Motus Holdings Limited · JSE:MTH
Motus — FY2023 Earnings Presentation
51 slides from Motus's earnings presentation, June 2023
Slide 1: Annual results presentation
Annual results presentation summarised consolidated results for the year ended 30 June 2023
Slide 2: Agenda
Agenda 1 7 Revenue streams & 13 Health of the motor industry 2023 highlights contribution per segment in South Africa 2 8 Operating profit 14 Value creation platform Defensive strategies contribution per segment 3 Key focus areas for business 9 15 Financial highlights Prospects growth & sustainabili
Slide 3: 2023 highlights
Osman Arbee Ockert Janse van Rensburg 2023 highlights Strong financial Shareholder performance Acquisition of returns Motor Parts Direct ESG (Holdings) Limited highlights (MPD) Acquisition of Revenue up 16% Mercedes Benz ROIC of 14,1% to R106 billion dealerships >WACC of 10,7% Acquired a Achieved EB
Slide 4: Value creation platform
Osman Arbee Ockert Janse van Rensburg Value creation platform Business Innovation & Stakeholder Governance Our model digitisation relationships people Our diversified integrated Our ability to adapt & Our enduring & We conduct business Our people continue business model offers a innovate, specifical
Slide 5: Key focus areas for business growth & sustainability
Osman Arbee Ockert Janse van Rensburg Key focus areas for business growth & sustainability To further enhance the sustainability of the Group, we are pursuing three key strategies: 1. Increased diversification to place less reliance on revenue & profits generated directly from vehicle sales. 2. Incr
Slide 6: Strategic acquisitions
Osman Arbee Ockert Janse van Rensburg Strategic acquisitions The group acquired the following businesses since 1 July 2022 for a total purchase consideration of R4,7 billion: Effective Purchase Acquisition Segment Transaction Date consideration Diversification Internationalisation Aftermarket Busine
Slide 7: Significant acquisitions since July 2022
Osman Arbee Ockert Janse van Rensburg Significant acquisitions since 1 July 2022 MPD MB retail dealerships Rationale: Rationale: − aligned to Motus’ international growth strategy for the − strategic acquisition to enhance Motus’ South African Aftermarket Parts segment; portfolio in the luxury segmen
Slide 8: The South African vehicle market
Osman Arbee Ockert Janse van Rensburg The South African vehicle market Motus sells one in five Actual Actual Projection Actual new vehicles in South Africa 464k 529k 520k-540k 541k new vehicles new vehicles new vehicles new vehicles Motus sells Motus targets 1 new vehicle to pre-owned vehicles CY21
Slide 9: Vehicle unit sales
Osman Arbee Ockert Janse van Rensburg Vehicle unit sales 8% % Units 2023 2022 change 17% New 126 826 135 564 (6) % new − SA 95 418 104 638 (9) vehicles sold 2023 − UK 21 698 21 405 1 − Australia 9 710 9 521 2 Pre-owned 85 752 89 753 (4) 75% − SA 64 963 68 695 (5) − UK 15 798 16 400 (4) 6% − Australi
Slide 10: Revenue streams
Osman Arbee Ockert Janse van Rensburg Revenue streams % Revenue contribution per stream Rm 2023 2022 change Sale of new vehicles 49 472 43 746 13 Sale of pre-owned vehicles 23 327 21 353 9 Sale of parts 22 618 17 240 31 47% 48% Rendering of services 10 904 9 639 13 Total revenue 106 321 91 978 16 Re
Slide 11: Revenue contribution per segment
Osman Arbee Ockert Janse van Rensburg Revenue contribution per segment % Rm 2023 2022 change Revenue 106 321 91 978 16 2% 10% 20% Segmental +3% +14% +9% +52% revenue^ June 2023 68% 2% 8% 22% Segmental revenue^ June 2022 23 883 24 596 74 209 84 404 2 107 2 291 8 163 12 406 68% Import and Distribution
Slide 12: Operating profit contribution per segment
Osman Arbee Ockert Janse van Rensburg Operating profit contribution per segment % Rm 2023 2022 change Operating profit before capital items and net foreign exchange gains 5 723 5 029 14 17% 41% 19% Segmental -6% +16% +14% +62% operating profit^ June 2023 23% 12% 41% 19% Segmental operating profit^ J
Slide 13: Financial highlights
Osman Arbee Ockert Janse van Rensburg Financial highlights Revenue 16% EBITDA 19% Operating profit 14% R106 321 million R8 083 million R5 723 million (2022: R91 978 million) (2022: R6 785 million) (2022: R5 029 million) Profit before tax 3% Attributable profit 2% R4 357 million R3 354 million (
Slide 14: Financial highlights (cont.)
Osman Arbee Ockert Janse van Rensburg Financial highlights (cont.) Earnings 6% Headline earnings 1% Total dividend per share per share per share 2 008 cents 2 046 cents 710 cents per share per share per share (2022: 1 902 cents per share) (2022: 2 025 cents per share) Interim dividend 300 cents pe
Slide 15: Financial highlights (cont.)
Osman Arbee Ockert Janse van Rensburg Financial highlights (cont.) Cash generated by operations Return on Weighted average before changes in invested capital1 cost of capital1 net working capital R7 837 million 14,1% 10,7% (2022: R6 909 million) (2022: 17,8%) (2022: 10,9%) Free cash flow Net debt EB
Slide 16: Financial overview
Osman Arbee Ockert Janse van Rensburg Financial overview Extracts from Statement of Profit or Loss for the year ended 30 June 2023 % Rm 2023 2022 change Revenue 106 321 91 978 16 Earnings before interest, taxation, depreciation and amortisation 8 083 6 785 19 Operating profit before capital items an
Slide 17: Financial overview (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Extracts from Statement of Profit or Loss for the year ended 30 June 2023 (cont.) % Rm 2023 2022 change Operating profit before capital items and net foreign exchange gains 5 723 5 029 14 Profit/(losses) on disposal of property, plant
Slide 18: Financial overview (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Extracts from Statement of Profit or Loss for the year ended 30 June 2023 (cont.) % Rm 2023 2022 change Profit before tax 4 357 4 473 (3) Income tax expense (947) (1 135) (17) Profit for the year 3 410 3 338 2 Attributable to non-contr
Slide 19: Earnings & dividends for the year
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Earnings & dividends for the year ended 30 June 2023 % 2023 2022 change Earnings (Rm) 3 354 3 290 2 Headline earnings (Rm) 3 416 3 504 (3) Weighted average number of shares (millions) 167 173 (3) Basic earnings per share (cents) 2 008
Slide 20: Key Profit or Loss highlights
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Key Profit or Loss highlights (Rm) (Rm) Revenue EBITDA +16% +19% 106 321 87 205 4 806 4 082 8 083 5 302 91 978 6 785 73 417 79 711 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 Impacted by the COVID-19 crisis. 20
Slide 21: Key Profit or Loss highlights (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Key Profit or Loss highlights (cont.) (Rm) (Rm) Operating Attributable profit profit +14% +2% 306 3 354 2 098 3 290 1 868 3 838 5 029 3 620 5 723 2 136 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 Impacted by the COVID-19 crisis.
Slide 22: Business segment overview - Import and Distribution
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Import and Distribution % change 2023 2022 2022 HY1 2023 HY2 2023 audited audited audited Revenue (Rm) 12 603 11 993 24 596 23 883 3 Operating profit (Rm) 686 730 1 416 1 508 (6) Operating margin (%) 5,4 6,1
Slide 23: Import and Distribution (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Import and Distribution (cont.) Channel sales split Forward cover 10% 13% Our importers have the following forward cover: − Euro: to April 2024 at average rates of 2023 2022 R19,75. − US Dollar: to March 202
Slide 24: Business segment overview - Retail and Rental
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Retail and Rental % change 2023 2022 2022 HY1 2023 HY2 2023 audited audited audited Revenue (Rm) 40 746 43 658 84 404 74 209 14 Operating profit (Rm) 1 164 1 386 2 550 2 206 16 Operating margin (%) 2,9 3,2 3
Slide 25: Retail and Rental (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Retail and Rental (cont.) SA Retail: revenue & operating profit increased by 8% & 17%, Vehicle rental: revenue & operating profit increased by 26% & 12%, respectively, mainly as a result of: respectively, ma
Slide 26: Retail and Rental (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Retail and Rental (cont.) UK Retail: revenue & operating profit increased by 21% & 17%, Australia Retail: revenue & operating profit increased by 21% & 12%, respectively. respectively. − Sold 21 698 new unit
Slide 27: Business segment overview - Mobility Solutions
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Mobility Solutions % change 2023 2022 2022 HY1 2023 HY2 2023 audited audited audited Revenue (Rm) 1 157 1 134 2 291 2 107 9 Operating profit1 (Rm) 569 572 1 141 1 004 14 Comments − Revenue increased by 9% ma
Slide 28: Business segment overview - Aftermarket Parts
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Aftermarket Parts % change 2023 2022 2022 HY1 2023 HY2 2023 audited audited audited Revenue (Rm) 5 402 7 004 12 406 8 163 52 Operating profit (Rm) 406 637 1 043 644 62 Operating margin (%) 7,5 9,1 8,4 7,9 Co
Slide 29: Aftermarket Parts - South Africa
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Aftermarket Parts (cont.) South Africa Revenue & operating profit increased by 4% & 2%, respectively: − The South African parts business: − contributed positively to revenue, while operating profit remained
Slide 30: Aftermarket Parts - International
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Business segment overview - Aftermarket Parts (cont.) International Revenue & operating profit increased by greater than 100%. FAI business MPD business Asian business − Included for the full 12-month period. − Included for nine months
Slide 31: Statement of Financial Position as at June 2023
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Statement of Financial Position as at 30 June 2023 Rm % Assets 2023 2022 change Goodwill and intangible assets 6 572 1 959 >100 Investments in associates and joint ventures 277 269 3 Property, plant and equipment 8 309 7 331 13 Right-o
Slide 32: Net working capital as at June 2023
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Net working capital as at 30 June 2023 % Rm 2023 2022 change Inventories 32 302 18 966 70 Trade and other receivables 7 143 4 646 54 Derivatives 306 553 (45) Trade and other payables including provisions (25 389) (16 999) 49 Total 14 3
Slide 33: Statement of Financial Position (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Statement of Financial Position as at 30 June 2023 (cont.) Rm % Liabilities 2023 2022 change Contract liabilities (service and maintenance contracts) (3 086) (3 021) 2 Lease liabilities (3 768) (2 347) 61 Core interest-bearing debt (12
Slide 34: Statement of Cash Flows for the year ended June 2023
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Statement of Cash Flows for the year ended 30 June 2023 Rm 2023 2022 0 Cash generated by operations before changes in net working capital 7 837 6 909 Movements in net working capital (5 777) (620) Cash generated by operations before in
Slide 35: Statement of Cash Flows (cont.)
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Statement of Cash Flows for the year ended 30 June 2023 (cont.) Rm 2023 2022 0 Cash flows from operations (1 187) 2 733 Net cash outflow on the acquisitions and disposals of businesses (4 641) (633) Net capital expenditure (excluding v
Slide 36: Gearing, facilities and debt covenants
Osman Arbee Ockert Janse van Rensburg Financial overview (cont.) Gearing, facilities and debt covenants 17,9 Net debt to equity is 77% (2022: 36%) 13 712 [D:E 77%] R7,4bn R3,9bn 10,9 6,4 unutilised unutilised funding funding 6,2 7 442 facilities facilities 6 618 [D:E 60%] (including floorplans) (exc
Slide 37: ESG milestones I Social
Osman Arbee Ockert Janse van Rensburg ESG milestones I Social Management level Transformation Black representation 2018 2023 journey Top 25% 50% Group black representation of 76% Our strategy is designed to achieve Senior 33% 53% Group black DP representation of 46% high impact at two Middle 39% 52%
Slide 38: ESG milestones I Environmental
Osman Arbee Ockert Janse van Rensburg ESG milestones I Environmental Total Fuel Electricity Water >20% decrease >20% decrease >3% decrease against target against target against target (Target: 19,3 million litres) (Target: 71k kWh) (Target: 581k litres) Strong achievement Strong achievement Good ach
Slide 39: Immediate priority of reducing debt & working capital levels
Osman Arbee Ockert Janse van Rensburg Immediate priority of reducing debt & working capital levels The following strategies are being implemented: − Engage OEMs to provide flexible arrangements around ordering. − Engage OEMs for financial assistance through marketing support & “cash on the bonnet”.
Slide 40: Health of the motor industry in South Africa
Osman Arbee Ockert Janse van Rensburg Health of the motor industry in South Africa − Longest phase of money tightening since the Global Financial Crisis. − Uncertainty around future increases is compounding soft vehicle Interest rates sales. − Vehicle sales will immediately begin to improve when int
Slide 41: Defensive strategies protecting Motus from reduced vehicle sales in SA
Osman Arbee Ockert Janse van Rensburg Defensive strategies protecting Motus from reduced vehicle sales in SA − Resilient demand for parts, − Parts & workshop activity − The impact of reduced − Consistent demand for parts panel & accessories continues to generate vehicle sales, which gives from works
Slide 42: Prospects
Osman Arbee Ockert Janse van Rensburg Prospects Outlook: Consumer & Elevated Currency Increased onerous business sentiment finance costs fluctuations regulatory will remain under ongoing requirements pressure The strength of the Group lies in our agile team, integrated business model, diversificatio
Slide 43: Thank you!
We would like to thank all staff members, customers, suppliers, funders, financial institutions who provided financing to our customers, shareholders & the board members for their support during these challenging times. We thank the non-executive directors who resigned for their valuable contributio
Slide 44: Appendices
Appendices Motus
Slide 45: Our strategic priorities
Our strategic priorities Enhance Improve Ensure financial performance technology solutions market leadership & value creation Enhance financial performance Leverage existing & form new Maintain market share & & achieve our financial targets, strategic partnerships to deliver competitiveness in local
Slide 46: Resilient business model
Resilient business model 1 2 3 4 5 6 7 Diversified Integrated Unrivalled High free Varied Organic Highly automotive business scale in cash flow income growth experienced business model South Africa generation streams trajectory team 1. Diversified (non-manufacturing) business in the automotive 5. In
Slide 47: Diversified automotive business
Diversified automotive business Provider of service, 3 maintenance & extended warranty plans Importer & distributor 1 of passenger & light 8 commercial vehicles, Distributor, wholesaler & parts & panels retailer of parts & accessories Provider of fleet management 6 services Workshops, parts & servic
Slide 48: Business segment overview
Business segment overview Import and Retail and Mobility Aftermarket Distribution Rental Solutions Parts − Exclusive South African importer of − South Africa − Developer, manager & administrator − Distributor, wholesaler & retailer of Hyundai, Renault, Kia & Mitsubishi − Represent 24 OEMs & 33 brand
Slide 49: Segments
Value chain 0 0-6 1-6 >6 years years years years Pre-owned vehicle Pre-owned vehicle New vehicle market Life of new vehicle market & Trade-in market & Trade-in Importation, distribution & Recurring touchpoints after Second sale of vehicle Further vehicle servicing & first sale of vehicle, vehicle fi
Slide 50: Key business metrics
Key business metrics − New vehicle sales Retail − Service & maintenance − Number of product − Pre-owned vehicle sales − New vehicle sales contracts derivatives − Parts & panel sales − Pre-owned vehicle sales − Number of customer − Market share − Parts & panel sales contracts − Car parc − Market shar
Slide 51: Disclaimer
Disclaimer This presentation is confidential and is being provided for information purposes only to existing and prospective investors in Motus Holdings Limited (“Motus”). No representation or warranty, expressed or implied, is made as to the accuracy or completeness of the information contained her