Slide 1: Investor Analyst Interim Results Presentation, period ending 31 August 2024
INVESTOR ANALYST Interim Results Presentation for the period ending 31 August 2024 Presented by: Glen Gerber (CEO) and James Robertson (GFD) www.santova.com 7 November 2024
Slide 2: Introduction
INTRODUCTION Much like the previous financial year, the first six months of the 2025 financial year remained challenging globally. Inflation has started to recede; interest rates remain high by historic standards and continue to weigh on consumer demand, resulting in pressure on trade volumes - pa
Slide 3: The Drewry World Container Index
The Drewry World Container Index 31 October 2024 The Drewry WCI composite index increased 4% to $3,213 per feu (forty-foot equivalent unit) 69% below the previous pandemic peak of $10,377 in September 2021 126% more than the average 2019 (pre-pandemic) of $1,420. Source: Drewry World Container I
Slide 4: North America
NORTH AMERICA At the outset, a decision was made to take the ‘tough road’ – “grassroots” the business. The transition in ownership, the re-alignment of the business, accompanied by decline in revenue due to lower freight rates and lower demand from customers in Southeast Asia - its main trade la
Slide 5: Europe and the United Kingdom
EUROPE AND THE UNITED KINGDOM United Kingdom The UK, while facing similar challenges to the rest of the Group, benefited from its diversified operations. Tradeway (Shipping), delivered solid results off a record-year in the prior year. SAI Logistics maintained its steady performance, benefitti
Slide 6: Asia Pacific
ASIA PACIFIC Singapore • Making good progress on the development of ‘direct client’ business as opposed to Agent referral business. • The transition (‘unsettled period’) to a more experienced workforce and effective leadership of the business is starting to yield good returns through global trade se
Slide 7: Africa
AFRICA South Africa The South African economy has benefitted from a stable electricity supply in the past six months as well as a positive investment sentiment surrounding the formation of a Government of National Unity. Whilst low freight rates and limited project work had a significant impact,
Slide 8: Outlook
OUTLOOK The outlook for the next 6 months to 28 February 2025 remains uncertain. The World economic forum portray a mood of cautious optimism about the global economy. This optimism is tempered by the uncertainty about geopolitical and domestic political developments, which are seen as sources of vo
Slide 9: New Client Revenue by Region
NEW CLIENT REVENUE BY REGION March 2023 – August 2023 | March 2024 – August 2024 Including revenue generated during the 6-month period for any new clients signed on in the preceding 12 months Asia Pacific 8% Africa Europe 36% 20% United Kingdom 36%
Slide 10: Client & Transaction Analysis
CLIENT & TRANSACTION ANALYSIS March 2023 – August 2023 | March 2024 – August 2024
Slide 11: Slow and Consistent Growth
SLOW AND CONSISTENT GROWTH A successful strategy for Santova which has and will continue to lead to long-term success. Santova Group Movement over 5 years 53 % 113 % 70 % 126 % -91 % 261 %
Slide 12: Reasons for increased positivity
However, there are reasons for increased positivity. The period of high inflation that occurred over the previous two years appears to be largely behind us with central banks around the world moving into a rate cutting cycle, which should increase disposable income and stimulate trade. In additi
Slide 13: Strategic Development - Acquisitions
STRATEGIC DEVELOPMENT - ACQUISITIONS We will continue seeking quality businesses that meet our criteria. Four ‘lost years’ - 3 years of abnormally high earnings obscured by COVID-19. Then the last year saw depressed earnings in the context of a global ‘recessionary environment’ and low 2024 Privat
Slide 14: Insight to Small cap & Santova Valuations
Insight to Small cap & Santova Valuations Over 52% of companies delisted are not part of the opportunity set as defined by asset managers. Smaller companies that do not meet the typical size and liquidity requirements of the average asset manager comprising a significant portion of delisted companie
Slide 15: The Context: A Changing Market
The Context: A Changing Market Whilst we have an aggressive trend of de-listings and limited number of new listings, the market capitalisation of the index exhibited an upward trajectory, highlighting a consolidation of market value among fewer entities. The total market capitalisation lost due to c
Slide 16: Our priority and our challenge
Our priority and our challenge The economy will strengthen, interest rates and inflation will lower, but the availability of a driven and skilled workforce is unlikely to improve. The combination of numerous socio-eco-political disruptions has created a challenging human capital environment. We have
Slide 17: Industry must adapt to technological disruptions and rising costs
Industry must adapt to technological disruptions and rising costs to maintain profitability in the face of geopolitical uncertainty and instability. This will require investment in innovation, operational excellence (quality workforce, proactive energetic leadership), and customer-centric engagement
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Slide 19: Interim Results
INTERIM RESULTS For the period ending 31 August 2024 5 June 2024
Slide 20: Interim Results: Statement of Profit or Loss Analysis
INTERIM RESULTS: STATEMENT OF PROFIT OR LOSS ANALYSIS 31 August 31 August Move 2024 2023 R'000 R'000 % BILLINGS 2,973,903 2,838,784 4.8% Increase in freight rates and Red Sea surcharges. REVENUE 300,902 321,139 (6.3)% Decline in logistics revenue in the UK (R16m) and Europe (R6m). Net interest 10,13
Slide 21: Interim Results: Operating Context
INTERIM RESULTS: OPERATING CONTEXT 31 AUGUST 31 AUGUST Weighted Movement 2024 2023 average Mvmt R'000 R'000 % % AVERAGE EXCHANGE RATES Primary Operating Currencies Euro EUR 20.00 20.17 (0.8)% (0.3)% Pound Sterling GBP 23.49 23.24 1.1% 0.4% US Dollar USD 18.46 18.52 (0.3)% 0.0% Australian Dollar AUD
Slide 22: Interim Results: Statement of Financial Position Analysis
INTERIM RESULTS: STATEMENT OF FINANCIAL POSITION ANALYSIS 31 AUGUST 29 FEBRUARY Move 2024 2024 R'000 R'000 % Cash and cash equivalents 415,214 477,206 (13)% Strong cash position with 96.0% of cash held offshore. Current tax assets 809 2,219 (64)% Deferred tax assets 6,344 8,800 (28)% Reversal of pro
Slide 23: Interim Results: Ratio Analysis
INTERIM RESULTS: RATIO ANALYSIS 31 August 31 August Move 2024 2023 R'000 R'000 % Increase in freight rates and Red Sea surcharges passed on to clients with little to no - Billings/revenue margin 10.5% 11.6% (1.1)% margin. Decline in revenue primarily in the UK and EU regions. Operating Margin remain
Slide 24: Interim Results: Cashflow Analysis
INTERIM RESULTS: CASHFLOW ANALYSIS 31 AUGUST 2024 R'mil CASH ON HAND (62.0) - 31 August 2024 415.2 - 29 February 2024 477.2 ANALYSIS OF MAJOR CASH FLOW MOVEMENTS (62.0) Net cash from operating activities (5.8) Weak cash generation due to the escalating freight rate and red sea issues. Repurchase of
Slide 25: Santova Limited
Australia Germany SANTOVA Hong Kong Mauritius LIMITED Netherlands Singapore An international, technology- South Africa based trade solutions specialist United Kingdom www.santova.com United States Vietnam Thank you for your attendance and your continued support