Kap Limited · JSE:KAP
Kap — Debt Investor Presentation (April 2025)
20 slides from Kap's debt investor presentation, Apr 10, 2025
Slide 1: Bond Auction Roadshow
BOND AUCTION ROADSHOW MANAGEMENT PRESENTATION 10 APRIL 2025 BOND AUCTION ROADSHOW 10 APRIL 2025 1
Slide 2: Agenda
AGENDA INTRODUCTION Nedbank RESULTS OVERVIEW Frans Olivier DEBT OVERVIEW Frans Olivier DEBT ISSUANCE OVERVIEW Reino Louw Q&A Frans Olivier/Reino Louw BOND AUCTION ROADSHOW 10 APRIL 2025 2
Slide 3: Results Overview
RESULTS OVERVIEW Frans Olivier Chief financial officer BOND AUCTION ROADSHOW 10 APRIL 2025 3
Slide 4: Salient features of the 1H25 results
SALIENT FEATURES OF THE 1H25 RESULTS Revenue EBITDA Operating profit R15.4 billion R1.9 billion R1.2 billion 2% 4% 8% Operating margin Headline earnings per share Net working capital 7.5% 17.2 cents R4.2 billion 80 bps 21% 8% Cash generated from operations Expansion capital expenditure N
Slide 5: Key takeaways from the 1H25 results
KEY TAKEAWAYS FROM THE 1H25 RESULTS Operating environment • Broadly positive sentiment during the period following GNU, two-pot retirement system, suspension of loadshedding, lower inflation and interest rates • Not yet filtering through to trading activity; operating environment remained depressed
Slide 6: PG Bison
PG BISON Successful ramp-up of MDF line, with good progress made in selling additional volumes • Ramp-up of new MDF line aligned with project feasibility • Panel sales volumes increased by 6% Revenue ▪ Domestic MDF sales volumes 20% higher R3 040 million 5% ▪ Exports up 28% due to increase in MDF
Slide 7: Safripol
SAFRIPOL Improved performance underpinned by higher production volumes • Improved HDPE production efficiency following completion of R402 million HDPE conversion and extruder project in 2H24 Revenue • Production increased by 23%, largely due to prior year constraints not recurring R5 213 million • S
Slide 8: Unitrans
UNITRANS Improved result as turnaround gains traction • Revenue lower mainly due to cessation of low-margin, low-return activities; offset improved volumes in some operations Revenue • Increase in operating margin and profit supported by the benefits realised from the restructuring: R4 957 million ▪
Slide 9: Unitrans (continued)
UNITRANS Improved result as turnaround gains traction (continued) • Unitrans has a clear strategy, and the implementation thereof is progressing well: ▪ Provide end-to-end supply chain services in key sectors (agriculture, food, mining, petrochemical, passenger) ▪ Pursue organic growth (existing and
Slide 10: Feltex
FELTEX Temporary production disruptions affected results • Domestic new vehicle assembly volumes declined by 19%, with some temporary disruptions: ▪ Key model changeover at one OEM Revenue ▪ Technical-related challenges at another R1 157 million 16% • LCV and SUV sales down by 15% and up by 3%, re
Slide 11: Sleep Group (previously Restonic)
SLEEP GROUP (PREVIOUSLY RESTONIC) Positive momentum in performance despite subdued market conditions • Revenue higher largely due to a 6% increase in sales volumes of bedding units • Sales volumes of foam lower by 15% affected by exit of low-margin product line, and textiles Revenue declined by 9% R
Slide 12: Group Outlook
GROUP OUTLOOK • Uncertain macroeconomic environment expected to persist; cautiously optimistic about South Africa’s medium-term outlook following GNU • Results for the period impacted by MDF ramp-up and disruptions in domestic vehicle assembly; we view these as temporary and expect their effects to
Slide 13: Debt Overview
DEBT OVERVIEW Frans Olivier Chief financial officer BOND AUCTION ROADSHOW 10 APRIL 2025 13
Slide 14: Net Interest-Bearing Debt Forecast: Net debt reduction flight path
NET INTEREST-BEARING DEBT FORECAST Net debt reduction ‘flight path’ (Rm) 11 000 9 267 8 767 9 211 8 325 7 825 494 10 000 8 028 484 7 325 7 767 Net debt reduction target of R1 billion in 566 469 1 392 486 1 400 FY25, with further reductions thereafter 603 481 478 9 000 1 342 1 295 1 400 6 325 1 564 1
Slide 15: Net Interest-Bearing Debt Forecast: Further reduction potential
NET INTEREST-BEARING DEBT FORECAST Further net debt reduction potential (Rm) 11 000 10 000 The rate of net debt reductions is dependent on 9 211 9 267 the following material factors: 8 767 9 000 8 325 • operating environment 8 028 8 000 7 825 7 767 • polymer margins 8 267 7 325 • cash flow contribut
Slide 16: Maturity Profile
MATURITY PROFILE Net interest-bearing debt maturity at 31 December 2024 (Rm) 4 000 3 316 2H25 comments: 2 196 3 000 • KAP022 – R200 million settled on 18 Feb 2025 and KAP024 – R420 million to be 2 000 refinanced 1H26 comments: 1 000 1 120 • Both KAP026 – R340 million and 0 KAP028 – R600 million to b
Slide 17: Debt Issuance Overview
DEBT ISSUANCE OVERVIEW Reino Louw Executive: treasury and legal BOND AUCTION ROADSHOW 10 APRIL 2025 17
Slide 18: Indicative Issuance Terms
INDICATIVE ISSUANCE TERMS Issuer details Issuer KAP Limited (‘KAP’) KAP Automotive (Pty) Ltd, Sleep Group (Pty) Ltd, PG Bison (Pty) Ltd, Safripol (Pty) Ltd, Unitrans Passenger (Pty) Ltd Guarantors and Unitrans Supply Chain Solutions (Pty) Ltd DMTN programme size ZAR10 billion listed on the JSE Issue
Slide 19: Indicative Issuance Timeline
INDICATIVE ISSUANCE TIMELINE Investor roadshow Second term sheet Settlement date Hosted by Investec Including price guidance T+3 and Nedbank 30 April 2025 16 May 2025 10 |14 |15 April 2025 Auction announcement Auction date First term sheet Hosted by Investec 22 April 2025 13 May 2025 BOND AUCTION RO
Slide 20: Q&A
Q&A BOND AUCTION ROADSHOW 10 APRIL 2025