduced costs. This has entailed building
relationships with suppliers to achieve tighter
materials management and enhanced
distribution and delivery of its products. In
addition, we have commenced reviewing
mechanisms for managing receivables,
reducing wastage and returned goods as
part of our ongoing continuous improvement
initiatives.
13

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CEOs Review (continued)
Quality
Our Strategy Going Forward
NFM has already achieved the ISO and HACCP

certification. To compete on the basis of quality,
NFM must achieve Global Food Safety Certification.
The attainment of this certification is a significant
investment and will provide the trigger for
organisational change since every area of the
Companys operations will be affected. Upon
achieving the certification, there will be no quality
restrictions on entry of NFMs products into any
markets.
In going forward, NFM will be focused on increasing

the sales of its main product lines in the domestic
market as well as in the export market. The
rationalisation of product lines will be accelerated
as we seek more profitable niches. In an effort to
increase performance and to provide the shareholder
with value for money, we will continue to redesign
our manufacturing strategy to achieve lower costs
of production, efficient delivery of our products,
flexibility in operations and the attainment of the
highest quality standard in the food industry. This
will allow NFM to achieve an unparalleled reputation
in the marketplace which will be leveraged into
increased sales and greater market share.
Our People
The transformation that has started at NFM can
only be achieved with the support and commitment
of all our employees. In 2013, efforts were focused
on building a partnership with the workers and a
Memorandum of Understanding was executed
between the Company and the Seamen and
Waterfront Workers Trade Union on the issue of
productivity improvement.
The culture change to a market driven, high

performance organisation based on a committed and
accountable workforce will continue throughout 2014
and 2015.
Acknowledgements
A revitalised management team with new corporate

objectives made changes to the operations under the
guidance of the Board of Directors
The year 2013 was a challenging one for NFM. A

change of Boards in the middle of the year resulted in
the reevaluation of the operations of the Company.
Our Corporate Responsibility
Under the leadership of the new Board, it was clear

that it was not business as usual and Managers
and employees were called upon to escalate their
performance in the context of the new vision for the
Company.
As a responsible corporate citizen, NFM continues

to work with its stakeholders in the achievement of
their goals. Over the years, NFM has associated itself
with cultural events such as Mastana Bahar and
religious festivals such as Eid-ul-Fitr and Divali and
will continue to do so in the future. In addition, NFM
continues to make sundry donations of its products
to schools and deserving community groups
throughout the country.
In 2014, the Company will continue to build on the

foundation that was laid in 2013. As we continue
on this journey, I wish to take the opportunity to
express my sincere thanks and appreciation to the
Board of Directors for their unwavering support and
guidance and to the Management and Staff for their
commitment to the transformation of NFM.
Kelvin Mahabir
Chief Executive Officer

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Financial Highlights
Share Price
($ millions)
Total Assets
($ millions)
500
100
400
80
300
60
200
40
100
20
0
2009
2010
2011
2012
Restated Restated
2009
2013
Profit for the year

($ millions)
2010
2011
2012
2013
2012
2013
Issued Share Capital

($ millions)
150
20
120
15
90
10
60
5
30
0
2009
2010
2011
2009
2012
2013
Restated
2010
2011
Restated
Dividend Payment
cents per share
8
7
6
5
4
3
2
1
0
2009
2010
2011
2012
Restated
2013
15

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Directors Report
The Directors are pleased to present their report to the Shareholders for the year ended 31st December 2013.
Principal Activities
The principal activities of the Company are the production and distribution of food products and animal and
poultry feeds.
Financial Performance

$000
Turnover 457,897
Profit Before Taxation
26,673
Taxation
(7,803)
Profit for the Year
18,870
Other Comprehensive Income
Net of tax
Total Comprehensive Income for the year
Retained Earnings brought forward
Retained Earnings carried forward
2,327
21,197
26,418
37,999
Dividends
The Board of Directors recommend a dividend payment of 5 cents per share for the year ended
31st December 2013.
Directors
In accordance with Article 75 of the Companys Articles of Association, all the Directors will retire from office
at the Annual Meeting and being eligible, offer themselves for re-election.
Directors and Substantial Interests
Directors Beneficial Interests
Ross Alexander
Shareholding
20,017
Substantial Interests as defined by Section 181 (2) (a) of the Companies Act 1995
National Enterprises Limited
61,301,998
Auditors
The Auditors, KPMG will retire at the Annual Meeting, and being eligible, offer themselves for re-appointment.
By Order of the Board
Sati Jagmohan
Corporate Secretary
Registered Office
27-29 Wrightson Road
Port of Spain

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Corporate Governance
National Flour Mills Limited (NFM) is committed
to best practices and procedures in corporate
governance. Overseen by the Board of Directors,
NFMs corporate governance practices are
constantly under review, in line with the dynamics
of the environment.
The corporate governance policies adopted by the Board
of Directors (BOD) are designed to ensure that the
business of the Company is conducted in a fair, honest
and transparent manner which conforms to high ethical
standards as well as all applicable laws and regulations.
It is the responsibility of the BOD of NFM to:

Ensure the integrity of the Companys financial and
internal control policies;
Ensure the accurate, adequate and timely
submission of statutory returns and financial
reporting to the regulatory authorities and
shareholders;
Review and approve corporate policies, strategic
plan and business plan;
Monitor the implementation of policies and the
strategic direction of the Company;
Set corporate performance objectives, monitor
implementation and corporate performance;
Review and approve all major and capital
expenditure of the Company.
Make decisions regarding the capital structure of
the Company.
The Board carries out its responsibilities through Board

Committees. The Terms of Reference of the Committees
have set out their roles, responsibilities, scope of
authority and the fact that they have to report to the
Board of Directors.
Meetings of the BOD

The BOD meets on a monthly basis to make a
determination on matters reserved for the Board
(budget, financial performance, review of internal risk
management and control system, formulation of growth
strategies) and generally, directing the affairs of the
Company.
The Audit Committee

The Audit Committee is comprised of the following
Directors:
Ms. Nadia Abdool - Chairperson
Ms. Aleena Ali
Ms. Lynette Abraham
The Committee has guidelines which sets out its

responsibilities with respect to the financial statements,
internal controls, the internal audit function and the
external audit function.
The Internal Auditor

The Internal Auditor is responsible for the Companys
Internal Audit and Risk functions. The Internal Auditor
reports administratively to the Chief Executive Officer
and functionally to the Board of Directors through the
Chairman of the Audit Committee.
External Audit
The Audit Committee has reviewed the findings of
the External Auditors and their recommendations on
management matters together with management
responses. The members have expressed the opinion
that the scope and planning of the audit for the year
ended 31st December 2013 were adequate to provide the
assurance that the financial statements were free from
material misstatement and Managements responses to
the findings of the Auditor were acceptable.
17
So Much More than Flo
ur!
D e ce mbe r 31, 2 0 1 3
( Ex pr e sse d in Tr i n i d ad an d To b ago D o l l ar s )
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Independent Auditors Report

To the Shareholders of National Flour Mills Limited
Report on the Financial Statements
We have audited the accompanying financial statements of National Flour Mills Limited (the
Company), which comprise the statement of financial position as at December 31, 2013, the
statements of comprehensive income, changes in equity and cash flows for the year then ended, and
notes, comprising a summary of significant accounting policies and other explanatory information.
Managements Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements
in accordance with International Financial Reporting Standards and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
Auditors Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing. Those standards
require that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on our 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, we consider internal controls relevant to the entitys 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 entitys
internal controls. An audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of accounting estimates made by management, 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.
Opinion
In our opinion, the financial statements present fairly, in all material respects, the financial position of
the Company as at December 31, 2013, and its financial performance and cash flows for the year then
ended in accordance with International Financial Reporting Standards.
Chartered Accountants
March 25, 2014
Port of Spain
Trinidad and Tobago
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2 0 1 3
(Ex pre s s e d in Tr inid a d a nd To ba g o D o l l ar s)

Restated Restated

Notes 2013
2012
2011

$000 $000 $000
ASSETS
Current Assets
Cash and cash equivalents
7
14,994
33,037
12,162
Accounts receivable and prepayments
8
79,074
86,994
97,242
Inventories
9
87,348
77,243
69,146

181,416
197,274
178,550
Non-Current Assets
Investments 15 15 15
Retirement benefit asset
10
15,193
11,338
16,087
Property, plant and equipment
11
141,006
147,666
155,949
Trademarks
12
2,997
4,229
5,462

159,211
163,248
177,513
Total assets
340,627 360,522 356,063
LIABILITIES AND SHAREHOLDERS EQUITY
Current Liabilities
Bank overdraft
5
Accounts payable and accruals
Loans and borrowings
13
Current portion of finance lease liability
21
28,710
23,637
88,035
546
57,086
36,405
79,744
729
59,731
39,091
73,845
728

140,928 173,964 173,395
Non-Current Liabilities
Loans and borrowings
Non-current portion of finance lease liability
Deferred taxation
13
21
15
2,554
15,911
7,663
546
8,696
12,771
1,275
5,249

18,465
16,905
19,295
Total liabilities
159,393 190,869 192,690
Shareholders Equity
Stated capital
16
120,200
120,200
120,200
Capital reserve 23,035 23,035 23,035
Retained earnings
37,999
26,418
20,138

181,234
169,653
163,373
Total liabilities and shareholders equity
340,627 360,522 356,063
The accompanying notes on pages 24 to 48 form an integral part of these financial statements.
Director Director
20 I n c r e a s i n g E c o n o m i c V a l u e A d d e d t h r o u g h t h e U s e o f T e c h n o l o g y a n d I n n o v a t i o n
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Restated *

Notes 2013
2012

$000
$000
Revenue 457,897 446,263
Cost of sales
(371,848) (356,039)
Gross profit
86,049
90,224
Selling and distribution expenses

Administration expenses
Other operating income
(31,513)
(29,155)
11,324
(41,425)
(26,051)
8,622
Operating profit 36,705 31,370

Finance cost
Profit before taxation
17
(10,032)
(13,425)
26,673
17,945
Taxation 18
(7,803)
(5,997)
Profit for the year
18,870
11,948
Other comprehensive income
Items that will never be reclassified to profit or loss
Remeasurement of retirement benefit asset
Related tax
10
15
Other comprehensive income, net of tax
3,102
(775)
(4,834)
1,209
2,327
(3,625)
Total comprehensive income for the year

21,197
8,323
Earnings per share 19

16
10
* See Note 4
21

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Statement of Changes in Equity

Stated Capital Retained

Capital Reserve Earnings Total
$000 $000 $000 $000
Balance as at January 1, 2012,

as previously reported
Impact of change in accounting policy (note 4)
120,200
-
Restated balance as at January 1, 2012
120,200
Total comprehensive income (restated)

Profit for the year
Transactions with owners of the company
Dividends paid

Transactions with owners of the company
Dividends paid
Balance as at December 31, 2013
23,035
53,531
(33,393)
196,766
(33,393)
20,138
163,373
11,948
11,948
(3,625)
(3,625)
(2,043)
(2,043)
Restated balance as at December 31, 2012 120,200

Total comprehensive income
Profit for the year
23,035
-
23,035
26,418 169,653
18,870
18,870
2,327
2,327
(9,616)
(9,616)
120,200 23,035 37,999 181,234
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Statement of Cash Flows

2013 2012

$000
$000
CASH FLOWS FROM OPERATING ACTIVITIES
Adjustments for:
Depreciation
Amortisation of trademarks
Interest expense
26,673
17,945
8,717
1,232
10,032
10,147
1,232
13,425
46,654 42,749
Changes in working capital:
Accounts receivable and prepayments
7,921
10,248
Retirement benefit
(753)
(85)
Inventories
(10,105)
(8,097)
Accounts payable and accruals
(14,564)
(4,188)

Interest paid
Taxes paid
29,153 40,627
(8,236)
(11,923)
(1,365)
(1,340)
Net cash from operating activities

19,552
27,364
CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment
(1,864)
(2,056)
Net cash used in investing activities

(2,056)
(1,864)
CASH FLOWS FROM FINANCING ACTIVITIES

Repayment of loans and borrowings
Finance lease liability payments
Dividends paid
(5,110)
(728)
(2,043)
(5,109)
(729)
(9,616)
Net cash used in financing activities

(15,454)
(7,881)
Net change in cash and cash equivalents 2,042 17,619

CASH AND CASH EQUIVALENTS, BEGINNING OF THE YEAR
(98,685) (116,304)
CASH AND CASH EQUIVALENTS, END OF THE YEAR (Note 7)
(96,643)
(98,685)
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Notes to the Financial Statements
1. INCORPORATION AND PRINCIPAL ACTIVITIES

National Flour Mills Limited (the Company) is incorporated in the Republic of Trinidad and Tobago, and was
continued under the provisions of the Companies Act, 1995 on April 14, 1998. Its principal activities are the
production and distribution of food products and animal and poultry feeds.
2. BASIS OF PREPARATION
(a) Statement of compliance
These financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRSs) and were authorised for issue by the Directors on March 25, 2014.
(b) Change in accounting policy
Except for the changes below, the Company has consistently applied the accounting policies to all periods
presented in these financial statements.
(i) Fair value measurement
IFRS 13 establishes a single framework for measuring fair value and making disclosures about fair
value measurements when such measurements are required or permitted by other IFRSs. It unifies
the definition of fair value as 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. It replaces
and expands the disclosure requirements about fair value measurements in other IFRSs, including
IFRS 7.
(ii) Presentation of items of other comprehensive income (OCI)
As a result of the amendments to IAS 1, the Company has modified the presentation of items of OCI in
its statement of profit or loss and OCI, to present separately items that would be reclassified to profit
or loss from those that would never be. Comparative information has been re-presented accordingly.
(iii) Post-employment defined benefit plans
As a result of IAS 19 (2011), the Company has changed its accounting policy with respect to the basis
for determining the income or expense related to post-employment defined benefit plans (see Note 4
for further details).
(c) Basis of measurement
The financial statements have been prepared on the historical cost basis except for the following material
items in the statement of financial position:
buildings measured at historical cost or valuation less related accumulated depreciation
retirement benefit asset recognised as the plan assets less the present value of the defined benefit
obligation.
D e ce mbe r 31, 2 0 1 3
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Notes to the Financial Statements (continued)
2. BASIS OF PREPARATION (CONTINUED)

(d) Functional and presentation currency
These financial statements are presented in Trinidad and Tobago dollars, which is the Companys functional
currency. All financial information presented in Trinidad and Tobago dollars has been rounded to the
nearest thousand.
(e) Use of estimates and judgments
The preparation of the financial statements in conformity with IFRS requires the use of certain critical
accounting estimates and requires management to exercise its judgment in the process of applying the
Companys accounting policies. It also requires the use of assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements
and the reported amounts of income and expenditure during the reporting period. Actual results may
differ from these estimates.
Estimates and judgments are continually evaluated and are based on historical experience and other
factors, including expectations of future events believed to be reasonable under the circumstances.
Revisions to accounting estimates are recognised in the period in which the estimates are revised and any
future periods affected.
Information about significant areas of estimation uncertainty and critical judgments in applying accounting
policies are described in Note 5.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been applied consistently to all periods presented in these
financial statements, except for the change in accounting policy explained in Note 4.
a) Property, plant and equipment

Items of property, plant and equipment are stated at historical cost or valuation less accumulated
depreciation. Depreciation is calculated on the straight-line basis at varying rates, which are estimated
to be sufficient to write down the cost of the assets to residual value by the expiration of their useful lives.

% per annum
The rates used are as follows:
Buildings
1.25 2.5
Plant and machinery
2.0 10.0
Forklifts, trucks and loaders
25.0
Office equipment and air conditioning
10.0
Computer equipment
20.0
Motor vehicles
25.0
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De c e m be r 3 1, 2013
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

a) Property, plant and equipment (continued)
The assets residual values and useful lives are reviewed at each reporting date, and adjusted as appropriate.
An assets carrying amount is written down immediately to its recoverable amount if the assets carrying
amount is greater than its estimated recoverable amount.
Increases in the carrying amount arising on revaluation of land and buildings are credited through other
comprehensive income to capital revaluation reserve in equity. Decreases that offset previous increases of
the same asset are recognised in other comprehensive income to the extent of any credit balance existing
in the capital revaluation reserve; all other decreases are recognised in profit or loss. When re-valued
assets are sold, the amounts included in reserves are transferred to retained earnings.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and
are included in profit or loss in the statement of comprehensive income.
b) Leases
Leases of property, plant and equipment under which the Company assumes substantially all the risk and
rewards of ownership are classified as finance leases. Assets held under finance leases are capitalised at
the lower of the fair value of the leased assets and the present value of the minimum lease payments, at
the date of inception of the lease. The corresponding leasing commitments, net of finance charges, are
included in liabilities. The interest element of the lease payments is charged to profit or loss over the lease
period.
Depreciation on assets held under finance leases is charged to profit or loss over the shorter of the lease
term and their estimated useful lives.
Leases in which a significant proportion of the risks and rewards of ownership are retained by the lessor
are classified as operating leases. Rentals paid under operating leases are charged to appropriate expense
headings in the statement of comprehensive income on a straight line basis over the period of the lease.
c) Trademarks
Trademarks are stated at cost less accumulated amortisation. Amortisation is recognised on a straightline basis over the estimated useful life of the trademarks, which range from 10 - 14 years.
d) Financial instruments
Financial instruments are contracts that give rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.
Financial assets and liabilities are offset and the net amount presented in the statement of financial position
when, and only when, the Company has a legal right to offset the amounts and intends either to settle on a
net basis or to realise the asset and settle the liability simultaneously.
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d) Financial instruments (continued)
Financial assets
The Companys financial assets comprise of cash and cash equivalents, trade and other receivables and
available-for-sale investments.
The Company recognises loans and receivables and deposits on the date that they are originated. All other
financial assets are recognised on the trade date at which the Company becomes a party to the contractual
provisions of the instrument.
Financial assets are derecognised when the contractual rights to receive the cash flows from the asset
expire, or where substantially all the risks and rewards of ownership of the financial asset have been
transferred.
Trade and other receivables
Trade receivables are measured at cost. Subsequent to initial recognition such receivables are measured
at estimated recoverable amount. An allowance for irrecoverable amounts is made, and charged to the
statement of comprehensive income, whenever there is objective evidence that a receivable is impaired.
Available-for-sale investments
These investments are intended to be held for an indefinite period of time but may be sold in response to
the needs for liquidity or changes in interest rates, exchange rates or equity prices. These are unquoted
securities that are measured at cost.
Financial liabilities
The Companys financial liabilities comprise loans and borrowings, bank overdrafts and trade and other
payables.
When financial liabilities are recognised initially, they are measured at fair value plus directly attributable
transaction costs. Financial liabilities are subsequently re-measured at amortised cost using the effective
interest method.
Financial liabilities are derecognised when they are extinguished that is when the obligation specified in
the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial
liability extinguished and the consideration paid is recognised in the statement of comprehensive income.
Bank loans
Bank loans are recognised initially at fair value, net of transaction costs incurred. Bank loans are
subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs)
and the redemption value is recognised in the statement of comprehensive income over the period of the
loan using the effective interest method.
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d) Financial instruments (continued)
Share capital
Ordinary shares are classified as equity and stated at the amounts subscribed by shareholders, less any
incremental costs directly attributable to the issue of the shares (net of tax).
e) Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits with original maturities of three
months or less. Bank overdrafts that are repayable on demand and short-term commodity import loans,
which form an integral part of the Companys cash management, are included as a component of cash and
cash equivalents for the purposes of the statement of cash flows.
f) Inventories
Inventories are measured at the lower of cost (on a first in first out basis) and net realisable value. Cost
includes expenditure incurred in acquiring the inventories, production costs and other costs incurred
in bringing them to their present location and condition. Included in the cost of finished goods is an
appropriate share of production overheads based on normal operating capacity.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated
costs of completion and selling expenses.
g) Taxation
Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised
in the statement of comprehensive income except to the extent that the tax relates to items recognised
directly in equity or in other comprehensive income.
Current tax
Current income tax is the expected tax payable or receivable on the taxable income or loss for the year,
using tax rates enacted or substantively enacted at the reporting date, plus any adjustments to tax payable
in respect of previous years.
Deferred tax
Deferred income tax is provided, using the liability method, on all temporary differences at the reporting
date between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
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g) Taxation (continued)
Deferred tax (continued)
Deferred tax assets are recognised for all deductible temporary differences, and the carry-forward of
unused tax losses, to the extent that it is probable that taxable profits will be available against which they
can be utilised. Deferred tax assets are reviewed at each reporting date and are 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.
h) Retirement benefit plan

The Company operates a defined benefit pension plan covering its permanent employees. The funds of
the Plan are administered by Trustees.
The Companys net obligation in respect of the retirement benefit plan is calculated by estimating the
amount of future benefit and that employees have earned in the current and prior periods, discounting that
amount and deducting the fair value of the plan assets. The calculation of the defined benefit obligation
is performed annually by a qualified independent actuary using the projected unit credit method. When
the calculation results in a potential asset for the Company, the recognised asset is limited to the present
value of economic benefits available in the form of any future refunds of the Plan or reductions in future
contributions to the Plan (after considering any minimum funding requirements).
Remeasurements of the net defined benefit asset, which comprise actuarial gains and losses, the return
on plan assets (excluding interest) and the effect of the asset ceiling (if any), are recognised immediately
in other comprehensive income.
Net interest expense (income) on the net defined benefit liability (asset) is determined using the discount
rate. Net interest expense and other expenses related to the retirement benefit plan are recognised in
profit or loss.
The actuary performs a full actuarial valuation every three years and any surpluses or deficits may be
recognised by an adjustment of future contribution rates.
i) Foreign currency
Monetary assets and liabilities denominated in foreign currencies are expressed in Trinidad and Tobago
dollars at rates of exchange ruling at the reporting date. All revenue and expenditure transactions
denominated in foreign currencies are translated at the exchange rates ruling at the date of the transactions.
The resulting profits and losses on exchange from these trading activities are recorded in profit or loss.
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j) Provisions
Provisions are recognised when the Company has a present legal or constructive obligation as a result of
past events, it is more likely than not that an outflow of resources will be required to settle the obligation,
and the amount can be estimated reliably.
The amount recognised as a provision is the best estimate of the consideration required to settle the
present obligation at the reporting date, taking into account the risks and uncertainties surrounding the
obligation. Where a provision is measured using the cash flows estimated to settle the present obligation,
its carrying amount is the present value of those cash flows.
k) Revenue recognition
Revenue from the sale of goods is measured at sale price, net of returns, trade discounts and volume
rebates. Revenue is recognised upon delivery of goods to customers.
l) Earnings per share

Earnings per share is calculated by dividing the profit or loss attributable to ordinary shareholders of the
Company by the weighted average number of ordinary shares outstanding during the year.
m) Segment reporting
Segment reporting is prepared based on the different categories of products sold by the Company.
n) New standards and interpretations not yet adopted

A number of new standards, amendments to standards and interpretations are not yet effective for the
period ended December 31, 2013, and have not been applied in preparing these financial statements.
Those which may be relevant to the Company are set out below. The Company does not plan to adopt
these standards early.
IFRS 9 Financial Instruments (2009 & 2010) IFRS 9 (2009) introduces new requirements for the
classification and measurement of financial assets, whilst IFRS 9 (2010) introduces additional changes
relating to financial liabilities. The IASB has been working on an active project to make limited amendments
to IFRS 9 and add new requirements on impairment and hedge accounting. The final version of IFRS 9 is
not expected to become effective for the Company before 2018, and the Company is assessing the impact
the standard may have on its financial statements.
D e ce mbe r 31, 2 0 1 3
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4. PRIOR YEAR RESTATEMENTS


January 1, 2012
Deferred taxation
Retained earnings
December 31, 2012
Deferred taxation
Retained earnings

December 31, 2012
Cost of sales
Taxation
Profit for the year
As previously
Exchange
As
Reported
IAS 19
Loss
Restated
$000 $000 $000 $000
60,611
(16,380)
(53,531)
(44,524)
11,131
33,393
59,884
35,047
(20,834)
(64,836)
(48,546)
-
12,138
36,206
16,087
(5,249)
(20,138)
-
(2,010)
-
2,010
11,338
33,037
(8,696)
(28,630)
As previously
Exchange
As
Reported
IAS 19
Loss
Restated
$000 $000 $000 $000
(356,851)
(24,041)
(5,795)
13,348
812
-
(202)
610
-
(2,010)
-
(2,010)
(356,039)
(26,051)
(5,997)
11,948
Under its previous policy, as allowed under the earlier version of IAS 19, the Company had utilised the corridor
approach to the recognition of periodic actuarial gains and losses. It now recognises all actuarial gains or
losses through other comprehensive income. The net annual interest expense or income is now determined
by applying the discount rate to the net retirement benefits obligation or asset and not through the use of an
expected rate of return to the plan assets, as was allowed under the previous IAS 19. In accordance with IAS 8,
this change of accounting policy in respect of the application of IAS 19 (2011) has been applied retrospectively
through the restatement of retained earning as at January 1, 2012 and the Statement of Comprehensive
Income for 2012
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4. PRIOR YEAR RESTATEMENTS (CONTINUED)

uring the year, Management identified an error in misstatement in the statement of comprehensive income
D
for 2012 that resulted from the omission of recording an exchange loss on a foreign currency bank account. In
accordance with IAS 8, Management has decided to restate the statement of comprehensive income for 2012
in order to correct the omission. The decision was taken to restate the financial statements in the prior year.
5. FINANCIAL RISK MANAGEMENT
Financial risk factors
The Company has exposure to the following risks from its use of financial instruments:

credit risk
liquidity risk
currency risk
interest rate risk.
This note presents information about the Companys exposure to each of the above risks, and its framework
for managing these risks. Further quantitative disclosures are included in relevant notes throughout these
financial statements.
The Board of Directors has ultimate responsibility for the establishment and oversight of the Companys risk
management framework. The Audit Committee oversees compliance with the Companys risk management
framework and is assisted in its oversight role by the Internal Audit Department.
The Companys main financial risks relate to the availability of funds to meet business needs, the risk of delayed
or non-payment by the Companys customers, and fluctuations in foreign exchange and interest rates. The risk
management policies employed by the Company to manage these risks are discussed below:
a) Credit risk
The Company is exposed to credit risk, which is the potential for loss due to a debtors failure to pay
amounts when due. The Company manages this by regular analysis of the ability of debtors to settle their
outstanding balances. Impairment provisions are established for losses or potential losses that have been
incurred at the reporting date.
The Company only trades with credit worthy third parties who are subject to credit verification procedures,
which take into account their financial position and past experience. Individual risk limits are set based on
internal ratings.
Credit risk on cash and cash equivalents held by the Company are minimised as all cash deposits are held
with banks which have acceptable credit ratings.
D e ce mbe r 31, 2 0 1 3
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5. FINANCIAL RISK MANAGEMENT (CONTINUED)

Financial risk factors (continued)
b) Liquidity risk
Liquidity risk is the risk that the Company will face difficulty in meeting its obligations under financial
liabilities as they fall due.
The Company manages its liquidity risk by monitoring its projected inflows and outflows from operations.
Where possible the Company utilises surplus internal funds to finance its operations. The Company also
utilises available credit facilities such as loans and overdrafts.
c) Currency risk
Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign
exchange rates. Currency risk arises when future commercial transactions and recognised assets and
liabilities are denominated in a currency that is not the Companys measurement currency. The Company
is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to
the United States Dollar. The Companys management monitors the exchange rate fluctuations on a
continuous basis and employs appropriate strategies to mitigate any potential losses.
d) 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.
With the exception of bank overdrafts, the Company has no significant variable rate interest bearing
assets or liabilities. As a consequence, the Companys income and operating cash flows are substantially
independent of changes in market interest rates.
Operational risk
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the
Companys processes, personnel, technology and infrastructure, and from external factors such as those
arising from legal and regulatory requirements and generally accepted standards of corporate behaviour.
Compliance risk
Compliance risk is the risk of financial loss, including fines and other penalties, which arise from noncompliance with laws and regulations of the state. The risk is limited to a significant extent due to the
supervision applied by the Securities and Exchange Commission of Trinidad and Tobago, as well as by
the monitoring controls applied by the Company. The Company has an Internal Audit Department which
performs routine reviews on compliance.
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5. FINANCIAL RISK MANAGEMENT (CONTINUED)

Financial risk factors (continued)
d) Interest rate risk (continued)
Reputation risk
The risk of loss of reputation arising from the negative publicity relating to the Companys operations
(whether true or false) may result in a reduction of its clientele, reduction in revenue and legal cases against
the Company. The Company engages in public social endeavours to engender trust and minimise this risk.
6. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
The critical accounting judgments and estimations, which have the most significant effect on the amounts
recognised in the financial statements, are as follows:

Retirement benefit obligations
The Company has determined that, in accordance with the terms and conditions of the defined benefit plan,
and in accordance with statutory requirements (such as minimum funding requirements) of the plan, the
present value of refunds or reductions in future contributions is not lower than the balance of the total fair value
of the plan assets less the total present value of obligations. As such, no decrease in the defined benefit asset
is necessary at December 31, 2013.
Principal actuarial assumptions are set out in Note 10.
Impairment of trade receivables
The Company establishes an allowance for impairment that represents its estimate of projected losses in
respect of trade and other receivables. The main components of this allowance are a specific loss component
that relates to individually significant exposures. The loss allowance is determined based on current data of
payment statistics for specific circumstances relating to specific transactions.
Impairment of tangible and intangible assets and useful lives
At each reporting date, management reviews the carrying amounts of the Companys tangible and intangible
assets to determine whether there is any indication of impairments. An asset is impaired when the carrying
value is greater than its recoverable amount and there is objective evidence of impairment. Recoverable
amount is determined based on the value-in-use method, which is the present value of the estimated future
cash flows over the estimated useful life of the asset discounted using market rates.
Management exercises judgement in determining whether future economic benefits can be derived from
expenditures to be capitalised and in estimating the useful lives and residual values of these assets.
Deferred tax
The Company assesses the impact of estimated tax losses, which is subject to final approval by the Board of
Inland Revenue, on deferred tax liability. Any final assessment done by the Board will be incorporated in the
year that this assessment is completed and agreed by the Company.
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7. CASH AND CASH EQUIVALENTS

2013 2012
$000 $000
Cash in hand and at bank

Short-term deposits
14,756
238
31,990
1,047
Cash and cash equivalents in the statement of financial position
14,994
33,037
Short-term cash management facilities:

Bank overdrafts
Revolving grain purchase loans
(28,711)
(82,926)
(57,086)
(74,636)
(111,637) (131,722)
Cash and cash equivalents in the statement of cash flows
(96,643)
(98,685)
Bank overdraft facilities are provided by Scotiabank Trinidad and Tobago Limited and Citibank (Trinidad &
Tobago) Limited. These facilities are secured by a debenture and collateral mortgage, stamped to cover TT$90
million each, comprising of a fixed charge over goodwill, land and buildings located at Wrightson Road, Portof-Spain and a floating charge over all other assets of the Company. This security ranks pari passu with the
security for the loans from First Citizens Bank Limited (see Note 13). An assignment of industrial all risks
insurance with coverage of US$57.7 million has also been executed in favour of the banks.
Revolving grain purchase loans have been provided by the following to finance the importation of grain (See
Note 13):

Export Import Bank of Trinidad & Tobago (Eximbank) Ltd

Gavilon LLC
Citibank (Trinidad and Tobago) Limited
2013 2012
US$000 US$000
5,893
3,284
3,780
2,676
2,986
6,000
12,957
11,662
$000 $000
TTD equivalent
82,926
74,636
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8. ACCOUNTS RECEIVABLE AND PREPAYMENTS

2013 2012
$000 $000
Trade receivables
Prepayments
Sundry receivables
67,386
65,838
2,663 7,137
9,025
14,019
79,074
86,944
Included in accounts receivable and prepayments is $3.6 million due from the Government of the Republic of
Trinidad and Tobago (GORTT). This amount is as a result of the Company offering discounts to customers to
pass on to the public on specific products in December 2013 at the request of the GORTT.
The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivable
mentioned above. The credit risk exposure for trade receivables at the reporting date by type of counterparty
was:

2013 2012

$000 $000
Wholesalers
Industrial
Export
Feed
Retailers
Other
14,070 16,041
12,569 13,154
3,989 4,520
12,181 11,819
17,656 18,150
6,921
2,154
67,386
65,838
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8. ACCOUNTS RECEIVABLE AND PREPAYMENTS (CONTINUED)

The aging analysis of trade receivables at the reporting date was:

Gross
2013
$000
Impairment
2013
$000
Not past due

Past due:
1-2 months
2-3 months
3-6 months
over 6 months
38,616
16,977
-
16,711
5,261
-
5,276
2,955
-
3,554
24,706 21,129 26,241 20,352
88,515 21,129 86,190 20,352
Gross
2012
$000
34,408
Impairment
2012
$000
-
The movement in the impairment allowance during the year was as follows:

2013 2012
$000 $000
Balance at January 1
Allowance charged to profit for the year
20,352
777
14,920
5,432
Balance at December 31
21,129
20,352
9. INVENTORIES

Raw materials
Packaging materials
Finished products
Maintenance spares

2013 2012
$000 $000
61,919
3,791
8,788
12,850
87,348
55,505
3,676
8,268
9,794
77,243
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10. RETIREMENT BENEFIT ASSET

Restated

2013 2012

$000 $000
Present value of defined benefit obligation
Fair value of Plan assets
Recognised asset for defined benefit obligation

a) Change in defined benefit obligations
Defined benefit obligation at start of year
Benefits paid
Current service cost
Interest cost
Members contributions
Remeasurements:
- experience adjustments
- actuarial losses from changes in financial assumptions
Defined benefit obligation at end of year
(150,182)
165,375
(139,207)
150,545
15,193
(139,207)
3,926
(5,065)
(6,863)
(1,842)
(1,131)
-
11,338
(121,533)
5,660
(4,447)
(6,531)
(1,344)
(797)
(10,215)
(150,182) (139,207)
b) The defined benefit obligation is allocated between the Plans members as follows:
- Active
- Deferred members
- Pensioners
56%
18%
26%
The weighted average duration of the defined benefit obligation at the year end 15.8 years.
96% of the value of the benefits for active members is vested.
32% of the defined benefit obligation for active members is conditional on future salary increases.
D e ce mbe r 31, 2 0 1 3
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10. RETIREMENT BENEFIT ASSET (CONTINUED)

Restated

2013 2012

$000 $000
c) Change in plan assets
Plan assets at start of year
150,545
137,620
Company contributions
5,430
3,843
Members contributions
1,842
1,344
Benefits paid
(3,926)
(5,660)
Interest Income
7,601
7,547
Return on plan assets
4,233
6,178
Expense allowance
(350)
(327)
Plan assets at end of year
Actual return on Plan assets
d) Asset allocation
Locally listed equities
Overseas equities
TT$-denominated bonds
Non-TT$-denominated bonds (mainly US$)
Mutual funds (short-term securities)
Other (immediate annuity policies)
Fair value of Plan assets at end of year
165,375
150,545
11,834
13,725
42,865
10,235
76,792
14,330
1,679
7,171
12,303
29,940
8,425
59,918
14,589
6,884
18,299
12,490
165,375
150,545
The Plan does not directly hold any assets of the Company.
Restated

2013 2012

$000 $000
e) Expense recognised in profit or loss
Current service costs
5,065
4,447
Interest on defined benefit obligation
(738)
(1,016)
350
327
Net pension cost
f) Re-measurements recognised in other comprehensive income
Experience (gains) losses
4,677
3,758
(3,102)
4,834
39

A n n u a l
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De c e m be r 3 1, 2013
10. RETIREMENT BENEFIT ASSET (CONTINUED)

Restated

2013 2012

$000 $000
g) Reconciliation of opening and closing statement of
financial position entries
Opening defined benefit asset
Net pension cost
Re-measurements recognised in other comprehensive income
Company contributions paid
Closing defined benefit asset
11,338
(4,677)
3,102
5,430
16,087
(3,758)
(4,834)
3,843
15,193
11,338
2013
2012
5.00%
4.75%
0.00%
5.00%
4.75%
0.00%
h) The Company expects to contribute $4.503 million

to its defined benefit pension plan in 2014.
i) Summary of principal assumptions

Discount rate at December 31
Future salary increases
Future pension increases
D e ce mbe r 31, 2 0 1 3
A n n u a l
R e p o r t
2 0 1 3
11. PROPERTY, PLANT AND EQUIPMENT

Plant

Industrial
Machinery

and Office
and

Buildings
Equipment

Year ended December 31, 2013
Office Furniture,
Equipment and
Motor Vehicles
Total
$000 $000 $000 $000
Cost/Valuation
At January 1, 2013
Additions
160,227
122
At December 31, 2013
160,349 328,330
326,884
1,446
28,942
488
516,053
2,056
29,430 518,109
Accumulated depreciation
At January 1, 2013
Charge for the year
48,469
1,651
292,524
5,821
27,394
1,245
368,387
8,717
50,119
298,345
28,639
377,104
Cost/Valuation
At January 1, 2012
Additions
159,678
549
326,440
444
28,071
871
514,189
1,864
160,227 326,884
Year ended December 31, 2012
28,942 516,053
Accumulated depreciation
At January 1, 2012
Charge for the year
47,378
1,091
285,006
7,518
25,856
1,538
358,240
10,147
48,469
292,524
27,394
368,387
Net book value

110,230 29,985
111,758
34,360
791 141,006
1,548
147,666
The property, plant and equipment are subject to a registered debenture to secure bank borrowings (see
Note 12).
41

A n n u a l
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De c e m be r 3 1, 2013
11. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

If buildings and plant and machinery were stated at historical cost, the carrying amounts would be as follows:

2013 2012
$000 $000
Industrial and office buildings

Plant and machinery
100,343
29,977
106,659
34,361
130,320
141,020
17,312
17,312
Accumulated amortisation
Beginning of year
Charge for the year
13,083
1,232
11,851
1,232
End of year
14,315
13,083
Net book value
2,997
4,229
12. TRADEMARKS
Cost
End of year
13. LOANS AND BORROWINGS

Interest
Maturity
2013
2012
Rate Date $000 $000
First Citizens Bank Limited

Tranche B
6.18%
January 2015
Other secured advances (see Note 7)
Total loans and borrowings
Less current portion
Non-current portion
7,663
82,926
12,771
74,636
90,589
87,407
(88,035) (79,744)
2,554
7,663
The First Citizens Bank Limited loan is secured by a debenture and collateral mortgage, stamped to cover $90
million ranking pari passu with the security for the bank overdraft facilities (see Note 7). It is repayable in semiannual instalments ending in January 2015.
D e ce mbe r 31, 2 0 1 3
A n n u a l
R e p o r t
2 0 1 3
14. MATURITY OF FINANCIAL LIABILITIES

The following are the contractual maturities of financial liabilities, including estimated interest payments:

Carrying Contractual 6 Months

Amount Cash Flows
or Less
6-12
Months
1-2
Years
2-5
Years
$000
$000
$000 $000 $000 $000
7,663
82,927
546
23,887
28,710
8,138
83,685
597
23,887
28,710
2,793
83,685
400
23,887
28,710
2,711
197
-
145,017
139,475
2,908
12,771
74,636
1,275
36,655
57,086
13,957
75,268
1,405
36,655
57,086
2,952
75,268
400
36,655
57,086
2,867
400
-
184,371
172,361
3,267
December 31, 2013

Secured bank loans
Other secured advances
Finance lease liability
Trade and other payables
Bank overdraft
2,634
-
2,634
-
-
December 31, 2012

Secured bank loans
Other secured advances
Finance lease liability
Trade and other payables
Bank overdraft
8,138
605
8,743
43

A n n u a l
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De c e m be r 3 1, 2013
15. DEFERRED TAXATION

Movement in deferred income tax liability:
2013 2012
$000 $000
Balance at beginning of year

Charge to the income statement
Recognition in other comprehensive income
8,696
6,440
775
5,249
4,656
(1,209)
Balance at end of year
15,911
8,696
(17,890)
(24,705)
30,001
775
3,025
30,631
(63)
(1,209)
4,042
Deferred taxation is attributable to the following items:

Tax losses carried forward
Excess of net book value of property, plant and equipment
over tax written-down value
General provision for bad debts
Remeasurement of retirement benefit asset

15,911
8,696
120,200
120,200
16. STATED CAPITAL

Authorised
Unlimited number of ordinary shares of no par value
Issued and fully paid
120,200,000 ordinary shares of no par value
17. PROFIT BEFORE TAXATION

Profit before taxation is arrived at after charging:
2013 2012
$000 $000
Salaries and wages

57,932
60,549
Bank interest and charges
10,013
11,743
Depreciation current year
8,717
10,147
Amortisation of trademarks
1,232
1,232
Operating lease rentals
1,005
1,150
Directors fees
707
558

The average number of persons employed by the Company during the year was 355 (2012: 356).
D e ce mbe r 31, 2 0 1 3
A n n u a l
R e p o r t
2 0 1 3
18. TAXATION

Deferred tax (see Note 15)
Business levy
Green Fund levy

2013 2012
$000 $000
6,438
4,656
910
894
455
447
7,803
5,997
26,673
17,945
The Companys effective tax rate of 33% (2012: 30%) differs

from the statutory tax rate of 25% as follows:
Tax calculated at 25%
Non-taxable income
Green Fund levy
Business levy
Expenses not deductible for tax purposes
Deferred tax prior year over provision
6,668
(187)
455
910
167
(210)
4,486
(187)
447
894
669
(312)
7,803
5,997
The Company was audited by the Board of Inland Revenue for 2005 Corporation Tax. Based on the assessment
it was indicated that an adjustment to reduce the tax losses by $16 million was required. The Company has
filed an appeal against this assessment. According to the Companys tax computation, the Company has tax
losses of approximately $72 million available to be carry forward against future taxable profits.
19. EARNINGS PER SHARE

arnings per share is calculated by dividing the profit attributable to ordinary shareholders of $18,870 thousand
E
(2012: $11,948 thousand) by the weighted average number of ordinary shares outstanding of 120,200,000
(2012: 120,200,000).
Only basic earnings per share are presented as there are no potentially dilutive share options in issue.
45

A n n u a l
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De c e m be r 3 1, 2013
20. RELATED PARTY TRANSACTIONS

A number of transactions are entered into with related parties in the normal course of business. These
transactions were carried out on commercial terms at market rates.
a) B
alances and transaction with key management personnel during the year were as follows:

Key management compensation
Short-term benefits
Post employment benefits

2013 2012
$000 $000
4,067
467
3,934
448
4,534
4,382
b) National Flour Mills Limited (NFM) has an agreement with the Ministry of Food Production, Land and Marine
Resources which allows for NFM to purchase all rice paddy from local rice farmers. The amount paid is
reimbursable by the Ministry to NFM. This amount as well as the proceeds for the sale of the processed rice
(which is reimbursable by NFM to the Ministry) is recorded in a Consolidated Account.
The following amounts are included in sundry receivables and accounts payable:

Amount due to NFM
Balance on Consolidated fund
Balance outstanding
As at 31 December
2013 2012
$000 $000
10,434
9,404
4,332
9,250
D e ce mbe r 31, 2 0 1 3
A n n u a l
R e p o r t
2 0 1 3
21. FINANCE AND OPERATING LEASE COMMITMENTS

During 2010, the Company entered into a finance lease agreement to acquire an automatic silo scale with a
lease term of four years. The Company has the option to purchase the equipment for a nominal amount at the
conclusion of the lease agreement.
Finance leases liabilities are payable as follows:

Future Minimum

Lease Payments
Interest

2013
2012
2013
2012

$000
$000
Less than one year

Between one and five years
597
-
801
597
597
1,398
Present Value
Future Minimum
Lease Payments
2013
2012
$000 $000 $000 $000

51
-
72
51
51
123
546
-
546
729
546
1,275
Minimum lease payments under non-cancellable operating leases are as follows:

Less than one year
Between one and five years
2013 2012
$000 $000
1,064
1,660
362
450
22. CONTINGENT LIABILITIES

As at December 31, 2013, the Company had contingent liabilities in respect of pending litigation.
Based on legal advice, the Directors believe that the Company will be successful in these actions. However,
if defence against the action(s) is unsuccessful, the potential liability for damages and costs amounts to
approximately $330 thousand (2012: $NIL).
47

A n n u a l
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De c e m be r 3 1, 2013
2 0 1 3
23. OPERATING SEGMENTS

The Company has two reportable segments, as described below, which are the Companys strategic divisions.
The strategic divisions offer different products and services, and are managed separately because they
require different technology and marketing strategies. For each of the strategic divisions, the Companys Chief
Executive Officer (CEO) reviews internal management reports monthly. The following summary describes the
operations in each of the Companys reportable segments:
Foodstuff. Includes manufacturing and distributing flour, flour by products and rice.
Animal feed. Includes manufacturing and distribution of feed products for animals
Other operations include the purchase and sale of imported dry goods, and grain.
Information regarding the results of each reportable segment is included below. Performance is measured based
on segment gross profit, as included in the internal management reports that are reviewed by the Companys
CEO. Segment profit is used to measure performance as management believes that such information is the
most relevant in evaluating the results of certain segments relative to other entities that operate within these
industries.
Financial information regarding assets and liabilities by operating segment is not reported on a regular basis
to the Companys CEO.

External revenue
Depreciation
and amortisation
Gross profit
Food stuff
Animal Feeds
Other
Total
2013 2012 2013 2012 2013 2012 2013 2012
$000 $000 $000 $000 $000 $000 $000 $000
312,224 312,423
118,178
103,068
27,496 30,772
457,897 446,263
7,310
7,261
2,086
3,305
552
813
9,949
11,379
59,496
66,268
26,056
18,368
497
5,588
86,049
90,224
D e ce mbe r 31, 2 0 1 3
A n n u a l
R e p o r t
2 0 1 3
Management Proxy Circular

Republic of Trinidad and Tobago
The Companies Act, 1995
(Section 144)
1. Name of Company
2. NATIONAL FLOUR MILLS LIMITED: Company No. N-763 (95)(A)
3. Particulars of Meeting Forty-First Annual General Meeting of the shareholders of the

Company to be held at the Sports Club, National Flour Mills Limited, 27-29 Wrightson Road, Port
of Spain on Thursday 18th September 2014 at 8.00 a.m.
4. Solicitation It is intended to vote the Proxy hereby solicited by the Management of the
Company (unless the shareholder directs otherwise) in favour of all resolutions specified in the
Proxy Form.
5. Any Directors statement submitted pursuant to Section 76(2) No statement has been
received from any Director pursuant to Section 76(2) of the Companys Act, 1995.
6. Any Auditors statement submitted pursuant to Section 171(1) No statement has been
received from the Auditors of the Company pursuant to section 171 (1) of the Companys Act
1995.
7. Any Shareholders proposal and/or statement submitted pursuant to Sections 116(1)

and 117(2) No proposals have been received from any shareholder pursuant to Sections 116(1)
and 117(2) of the Companies Act, 1995.
Date
Name and Title
Signature
Sati Jagmohan
26th August 2014
Secretary
49

A n n u a l
R e p o r t
De c e m be r 3 1, 2013
2 0 1 3
Proxy Form
REPUBLIC OF TRINIDAD AND TOBAGO
THE COMPANIES ACT 1995
(Section 143(1)
Form of Proxy
Name of Company
NATIONAL FLOUR MILLS LIMITED
Company No. N-763 (95) (A)
Particulars of Meeting
Forty-First Annual General Meeting of the shareholders of the Company to be held at the Sports Club,
National Flour Mills Limited, 27-29 Wrightson Road, Port of Spain on Thursday 18th September 2014 at 8.00
a.m.
I/We..
of
being a member/members of National Flour Mills Limited (the Company), hereby appoint the Chairman
of the Meeting or failing him.of
. in the same manner, to the same extent and with the same
powers as if I/We was/were present at the said Meeting or such adjournment thereof, and in respect of the
resolutions listed below to vote in accordance with my/our instructions below and overleaf.
Dated this.day of..,2014.
..
Signature(s) of Shareholder(s)
Please indicate with an X in the space below and overleaf your instructions on how you wish your vote on
the resolution referred to be cast. Unless otherwise instructed, the proxy may vote or abstain from voting
as he/she thinks fit. Please consider the notes 1 to 5 overleaf for your assistance to complete and deposit
this Proxy Form.
D e ce mbe r 31, 2 0 1 3
A n n u a l
R e p o r t
2 0 1 3
Proxy Form (continued)

No. Ordinary Resolution
1.
3.
4.
Against
To elect Directors and for such purpose pass the following resolutions:
Be it resolved that the Directors to be re-elected namely Mike Bazie,
Cindy Sadaphal, Ross Alexander, Lalita Ramrakha, Karen Tom Yew,
Khalil Mohammed, Lynette Abraham, Aleena Ali and Lloyd Mungal,
be re-elected en bloc
For
Be it resolved that the Financial Statements for the Company for the year
ended 31st December 2013 and the reports of the Directors and Auditors
thereon be adopted.
Be it resolved that a final dividend for the year ended 31st December 2013
of 5 cents per ordinary stock unit as recommended by the Directors be
declared payable on the 10th October 2014 to shareholders on the Register
at the close of business on 25th August 2014.
Be it resolved that KPMG be appointed Auditors of the Company for the
period ending at the close of the next Annual Meeting and that the Directors
be authorized to fix their remuneration and expenses for the ensuing year.
Notes:
1. A Shareholder may appoint a proxy of his/her own choice. If such an appointment is made, delete the
words the Chairman of the Meeting from the Proxy Form and insert the name and address of the person
appointed proxy in the space provided and initial the alteration.
2. If the appointee is a Corporation, this Proxy Form must be under common seal or under the hand of an
officer or an attorney duly authorized in that behalf.
3. A Shareholder who is a body corporate may, in lieu of appointing a proxy, authorize an individual by
resolution of its directors or governing body to represent it at this Annual General Meeting.
4. In the case of joint Shareholders, the name of all joint shareholders must be stated on the Proxy Form and
all joint shareholders must sign the Proxy Form.
5. To be valid, the Proxy Form must be completed and deposited at the Registered Office of the Company at
the address below not less than forty-eight (48) hours before the time fixed for holding the Annual General
Meeting or adjourned meeting.
Return to:
The Secretary
Port of Spain
51

A n n u a l
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De c e m be r 3 1, 2013
Notes
Design and Layout: Paria Publishing Co. Ltd.

Photographer: Michael Bonaparte
Other Photographs: Paria Publishing archive,
shutterstock and dreamstime
Printing: Caribbean Printing Technologies Ltd.
National Flour
Mills Limited
Registered Office
Port of Spain
Telephone: (868) 625-2416/7
Fax: (868) 625-4389
Email: nfm@nfm.co.tt

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National Flour Mills Limited

Notice of Forty-First Annual Meeting

Chief Executive Officers Review

Independent Auditors Report

Statement of Financial Position

Statement of Comprehensive Income

Statement of Changes in Equity

Statement of Cash Flows

Notes to the Financial Statements

Management Proxy Circular

National Flour Mills Limited provides services

So much more than Flour!

National Flour Mills Limited

So much more than Flour!

National Flour Mills Limited

National Flour Mills Limited

Scotiabank Trinidad and

Citibank (Trinidad and

The Trinidad and Tobago Central

Ashmead Ali and Company

J.D. Sellier & Company

So much more than Flour!

National Flour Mills Limited

Notice of Forty-First Annual Meeting

BY ORDER OF THE BOARD

Date: 26th of August 2014

Although times may change.

will always remain.

National Flour Mills Limited

Karen Tom Yew

National Flour Mills Limited

So much more than Flour!

National Flour Mills Limited

Cultivating the right culture, through overhaul

The Board holds strongly to the view that the

Capital and Corporate Structure

National Flour Mills Limited

Chairmans Review (continued)

Plant and Machinery

On behalf of the Board of Directors, I wish to extend

So much more than Flour!

National Flour Mills Limited

Cheryl Lee Kong

Cheryl Edwards General Manager

National Flour Mills Limited

NFM purchases quality wheat for the

So much more than Flour!

National Flour Mills Limited

Chief Executive Officers Review

Return on Shareholders Equity

Financial Review and Analysis

National Flour Mills Limited

CEOs Review (continued)

The Companys cost of borrowing fell by

Liquidity and Financial Position

The liquidity and financial position improved

The current operations of NFM continues to

So much more than Flour!

NFM, understanding the importance of

National Flour Mills Limited

CEOs Review (continued)

Our Strategy Going Forward

NFM has already achieved the ISO and HACCP