Calgro M3 Holdings Limited · JSE:CGR
Calgro M3 — H1 2022 Earnings Presentation
38 slides from Calgro M3's earnings presentation, Aug 31, 2021
Slide 1: Results Presentation
Results Presentation For the six months ended 31 August 2021 #sustainableactions www.calgrom3.com
Slide 2: Agenda
Agenda Belhar – Western Cape 1. Period in perspective 2. Business update 3. Financial review 4. The future 5. Appendix 2
Slide 3: Period in Perspective
1 PERIOD IN PERSPECTIVE
Slide 4: #sustainableactions
#sustainableactions #sustainableactions Continued implementation of: Optimal capital allocation Increase open market sales and complete opportunities in Residential Property Development business Grow market share and sales through product enhancement and increase footprint of Memorial Parks business
Slide 5: Overview of the period
Overview of the period Performance Highest in 4 years Private sector open Drive efficiencies Gross profit margin market sales up more Revenue up 45.6% and costs down increased to 19.7% than 100% Aug 2020: (26.29) cps Headline earnings NAV increased to Nett interest down Administrative cost per share
Slide 6: Strategic achievements
Strategic achievements UNGC advanced level status Bridge City - KZN Retention of ISO 14001:2015 & ISO 45001:2018 certification Execution of short-to-medium term strategic goals Significant margin improvement, efficiency gains & improved debt to equity Level 1 B-BBEE No invasions or damage during rec
Slide 7: Building legacies. Changing lives
Building legacies. Changing lives “A man is not a man until he has a house of his own” Nelson Mandela 7
Slide 8: Business Update
2 BUSINESS UPDATE
Slide 9: Improved diversification
Improved diversification Revenue Total cash receipts generated Memorial Parks from Memorial Parks 7% R39.4 million, sufficient to cover Group’s administrative expenses R36 million during the period Objective: grow cash receipts from Memorial Parks to support all Residential Group overheads and inter
Slide 10: Integrated Residential Developments
Integrated Residential Developments ▪ Operational in Gauteng and Western Cape while South Hills - Gauteng trading out KZN ▪ Revenue increased 44.9% - R 545 million ▪ 771 opportunities handed over ▪ Increase GP margin to 17.5% ▪ Target GP margin to return above 20% ▪ Target six distinct income groups
Slide 11: Residential Property Developments
Residential Property Developments Opportunities Opportunities under Total available 771 5 091 32 590 handed over development opportunities in pipeline Total segment revenue (Aug 2021) R’000 ▪ 9 projects in the ground 43 985| 8% ▪ 7 of these generating cash 163 444| 30% 146 348| ▪ 5 091 units under c
Slide 12: Scale and activity
Scale and activity Fleurhof - Gauteng Witpoortjie - Gauteng South Hills - Gauteng Increased opportunities in these three developments to >3 900
Slide 13: Memorial Parks
Memorial Parks Durbanville – Western Cape Fourways - Gauteng Nasrec - Gauteng 13
Slide 14: Memorial Parks
Memorial Parks Durbanville – Western Cape 14
Slide 15: Memorial Parks
Memorial Parks Fourways - Gauteng ▪ Operational in Gauteng, Western Cape and Free State ▪ Total cash receipts increased by 52,7% to R39.4 million ▪ Revenue increased by 58.2% to R30.5 million ▪ Increased GP margin to 59,5% ▪ On target GP margin ▪ Four parks producing revenue 15
Slide 16: Memorial Parks: Future focus
Memorial Parks: Future focus ▪ New entry level product introduced at R13,000 Durbanville – Western Cape ▪ Increased Gauteng market share ▪ Not margin dilutive ▪ Partnership with Nedbank concluded ▪ Loan facility for clients to purchase graves ▪ National roll-out and development of further land parce
Slide 17: Financial Review
3 FINANCIAL REVIEW
Slide 18: Financial summary
Financial summary Revenue (R’000) & Earning/(loss) per share Cash generated from GP margin (%) (cents) operations (R’000) 133 171 39.56 576 214 395 829 19,7% HY 2020 115 662 HY 2020 HY 2021 HY 2021 7,9% -30.46 HY 2020 HY 2021 HY 2020 HY 2021 Ensure strong cash and Drive to sustain sales and diligent
Slide 19: Statement of Cashflows
Statement of Cashflows Unaudited Unaudited Audited Feb Aug 2021 Aug 2020 2021 Cash generated from operating activities Cash generated from operations 133 171 115 662 114 768 Finance income received 1 273 4 512 7 577 Finance cost paid (45 008) (60 552) (107 474) Tax paid (11 898) (13 654) (17 878) Ne
Slide 20: Statement of Cashflows (continued)
Statement of Cashflows (continued) Unaudited Unaudited Audited Feb Aug 2021 Aug 2020 2021 Cash flows repaid in financing activities Proceeds from borrowings - - 396 000 Repayment of borrowings (20 000) (38 000) (403 000) Shares bought back - - (14 175) Repayment of capital portion of leases (1 439)
Slide 21: Covenants
Covenants 31 Aug 2021 28 Feb 2021 31 Aug 2020 28 Feb 2020 Net debt to equity ratio 0.84 0.99 1.04 1.04 Debt service cover ratio 4.63 1.40 3.69 1.93 Nasrec - Gauteng Date Target Maximum allowed net debt: equity By 28 February 2022 0.90:1 ratio for the Group is 1.5 : 1 By 28 February 2023 0.80:1 Minim
Slide 22: Segmental revenue contribution
Segmental revenue contribution Revenue Unaudited interim period Unaudited interim period (R’000) 31 August 2021 31 August 2020 Residential Property Development 545 758 376 578 Memorial Parks 30 456 19 251 Total 576 214 395 829 Witpoortjie - Gauteng 22
Slide 23: Residential project contributions
Residential project contributions (to Residential Property Development segment) HY 2021 HY 2020 100% 3 189 90% 15 395 9 783 65 093 80% 141 748 141 369 70% 60% 50% 32 160 40% 43 985 18 514 141 308 30% 163 444 146 348 20% 10% 0% Fleurhof Jabulani Witpoortjie South Hills Belhar Third parties 23
Slide 24: Statement of Comprehensive Income
Statement of Comprehensive Income Revenue Unaudited Unaudited Audited 31 August 2021 31 August 2020 year ended 28 February 2021 Revenue 576 214 395 829 879 147 Cost of sales (462 817) (364 572) (771 124) Gross profit 113 397 31 257 108 023 Other income 10 662 3 728 50 631 Administrative expenses (36
Slide 25: Statement of Comprehensive Income (Continued)
Statement of Comprehensive Income (Continued) Revenue Unaudited Unaudited Audited 31 August 2021 31 August 2020 year ended 28 February 2021 Profit/(loss) after taxation 47 875 (39 109) 18 479 Total comprehensive income 47 875 (39 109) 18 479 Earnings per share – cents 39.56 (30.46) 14.88 Headline ea
Slide 26: Statement of Financial Position – Assets
Statement of Financial Position – Assets Assets Unaudited Audited Feb Unaudited Aug 2021 2021 Aug 2020 Non-current assets Investment property 19 947 19 947 13 834 Property, plant and equipment 22 071 22 501 24 758 Intangible assets 159 651 159 651 159 651 Investments 13 027 13 027 12 549 Investments
Slide 27: Statement of Financial Position – Equity and Liabilities
Statement of Financial Position – Equity and Liabilities Equity and Liabilities Unaudited Audited Unaudited Aug 2021 Feb 2021 Aug 2020 Total Equity 877 646 828 057 782 081 Non-current liabilities 200 444 208 617 211 004 Current liabilities Borrowings 925 274 944 162 1 025 479 Current income tax liab
Slide 28: Borrowing maturities
Borrowing maturities Detail Rand (R’000) Opening balance 1 March 2021 (gross) 958 000 New debt - Maturity Rand Maturity Rand profile (R’000) profile (R’000) Debt repaid (20 000) FY 2022 48 700 FY 2025 211 750 Closing balance – 31 August 2021 938 000 FY 2023 233 500 FY 2026 107 500 FY 2024 282 800 FY
Slide 29: Looking Forward
4 LOOKING FORWARD
Slide 30: What does Calgro M3 have to work with?
What does Calgro M3 have to work with? ▪ Housing shortage remains high ▪ Interest rate low and to remain low for a period of time ▪ 66,5% housing market in Gauteng and Western Cape ▪ Public sector budgets to increase ▪ Strong pipeline to capitalise on ▪ Strong demand for dignified and secure burial
Slide 31: Take away – what lies ahead?
Take away – what lies ahead? ▪ Well positioned to capitalise on market demand ▪ Liquidity to remain conservative ▪ Higher cash balances ▪ Sale of non-core assets and rental property ▪ Utilisation of proceeds: ▪ Further settlement of debt ▪ Free-up working capital and retain higher cash balance ▪ Sha
Slide 32: Thank you
Thank you Available on website: Wikus Lategan (CEO) Email: wikus@calgrom3.com ▪ 2021 Unaudited condensed Waldi Joubert (FD) Email: waldi@calgrom3.com consolidated interim financial results for Sayuri Naicker (FD incumbent) Email: sayurin@calgrom3.com the six months ended 31 August 2021 ▪ Video of Ca
Slide 33: Disclaimer
Disclaimer Calgro M3 has acted in good faith and has made every reasonable effort to ensure the accuracy and completeness of the information contained in this presentation, including all information that may be defined as 'forward- looking statements'. Forward-looking statements may be identified by
Slide 34: Appendix
5 APPENDIX
Slide 35: Integrated Residential Developments: Future focus
Integrated Residential Developments: Future focus What we said (May 2021) Status ▪ Two provinces: Gauteng and Western Cape Completed ▪ Sale of what is now considered to be non-core projects In progress ▪ Meticulous capital allocation to high-yielding projects Completed ▪ Consistent monthly hand-over
Slide 36: Business model
] Business model Identify project and (4) due diligence @) Secure land Township (3) establishment Top structure planning and design (5) Infrastructure (outsourced) (6) Marketing and sales Transfer to end-user (erven for houses Residential and bulk deals) Property (8) Construction (outsourced) Develo
Slide 37: Business model
. ee Business model CALGRO M3 Group Land identified/ Memorial a acquisition Parks Landscaping and infrastructure development (outsourced) Value is created through operating in strategic locations and providing superior products and customer service Marketing e and sales e Holistic burial and remembr
Slide 38: Board composition
] Board composition a Board composition @ Executive Non-Executive @ ® 6 Directors Director CHD @ wrsam Q me a 4) Checions Chairperson Lead | Me Qs" & Gender CALGRO M3 Group Race ww Black Indian l | i: I Write Tenure Otolyear 1ioSyeas Sto 1Oyears 10+ years | l l | Average: 6 years