Reunert Limited · JSE:RLO

Reunert — Corporate Update (2005)

23 slides from Reunert's corporate update, 2005

  1. Slide 1: Company Presentation 2005

    COMPANY PRESENTATION 2005

  2. Slide 2: RC&C Finance

    RC&C FINANCE „ Who is RC&C Finance? „ Business Model „ Funding „ Base Analysis „ Relevant Statistics „ The Future

  3. Slide 3: RC&C Finance

    RC&C FINANCE „ RC&C Finance is the in-house asset finance company for the Reunert group. „ We specialise in office equipment for corporate customers for Nashua, Panasonic Sietel and their franchises. „ Only Rental agreements are financed. „ We advance funds against against a fixed income stream.

  4. Slide 4: Mission Statement

    MISSION STATEMENT “Working together, to create wealth, through innovative finance products, to maximise the rewards for all our partners in profit”

  5. Slide 5: Base Analysis

    BASE ANALYSIS „ SPLIT BY CUSTOMER ‹ Nashua 87% ‹ Panasonic 8% ‹ Sietel 5%

  6. Slide 6: History

    HISTORY „ Started in 1988 as “Barcep” „ 1993 Renamed “RC&C Finance” „ 1999 Relaunch with “Partners in Profit” and a new logo „ 2000 Introduction of Recourse and Credit Warranty

  7. Slide 7: History (Cont'd)

    HISTORY (Cont’d) „ 2001 Launch “Nashua Finance” and “Panasonic Finance” brands. „ 2002 Revolutionise the credit application form. „ 2003 Electronic credit vetting goes live „ Dec 2003 sale of R1,189million book to Standard Bank.

  8. Slide 8: Current

    CURRENT „ 2005 Implementation of ISO9004 „ 2005 BBBEE Certification

  9. Slide 9: Competition

    COMPETITION „ Union Finance (ABSA) „ Sasfin „ Merchant West  Approach end users directly  Offer Below prime blanket funding

  10. Slide 10: Business Model

    BUSINESS MODEL „ Deals administered on the Nashua AS400 system  Amortised  Billing „ Rentals collected from end users by franchises „ Franchise pays finance full amount at month end „ Franchise is liable to pay rental or repay balance of amount advanced „ Review function audits all franchise contr

  11. Slide 11: Business Model – Credit

    BUSINESS MODEL – CREDIT „ Since 2003 Credit Vetting has been automated „ Applications faxed to a file server or emailed direct „ System automatically requests all applicable data „ System scores the application and rates it.

  12. Slide 12: Business Model – Credit

    BUSINESS MODEL – CREDIT „ Manual final sign off „ Benefits: ‹ Improved & accurate turnaround times ‹ Less paperwork ‹ Guaranteed consistency ‹ Higher policy standards maintained ‹ Accurate performance reporting

  13. Slide 13: Funding

    FUNDING „ Overnight Funds from Shareholders „ Fixed Rate deals backed by fixed funding „ Utilise Swaps to fix margin on fixed rate deals „ Swaps matched to the expected life of the deal

  14. Slide 14: Funding (Cont'd)

    FUNDING (Cont’d) „ Policy to cover 70% fixed business. ‹ Equity and Swaps ‹ Based on Repayment profile of book „ Policy is to fix margin and not speculate. „ Swaps are defined as Derivative financial instruments for accounting and subject to AC133 adjustments.

  15. Slide 15: Funding (Cont'd)

    FUNDING (Cont’d) „ The book is funded as follows  Equity 10%  Non interest bearing funding 5%  Shareholder banks 85% „ Banks facility currently R1.2billion „ Excess cash may be invested by Reunert

  16. Slide 16: Base Analysis (Cont'd)

    BASE ANALYSIS (Cont’d) „ Approx’ 10,000 End users „ Largest End user 1.5% of total base „ Top 50 End users = 21% of total base „ Top 50 Geographically spread throughout SA ( Mainly Gauteng)

  17. Slide 17: Statistics - Credit

    STATISTICS - CREDIT „ Credit Vet average 1,480 applications pm „ Approval ratio 69% (average) „ Discount average 1,656 contracts „ Turnaround times  Average 7h51  Existing Users 6h17  New Users 12h13

  18. Slide 18: Base Analysis

    BASE ANALYSIS Own Book Sold Book Total Value 903,189 482,575 1,385,764 (R’000s) Average 41months 21months 30months period to run

  19. Slide 19: Base Analysis (Cont'd)

    BASE ANALYSIS (Cont’d) „ Fixed Rentals 82% „ Linked to Prime Rentals 18% „ Coverage of Fixed Deals 65%  Equity Cover 12%  Swaps 88%

  20. Slide 20: Sale of Base

    SALE OF BASE „ The book was sold in December 2003 „ Reasons; The perception was that the assets and liabilities had too large an impact on the Reunert balance sheet „ Subsequent to the sale no material adjustments to the Reunert value were forthcoming. „ It is not the current intention to sell the b

  21. Slide 21: Statistics – Ratios

    STATISTICS – RATIOS 2001 2002 2003 2004 Return on 41.5% 29.8% 4.5% 51.9% Equity Costs to 17.7% 15.5% 18.4% 9.1% Revenue Return on 3.7% 2.9% 0.0% 10.0% Assets Bad Debts 0.1% 0.5% 0.9% 0.0%

  22. Slide 22: The Future

    THE FUTURE „ Buy out capitalised base of franchises. „ Finance of buildings for group operations. „ Offer long term payment options to group customers on large contracts. „ Growth to come from within the markets we know and can manage.

  23. Slide 23: Thank You

    _ NASHUA JFINANC EN

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