Bidvest Group Limited · JSE:BVT
Bidvest — The Bidvest Group — FY2016 Earnings Presentation
39 slides from Bidvest's earnings presentation, September 2016
Slide 1: Reviewed Provisional Financial Results
Reviewed Provisional Financial Results Year ended June 2016
Slide 2: Agenda
Agenda 01 Introduction Lindsay Ralphs – Bidvest CE 02 Financial review Peter Meijer– Bidvest CFO 03 Operational updates Lindsay Ralphs – Bidvest CE 04 Strategic overview and outlook Lindsay Ralphs – Bidvest CE 05 Appendices Included after presentation slides Reviewed Provisional Financial Results Ye
Slide 3: Introduction
Lindsay Ralphs Bidvest CE Introduction
Slide 4: We are Bidvest key figures
1988 R91.8 bn R7.3 bn R51 bn R7 bn Established Turnover EBITDA Market cap Cash generated R25.1 bn Funds Employed WE ARE BIDVEST Proudly yesterday, proudly tomorrow 112 000 Employees 4
Slide 5: We are Bidvest
We are Bidvest A leading South African services, wholesale and distribution group operating in the areas of commercial and industrial products, electrical products, financial services, freight management, office and print solutions, outsourced hard and soft services and automotive retailing A blen
Slide 6: Group structure
Group structure LP Ralphs Chief Executive P Meijer Group Financial Officer Executive team comprising M Madisa Executive Director G McMahon Executive Director Bidvest Industrial Bidvest Namibia Bidvest Properties Material Associates Other Investments Ontime Automotive UK Services Automotive Propertie
Slide 7: A diversified portfolio
A diversified portfolio Contribution to revenue Contribution to trading profit 2% 3% 6% 5% 17% Services 5% 7% Freight 27% Office and Print 8% 8% 8% Automotive Financial Services 5% 10% Commercial Products 14% Electrical 18% Namibia 12% Corporate 33% 12% No segment contributing more than 30% of profi
Slide 8: Highlights for the year
Highlights for the year Successful unbundling on 30 May 2016 HEPS 1200 1054.1 1028.9 HEPS (continuing operations) increased by 2.5% to 1 054.1 cents, final DPS declared 1000 of 232 cents Cents per share 800 600 Revenue grew by 3.6% to R68.2 billion 400 200 0 Trading profit up 3.0% to R5.8 billion 20
Slide 9: Financial Review
Peter Meijer CFO Financial Review
Slide 10: Financial highlights
Financial highlights R billion Year ended June 30 2016 Year ended June 30 2015 Change Turnover 91.8 88.6 3.5% Revenue 68.2 65.9 3.6% Gross profit %* 29.2% 28.8% Expenses %* 21.4% 20.8% EBITDA 7.3 7.1 3.9% Trading profit 5.8 5.6 3.0% Trading margin %* 8.4% 8.4% Headline earnings 3.5 3.4 3.6% HEPS
Slide 11: Income statement analysis
Income statement analysis • Revenue increased by 3.6% or R2.4 billion Revenue • South African operations grew revenue by 3.1% and Bidvest Namibia by 4.7% • Significant increase in Commercial Products and Financial Services revenue • Improvements in gross margin from changes in revenue mix – shedding
Slide 12: Income statement analysis (continued)
Income statement analysis (continued) Associate • Decline of R52 million net of capital items income • Excluding capital items adjustments, would be up 5% Non-controlling • R92.8 million decline, mainly in line with our share of earnings of Bidvest Namibia interest • The unbundling transaction resul
Slide 13: Debt and funding – a conservative approach to gearing
Debt and funding – a conservative approach to gearing Total debt of R8.1 billion EBITDA interest cover of 8.0 times vs. 8.7 times in 2015 Percentage of fixed debt 36% Ample headroom to fund organic or acquisitive expansion Moody’s Investor Services credit rating* Long term Short term Outlook
Slide 14: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement Year ended June 30 2016 Year ended June 30 2015 R bn R bn 6.7 Cash generated from ops pre wc 6.8 0.3 Working capital released/(absorbed) (0.7) (0.9) Net Finance charges (0.7) (1.2) Taxation (1.3) (3.3) Distributions (1.9) (3.4) Cash effects of investment act’s (2.7)
Slide 15: Operational updates
Lindsay Ralphs Bidvest CE Operational updates
Slide 16: South Africa | Overview
Bidvest South Africa | Overview Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 67 205 517 65 190 424 3.1% Trading profit 5 306 501 5 146 464 3.1% Trading margin 7.9% 7.9% EBITDA 6 721 727 6 461 746 4.0% Average Funds Employed 15 980 467 15 243 093 4.8% Average R.O.F.E. 33.2% 3
Slide 17: Services
Bidvest Services | CEO: Alan Fainman Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 12 420 819 12 613 704 (1.5%) Trading profit 1 531 273 1 445 206 6.0% Trading margin 12.3% 11.5% EBITDA 1 933 011 1 866 004 3.6% Average Funds Employed 1 894 497 1 772 229 6.9% Average R.O.F.E.
Slide 18: Freight
Bidvest Freight | CEO: Anthony Dawe Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 6 013 814 6 858 289 (12.3%) Trading profit 1 019 816 1 059 728 (3.8%) Trading margin 17.0% 15.5% EBITDA 1 296 475 1 310 473 (1.1%) Average Funds Employed 1 752 513 1 723 762 1.7% Average R.O.F.E
Slide 19: Office and Print
Bidvest Office and Print | CEO: Kevin Wakeford Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 10 076 465 10 575 028 (4.7%) Trading profit 706 295 742 446 (4.9%) Trading margin 7.0% 7.0% EBITDA 856 007 877 044 (2.4%) Average Funds Employed 2 526 979 2 403 912 5.1% Average R.O.F
Slide 20: Automotive
Bidvest Automotive | CEO: Steve Keys Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 24 062 557 23 683 728 1.6% Trading profit 674 709 731 723 (7.8%) Trading margin 2.8% 3.1% EBITDA 880 124 975 148 (9.7%) Average Funds Employed 3 864 475 3 621 766 6.7% Average R.O.F.E. 17.5% 20
Slide 21: Financial Services
Bidvest Financial Services | CEO: Japie van Niekerk Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 3 336 302 2 035 048 63.9% Trading profit 582 204 527 576 10.4% Trading margin 17.5% 25.9% EBITDA 875 918 719 877 21.7% This division comprising Bidvest Bank and the Insurance d
Slide 22: Commercial Products
Bidvest Commercial Products | CEO: Howard Greenstein Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 5 920 546 4 168 360 42.0% Trading profit 474 764 334 705 41.8% Trading margin 8.0% 8.0% EBITDA 526 201 374 803 40.4% Average Funds Employed 1 392 505 1 169 031 19.1% Average R.O
Slide 23: Electrical
Bidvest Electrical | CEO: Stanley Green Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 5 375 014 5 256 267 2.3% Trading profit 317 440 305 080 4.1% Trading margin 5.9% 5.8% EBITDA 353 990 338 316 4.6% Average Funds Employed 1 572 217 1 530 121 2.8% Average R.O.F.E. 20.2% 19.9%
Slide 24: Namibia
Bidvest Namibia | CEO: Sebby Kankondi Year ended Year ended R’000s June 30 2016 June 30 2015 Change Revenue 3 858 949 3 534 770 9.2% Trading profit 296 662 400 186 (25.9%) Trading margin 7.7% 11.3% EBITDA 377 544 472 025 (20.0%) Average Funds Employed 1 736 956 1 388 953 25.1% Average R.O.F.E. 17.1%
Slide 25: Corporate
Bidvest Corporate Year ended Year ended R’000s June 30 2016 June 30 2015 Change Turnover 1 818 947 1 538 558 18.2% Trading profit 150 316 41 896 258.8% Trading margin 8.3% 2.7% Corporate comprises Bidvest Properties, material associates and other investments The Bidvest Property Division perform
Slide 26: Strategic overview
Lindsay Ralphs Bidvest CE Strategic overview
Slide 27: Strategy and prospects
Strategy and prospects • Local elections positive for the economy Economic • Rand more stable outlook • Business confidence levels improving • Seven core well managed businesses A strong diversified • Cash generative portfolio • Other investments – require close scrutiny • Excellent asset management
Slide 28: Appendix 1
Appendix 1
Slide 29: Services
Bidvest Services | CEO: Alan Fainman First year of newly constituted Services division Real growth in four main clusters Security Services, post Cash in Transit exit, up 20%. Protea and BidTrack delivering pleasing earnings Double digit growth from Prestige, TMS and Pureau BidAir excelled
Slide 30: Freight
Bidvest Freight | CEO: Anthony Dawe Our larger businesses performed well despite world trade and commodity markets remaining depressed BTT had a pleasing year with chemical and edible oil volumes up. BTT invested over R300 million in new facilities including LPG and fuel capacity SA Bulk Termi
Slide 31: Office and Print
Bidvest Office and Print | CEO: Kevin Wakeford Combination of Office and Paperplus segments successfully completed Comparisons distorted by Tanzanian voter registration project and the sale of Oce in the prior year Walton’s remains the clear market leader but operations require simplification
Slide 32: Automotive
Bidvest Automotive | CEO: Steve Keys Total dealer market down 7.5% – Bidvest showing a marginal increase in market share A shift in the SA vehicle market from new to used vehicles Benefit from full-year effect of Car Rental’s divisional re-integration, the launch of Bidvest Car Rental and a st
Slide 33: Financial Services
Bidvest Financial Services | CEO: Japie van Niekerk Banking Moody’s upgraded Bidvest Bank to A1.za/P-1.za with a stable outlook (up from A3.za/P-2.za) Expansion into acquiring (card processing) via partnership with First Data Trade finance growth continued. Solid gains from Old Mutual and othe
Slide 34: Commercial Products
Bidvest Commercial Products | CEO: Howard Greenstein Solid trading results from both the Industrial and Consumer Divisions with good margin management in a volatile exchange rate environment. Cash flows were good as was asset management Plumblink bedded down, performance well in excess of expect
Slide 35: Electrical
Bidvest Electrical | CEO: Stanley Green Cable industry under pressure in a deflationary environment and infrastructure development, mining and construction at a low ebb First full-year contribution from Lighting Structures, Phambili and Voltex Botswana Acquisitions - SEA, a maker of specialise
Slide 36: Namibia
Bidvest Namibia | CEO: Sebby Kankondi Problematic access to fishing quotas Contribution to profit 0% Declining market prices and low demand for Namibian horse mackerel Freight division unable to secure large projects 6% 2% Food and Distribution flat on 2015, improvement plan still gaining tr
Slide 37: Appendix 2
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Slide 38: Shareholders
Shareholders Investment management shareholdings Geographic split of investment managers Investment manager Total shareholding % 13% PIC 45 178 223 13.47 4% J.P. Morgan Asset Management 22 470 287 6.70 Genesis Investment Management LLP 14 946 534 4.46 16% 45% GIC Asset Management Pty Ltd 13 639 230
Slide 39: Reviewed Provisional Financial Results
Reviewed Provisional Financial Results Year ended June 2016