Khanya Cold Chain Business Plan — Appendix E: Risk Register

Detailed risk register scoring likelihood and impact across commercial, operational, financial and technical risks with mitigations.

Appendix E: Risk Register

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Risk

Likelihood

Impact

Mitigation and residual position

Occupancy ramp slower than plan

High

Severe

The dominant risk. Break-even including debt service is 56% against a Year 1 plan of 46%, and an eight-point shortfall removes R8 498 791 of Year 3 EBITDA. Mitigated by anchor contracting of 1 200 positions before drawdown and the Section 12.4 triggers; residual risk stays high

Covenant breach in Years 1 and 2

High

High

Cover of 0.22x and 1.15x is below a standard 1.30x test. Must be addressed in the term sheet through a Year 3 covenant start, an interest reserve or a longer moratorium — not discovered at the first test date

Capital cost overrun

Medium

Severe

Refrigeration and envelope are 50% of capex on indicative pricing; a 15% overrun on those two lines is R6 675 000. Mitigated by firm fixed-price contracting with retention held to validated performance before drawdown

Electricity tariff rises faster than modelled

High

Medium

Modelled at 8.8% a year against approved increases of 8.76% for 2026/27 and 8.83% for 2027/28. Mitigated by the Section 4 energy strategy and a contractual pass-through clause indexed to the published tariff

Lease renewal or landlord leverage

Medium

High

R89 800 000 of plant fixed into a leased building. Mitigated by a ten-year term with tenant renewal options and, ideally, a purchase option negotiated at the outset when the landlord is competing for the tenant

Ammonia incident or regulatory delay

Low

Severe

Major hazard installation obligations, mandatory risk assessment and emergency planning. Approval placed early in the programme as a gating item; residual safety risk managed through the competent-person regime and insurance

Customer concentration

High

High

Anchor tenancy of 1 200 pallets creates dependence on a small number of counterparties. Mitigated by capping any single customer at 20% of positions from Year 3

Goods-in-trust claim

Low

Severe

Stored value can exceed the value of the plant, and a sustained excursion can generate a claim larger than a year of EBITDA. Mitigated by monitoring, alarming, standby generation, contractual liability limits and R1 820 000 of insurance

Refrigeration plant failure

Medium

High

Mitigated by multiple chambers and zoned plant so one chamber can fail without stopping the site, in-house technicians rather than a wholly external contract, and critical spares held on site

Fleet utilisation below plan

Medium

Medium

Distribution loses money below roughly 70% utilisation. Mitigated by capping fleet growth to stored volume and never chasing third-party line-haul

Diesel price volatility

Medium

Low

Modelled at R23.50 per litre escalating 5.0%. Mitigated by a fuel surcharge clause indexed to the gazetted price

Load shedding returns

Low

Medium

Energy availability factor has improved to about 65.85% with baseload units available more than 98% of the time. Standby generation of 1.2 MVA covers residual outages at a diesel cost well above grid rates