Remgro Limited · JSE:REM

Remgro — FY2006 Earnings Presentation

33 slides from Remgro's earnings presentation, Jun 23, 2006

  1. Slide 1: Results Presentation

    Results Presentation For the year ended 31 March 2006 23 June 2006

  2. Slide 2: Agenda

    FINANCIAL HIGHLIGHTS UNDERLYING RESULTS INTRINSIC VALUE SHARE AND DIVIDEND INFO QUESTIONS

  3. Slide 3: Financial Highlights

    FINANCIAL HIGHLIGHTS

  4. Slide 4: Financial Highlights

    Financial Highlights Final March Final March % change ‘06 ’05(1) Headline earnings (R’m) 5 084 4 998 1.7% HEPS (cents) 1 052.3 1 005.0 4.7% (2) Headline earnings excl non­recurring BEE costs (R’m) 5 464 4 998 9.3% HEPS – excl non­recurring BEE costs 1 130.9 1 005.0 12.5% (cents) EPS (cents) 1 697.6

  5. Slide 5: Corporate activity since March 2005

    Corporate activity since March 2005 Share repurchases • Remgro repurchased ­ 8 549 237 shares ­ at an average price of R114.34 per share ­ for a total amount of R977.5 million during the financial year ended 31 March 2006 ­ wholly­owned subsidiaries sold 37 691 443 shares, held in treasury, to Remgr

  6. Slide 6: Corporate activity since March 2005

    Corporate activity since March 2005 ABSA • During July 2005, Remgro sold its total shareholding in ABSA for a consideration of R5 064 million (after tax gain ­ R2 570 million) FirstRand • In May 2005 FirstRand implemented its BEE transaction • All shareholders sold 7.6 shares for each 100 shares hel

  7. Slide 7: Corporate activity since March 2005

    Corporate activity since March 2005 Sage • During September 2005 Remgro sold its 17.9% interest in Sage for R114 million. An initial payment of R92 million was received (an after tax gain of R10 million was realised) and at 31 March 2006 the subsequent payment of R22 million was still subject to cer

  8. Slide 8: Corporate activity since March 2005

    Corporate activity since March 2005 Nampak • During September 2005 Nampak’s shareholders approved its BEE transaction and the effective date of the scheme was 31 October 2005 • Remgro sold 10 shares for every 100 shares held in Nampak at R15.13 per share and Remgro received R131.3 million during Oct

  9. Slide 9: Underlying Results

    UNDERLYING RESULTS

  10. Slide 10: Segmental headline earnings performance

    Segmental headline earnings performance (excluding non­recurring BEE costs) March 2006 Increased contribution from: Corporate Mining 1.7% 5.3% Industrial • Mining 182.4% 23.3% Tobacco 43.4% • Tobacco 14.8% • Industrial 12.7% Financial 26.3% Off­set by: March 2005 Corporate • Financial 14.2% 0.6% Min

  11. Slide 11: Summary of underlying performance

    Summary of underlying performance R’million March ‘06 March ‘05 %change Tobacco interests 2 369 2 063 14.8% Financial interests 1 436 1 674 (14.2)% Industrial interests 1 275 1 131 12.7% Mining interests 288 102 182.4% Corporate 96 28 242.9% Headline Earnings excl non­recurring 5 464 4 998 9.3% port

  12. Slide 12: Tobacco

    Tobacco Headline earnings % Intrinsic value % R’million Mar’06 Mar’05 change Mar’06 Mar’05 change R&R / BAT 2 369 2 063 14.8% 34 065 26 276 29.6% Avg ZAR:£ 11.41 11.53 (1.0)% rate Highlights • R&R’s contribution to headline earnings increased by 14.8% and was due to BAT’s strong underlying performan

  13. Slide 13: Tobacco (cont'd)

    Tobacco (cont’d) £’million Mar’06 Mar’05 Earnings attributable to BAT 1 942 1 731 (excl non­recurring items) Movement in NPV of preference shares & dividends ­ (8) 1 942 1 723 R&R’s share of adjusted attributable profit of BAT 558 489 Movement in NPV of BAT preference shares & dividends ­ 8 R&R’s no

  14. Slide 14: Tobacco (cont'd)

    Tobacco (cont’d) • As at 31 March 2006, Remgro had an effective interest of 10.2% in BAT • During March 2006, Richemont redeemed a portion of its R&R debentures, for cash, amounting to £285 million • Remgro elected not to redeem its pro rata portion of the R&R debentures amounting to £142.5 million

  15. Slide 15: Financial

    Financial Headline earnings % Intrinsic value % (excl NR BEE) R’million Mar’06 Mar’05 change Mar’06 Mar’05 change FirstRand 697 626 11.3% 9 623 6 941 38.6% RMBH 616 534 15.4% 7 990 5 874 36.0% ABSA 123 509 (75.8)% ­ 4 629 ­ Other 0 5 Nm 1 146 Nm Total 1 436 1 674 (14.2)% 17 614 17 590 0.1% Highlight

  16. Slide 16: Industrial

    Industrial Headline earnings % Intrinsic value % (excl NR BEE) R’million Mar’06 Mar’05 change Mar’06 Mar’05 change Medi­Clinic 199 263 (24.3)% 3 531 2 732 29.2% Distell 164 130 26.2% 2 112 1 405 50.3% UBR 146 105 39.0% 1 984 1 711 16.0% Total SA 254 202 25.7% 1 889 1 187 59.1% Rainbow 250 134 86.6%

  17. Slide 17: Industrial (cont'd)

    Industrial (cont’d) Improved performances were mainly due to: Rainbow • Rainbow’s strong performance is mainly due to improved product mix, lower contractual food service pricing and volume increases UBR • The general economic sentiment in Israel is improving, although the political situation remain

  18. Slide 18: Industrial (cont'd)

    Industrial (cont’d) Total SA • The results were positively impacted by the sustained increase in the fuel price due to the US dollar crude oil price and the value of the rand • This translated into gains in the value of inventory on hand and refining margins Distell • The increase in headline earnin

  19. Slide 19: Industrial (cont'd)

    Industrial (cont’d) Lower results were reported by: Dorbyl • Dorbyl’s HEPS, which excludes the profit on disposal by Alpine, decreased substantially due to the STC charge on the special dividend declared in August 2005 following the disposal of Alpine Medi­Clinic • Medi­Clinic posted strong results

  20. Slide 20: Mining

    Mining Headline earnings % Intrinsic value % R’million Mar’06 Mar’05 change Mar’06 Mar’05 change Implats 277 70 295.7% 3 886 1 751 121.9% Trans Hex 10 31 (67.7)% 363 529 (31.4)% Gencor 1 1 ­ 8 6 33.3% Total 288 102 182.4% 4 257 2 286 86.2% Highlights • The Implats increase in headline earnings is du

  21. Slide 21: Corporate finance & other

    Corporate finance & other Headline earnings (excl NR BEE) R’million Mar’06 Mar’05 Treasury 146 98 Net corporate costs (1) (56) (76) Other interests 6 6 Total 96 28 Intrinsic value R’million Mar’06 Mar’05 Sundry (liabilities) / assets (401) 355 Note: (1) Net corporate costs declined mainly as a resul

  22. Slide 22: Analysis of comparable headline earnings

    Analysis of comparable headline earnings (cents per share) 2006 2005 Headline earnings as reported 1 052.3 1 005.0 Absa’s contribution (25.4) (102.2) STC payable on special dividends by Dorbyl and Medi­Clinic 26.5 ­ Implats special dividend (38.0) ­ After tax interest impact of Remgro’s special divi

  23. Slide 23: Cash movement at the centre

    Cash movement at the centre 11,000 6 412 (1) (463) (2) (1 607) 10,000 9,000 (2 918) 8,000 7,000 R million (926) 6,000 4 701 5,000 2 568 163 4,000 3,000 2,000 1 472 1,000 0 movement income buybacks Investments Investments dividend dividends dividends dividends Ordinary Other Special Share BAT realise

  24. Slide 24: Total cash

    Total cash At 31 March 2006 R’million Local Offshore Total Per consolidated balance sheet 4 628 1 729 6 357 Less: Cash from other operating (562) ­ (562) subsidiaries Cash at the centre 4 066 1 729 5 795 Attributable share of R&R’s cash ­ 1 524 1 524 Available cash 4 066 3 253 7 319 Offshore cash at

  25. Slide 25: Intrinsic Value

    INTRINSIC VALUE

  26. Slide 26: Remgro's intrinsic value

    Remgro’s intrinsic value R’million March ‘06 Mar ‘05 %change Tobacco interests in GBP (£’m) 3 201 2 236 43.2% Tobacco interests 34 065 26 276 29.6% Financial interests 17 614 17 590 0.1% Industrial interests 15 986 11 979 33.5% Mining interests 4 257 2 286 86.2% Other interests 16 462 Nm Deferred CG

  27. Slide 27: Intrinsic value vs share price

    Intrinsic value vs share price Discount as at 21/06/06: 16.3% 16500 Discount as at 31/03/06: 14.4% 15000 13500 Discount as at 31/03/05: 21.8% Cents 12000 10500 9000 7500 6000 21 June 2006 28 May 2004 28 July 2004 28 January 2005 28 May 2005 28 July 2005 28 January 2006 28 May 2006 28 March 2004 28 M

  28. Slide 28: Share & Dividend Info

    SHARE & DIVIDEND INFO

  29. Slide 29: Share price performance

    Share price performance Remgro’s relative share performance (based to 100) since 29.09.2000 350 300 250 200 150 100 50 21/06/ 2006 29/09/2000 29/12/2000 30/03/2001 29/06/2001 28/09/2001 31/12/2001 28/03/2002 28/06/2002 30/09/2002 31/12/2002 31/03/2003 30/06/2003 30/09/2003 31/12/2003 31/03/2004 30/0

  30. Slide 30: One year share price performance

    80 90 100 110 120 130 140 150 160 01/04/2005 11/04/2005 19/04/2005 28/04/2005 09/05/2005 17/05/2005 25/05/2005 02/06/2005 10/06/2005 21/06/2005 over the same period 29/06/2005 07/07/2005 15/07/2005 25/07/2005 02/08/2005 11/08/2005 19/08/2005 29/08/2005 06/09/2005 30 14/09/2005 Remgro 22/09/2005 30/0

  31. Slide 31: Ordinary dividends

    Ordinary dividends 1200 4.5x 1131 4.0x 3.8x 4.0x 3.8x 1005 1008 1000 940 931 3.3x 3.5x 815 3.2x 3.1x 800 3.0x 2.8x 660 2.5x 612 2.2x Times Cents 600 1.8x 2.0x 1.7x 543 1.9x 463 400 381 1.5x 1.6x 271 1.0x 200 0.5x 0 0.0x 2001 2002 2003 2004 2005 2006 HEPS Cash EPS Dividend cover Cash cover 31

  32. Slide 32: Dividend distribution

    Dividend distribution 700 6.0% 600 600 5.0% 4.8% 500 4.0% 4.0% 3.4% 400 400 3.3% 3.3% 361 Times Cents 3.0% 314 285 2.7% 300 248 206 2.0% 200 200 162 100 1.0% 100 0 0 0 0.0% 2001 2002 2003 2004 2005 2006 Ordinary dividend Special dividend Ordinary dividend yield 32

  33. Slide 33: Questions

    QUESTIONS

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