Slide 1: Investor Presentation for the year ended 30 June 2024
Investor Presentation for the year ended 30 June 2024 People and products behind a brighter future
Slide 2: Agenda
2024 Mpumi Madisa 01 Introduction Agenda Mark Steyn 02 Financial review Mpumi Madisa 03 Operational reviews Mpumi Madisa 04 Strategy & outlook 05 Appendices
Slide 3: Introduction
Introduction
Slide 4: Reflections by the CEO
Reflections by the CEO • Solid result Bidvest’s footprint expanded • 5 divisions reported trading profit growth; 4 delivered double-digit growth • 11 acquisitions concluded added to our geographic footprint, scale, product & service offering • Doubled Australian footprint • First entry into hygiene
Slide 5: Highlights
Highlights • Trading profit up 8.5% to R12.4 billion • Pleasing organic performance considering • Cash quality of earnings top-class the challenging macro environment • Operational cash generated +15.3% to R14.0 billion • Revenue +3.8% • Strong balance sheet with net debt / EBITDA 1.7x • Trading pro
Slide 6: Financial Review
Financial Review
Slide 7: Financial highlights
Financial highlights R billion Year ended 30 June 2024 Year ended 30 June 2023 Change Revenue 122.6 114.9 6.7% Gross profit margin 28.4% 29.0% ↓ Expense margin 18.7% 19.5% ↓ EBITDA 14.3 13.2 8.4% Trading profit 12.4 11.4 8.5% Trading profit margin 10.1% 10.0% ↑ HEPS (cents) 1 912.6 1 794.8 6.6% Norm
Slide 8: Income Statement analysis
Income Statement analysis • Revenue +6.7% (+3.8% organic) • Growth in Services International, Services SA and Branded Products led by activity and new business wins despite mix changes, elsewhere mainly price driven • Gross profit +4.6% • Gross margin declined 60bps to 28.4% • Raw material price pre
Slide 9: Long-dated funding profile
Long-dated funding profile • 63% of gross debt offshore; 64% of net debt • Covenant net debt / EBITDA 1.7x (FY23 1.7x) • 81% of gross debt is long-term • 0.1x added due to fx spot at YE • 54% of gross debt at variable rates • Offshore 4.8x with strong cash generation (FY23 4.7x) • Gross debt R31.8 b
Slide 10: Capital structure
Capital structure • Proactively created funding capacity • War chest → EUR395 million + R16 billion • Successfully extended multi-currency funding facility for another year • Offshore 4.8x with strong cash generation • Upsized domestic bonds at smaller spreads (FY23 4.7x) • Extended maturity Funding
Slide 11: Good cash generation
Good cash generation • Working capital seasonal release of R2.5 billion to end at R2.1 billion investment • Inventory investment in renewable energy products, new vehicles. Need to reduce inventory days in select businesses • Bidvest Bank accelerated capital deployment • Trade payables decrease due
Slide 12: Strong Balance Sheet
Strong Balance Sheet • Capex R3.5 billion (FY23 R3.4 billion) • Increased capacity in tanks and rental assets • Maintenance capex include fleet renewal, statutory tank upgrades • M&A R3.3 billion, mainly relates to Consolidated and RHS • Disposal group held for sale • Bidvest Life • Bidvest Bank and
Slide 13: Operational updates
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Slide 14: Services International CEO: Alan Fainman
Services International CEO: Alan Fainman • Excellent result boosted by acquisitions to add scale and geographic footprint • Facilities management and hygiene services contributions equal Financial performance Hygiene services Revenue +18.8% • Continued hygiene pool growth in the UK supported a stron
Slide 15: Freight CEO: Wiseman Madinane
Freight CEO: Wiseman Madinane • A solid result, off a high base. Second half lower due to the seasonality Financial performance of agricultural commodities handled Revenue +4.5% • Positive impact from improved product mix in terminal businesses • Annual rate increases, growth in capacity let, improv
Slide 16: Commercial Products CEO: Howard Greenstein
Commercial Products CEO: Howard Greenstein • Satisfactory result, considering extraordinary renewable market boom in the base Financial performance • Fierce competition in a stagnant market Revenue -9.9% • Improved gross margin and flat operating costs limited negative operating leverage R17.9bn • O
Slide 17: Services SA CEO: Akona Matsau
Services SA CEO: Akona Matsau • Outstanding result driven by double profit digit growth in 3 out of 4 clusters Financial performance • Security & Aviation cluster boosted by excellent new sales achieved, efficiency Revenue +12.4% gains in air cargo services augmented by the accretive acquisition of
Slide 18: Branded Products CEO: Gail Solomon
Branded Products CEO: Gail Solomon • A stellar stand-out result, surpassing the one billion Rand Financial performance • Strong finish to the year with good retention and new business secured despite Revenue +10.3% persistent price reduction pressures • Office Products cluster benefitted from phenom
Slide 19: Automotive CEO: Carla Seppings
Automotive CEO: Carla Seppings • Disappointing result in a very competitive vehicle market Financial performance • McCarthy portfolio not aligned to current demand trends Revenue +0.6% • New vehicle sales 8% lower; used vehicle sales 1% higher R25.1bn • Initiatives to expand aftermarket activity Tra
Slide 20: Financial Services CEO: Hannah Sadiki
Financial Services CEO: Hannah Sadiki • Turnaround momentum continued Financial performance • Core trading profit +53% and investment income down Revenue -7.8% • Bidvest Bank turned around its performance • Supported by higher interest rates, favorable funding mix R2.5bn • Pleasing client growth acr
Slide 21: Adcock Ingram CEO: Andy Hall
Adcock Ingram CEO: Andy Hall • Bidvest shareholding 64.8% Financial performance • Revenue → mix +2%; price +5%; organic volumes less than 1% Revenue +5.6% • Gross margin pressure, forex and mix driven R9.6bn • Operating expenditure well controlled Trading profit +5.0% • HEPS and DPS +10% • Final div
Slide 22: Strategy & outlook
Strategy & outlook
Slide 23: This is us - FY25
This is us - FY25 Our vision: Turning ordinary companies into extraordinary performers, delivering strong and consistent shareholder returns in the process, while understanding that people create wealth, FY2025 companies only report it • Decision taken to exit banking Principles Structure Strategy s
Slide 24: Our value proposition
Our value proposition Set out in ESG Framework: to drive stakeholder capitalism and sustainable value creation FY2024 Commitments Objectives Targets • Females 43% overall; Preserve empowering Inclusive employer with females at all levels making up 45%, 38% at management Conduct decentralised and Afr
Slide 25: The Outlook
The Outlook • Group portfolio and strategy aims to • Deliver a resilient recurring base; and • Capitalise on global mega trends, locally and internationally • Product, service and geographic diversity remain key strengths as multiple social and economic shifts play out • Undertone of positive sentim
Slide 26: Appendices
Appendices
Slide 27: Services International
Services International Looking ahead • Respectable organic result boosted by the acquisition of: • Consolidated – added scale and geographic coverage in Australia • Exciting new business wins • RHS – geographic expansion of hygiene services into Singapore • Intense focus on customer experience • Nic
Slide 28: Freight
Freight Looking ahead Bidvest Tank Terminals • Pleasing increase in volumes (6%) → strong gas demand, chemicals, fuels up but base oil down • Butane spheres and new multi-storage tanks will • Commissioned spheres tanks increased LPG handling and storage capacity add to growth in profitability • Mult
Slide 29: Commercial Products
Commercial Products Looking ahead Trade • Extraordinary renewable sales to consumers did not repeat. Commercial demand remains robust • Innovation and product enhancement across multiple businesses should be beneficial • Project work in Cabstrut and Voltex MVLV resulted in strong profit growth. Mome
Slide 30: Services South Africa
Services South Africa Looking ahead • Increased sales across nearly all operating companies • Margin pressure in commoditised services • Commoditised services under price pressure Security and Aviation • Competitor activity increasing in security area • Pleasing new business growth in Bidvest Protea
Slide 31: Branded Products
Branded Products Looking ahead Data, Print and Packaging • Lithotech, Rotolabel, S&N Labels, Sprint delivered strong results. Significant opportunity for Green Home • Investments in IT capability and to capitalise on sustainability awareness infrastructure underway to improve • Packaging operations
Slide 32: Automotive
Automotive Looking ahead • McCarthy new vehicle market share declined • New imported vehicle brands continue to disrupt the market. Some of these brands now included • SA vehicle market to remain under pressure. in McCarthy portfolio New brand representation expected to contribute positively to McCa
Slide 33: Financial Services
Financial Services Looking ahead Bidvest Bank • Strong net interest income growth driven by growth in the loan book and higher interest rates • Disposal process of Bidvest Bank and • Modest non-interest revenue growth impacted by flattish leasing book despite better forex result FinGlobal kicked off