Hudaco Industries Limited · JSE:HDC
Hudaco Industries — H1 2026 Earnings Presentation
40 slides from Hudaco Industries's earnings presentation, July 2026
Slide 1: Hudaco IAS interim presentation for the six months ended 31 May 2026
Hudaco IAS interim presentation for the six months ended 31 May 2026 Hudaco IAS interim presentation for the six months ended 31 May 2026
Slide 2: Agenda
Agenda o Reflecting on H1 o Discontinued operations o Results of continuing operations for H1 o Business model o Reporting segments o Operating profit and margin o Financial review o Outlook 2
Slide 3: Reflecting on H1
Reflecting on H1 o Very tough trading conditions o Another increasingly challenging six months - low business and consumer confidence - crisis in the Middle East - elevated fuel prices, making their way into pricing - soaring inflation - higher interest rates o The positive momentum experienced at t
Slide 4: Discontinued operations – Alternative energy
Discontinued operations – Alternative energy o In 2022 and 2023 we capitalised on the load-shedding period and stocked up for a bumper 2024 o In March 2024, when load-shedding ended unexpectedly, we were overstocked, but we believed there was still a place for Hudaco in alternative energy to meet de
Slide 5: Discontinued operations – Battery bay management and battery service business
Discontinued operations – Battery bay management and battery service business o When we bought Eternity Technologies, and for a few years thereafter, the business model made sense o The low-margin, labour-intensive business was offset by the higher-margin product-sales business o But then, many year
Slide 6: Results of continuing operations for H1
Results of continuing operations for H1 Gross Operating Attributable Turnover profit margin profit earnings 9,5% to from 11,2% to 0,4% to R4,2bn 38,3% to R485m R278m 38,0% Headline Comparable Interim Cash earnings per earnings per dividend per generated from share share share operations 0,3% to 12,4
Slide 7: The business model
THE BUSINESS MODEL THE BUSINESS MODEL
Slide 8: The Hudaco business model
The Hudaco business model o Hudaco’s main business is the importation and distribution of high-quality branded automotive, industrial and electronic consumable products o The concept of “value-added distribution” is key to our business model o Agency agreements generally restrict our activities to A
Slide 9: Features of value-added distribution
Features of value-added distribution o Focused business units with Inventories R2 644m Receivables R1 403m application advice o Instant availability o 30 000 active customers o Technical specification o 31 warehouses o Generally low-value and product knowledge transactions – low o Training o 800 int
Slide 10: Reporting segments
REPORTING SEGMENTS REPORTING SEGMENTS
Slide 11: Contribution by segment
Contribution by segment Contribution by segment 2025 Contribution to H1 2026 operating profit 53% (before shared services and head office) 47% 55% 45% Consumer-related products Engineering consumables 11
Slide 12: Consumer-related products
Consumer-related products The consumer-related products segment imports and distributes branded products driven by consumer spending and generally sold to installers Consumer-related products (12 businesses) o Automotive aftermarket products o Power tools and fasteners o Data networking equipment o
Slide 13: Segment results | Consumer-related products
Segment results | Consumer-related products Turnover Op margin Operating profit Rm 2026 % ch 2025 2026 2025 2026 % ch 2025 Operations 18+ months in 1 785 2,7 1 738 13,2 12,5 236 8,8 217 group Segment total 1 785 2,7 1 738 13,2 12,5 236 8,8 217 o Our data networking (MiRO) and CADAC businesses had go
Slide 14: Engineering consumables
Engineering consumables The engineering consumables segment imports and distributes branded products that are generally used in the repair and maintenance of machines Engineering consumables (21 businesses) o Bearings, belting and power transmission o Diesel engines and spares o Electrical power tra
Slide 15: Segment Results | Engineering Consumables
Segment Results | Engineering Consumables Turnover Op margin Operating profit Rm 2026 % ch 2025 2026 2025 2026 % ch 2025 Operations 18+ months in 2 126 2,4 2 077 11,5 11,5 244 2,1 239 group Acquisitions after Dec 2024 313 39 15,0 12,8 47 5 Segment total 2 439 15,3 2 116 11,9 11,5 291 19,3 244 o Acqu
Slide 16: Combined segment results
Combined segment results Turnover Op margin Operating profit Rm 2026 % ch 2025 2026 2025 2026 % ch 2025 Consumer-related products 1 785 2,7 1 738 13,2 12,5 236 8,8 217 Engineering consumables 2 439 15,3 2 116 11,9 11,5 291 19,3 244 Head office, shared services (12) (7) (42) (25) and eliminations Tot
Slide 17: Operating profit and margin
OPERATING PROFIT AND MARGIN OPERATING PROFIT AND MARGIN
Slide 18: Operating profit margin
Operating profit margin 2026 2025 Margin (%) Turnover 100% 100% Gross profit 38,0% 38,3% Operating expenses 26,5% 27,0% Operating profit 11,5% 11,3% 18
Slide 19: Operating profit margin – all operations to 2025
Operating profit margin – all operations to 2025 % 14 13,9 13,5 13,0 13,0 12 12,1 12,0 11,5 10 10,6 10,9 10,8 10,4 8 6 4 2 0 2021 2022 2023 2024 2025 2026 H1 H2 19
Slide 20: Operating profit margin – continuing operations
Operating profit margin – continuing operations % 14 14,4 13,9 13,5 13,0 13,0 12 12,1 12,0 11,3 11,5 10 10,6 10,9 10,8 10,4 8 6 4 2 0 2021 2022 2023 2024 2025 2026 H1 H2 20
Slide 21: Financial review
FINANCIAL REVIEW FINANCIAL REVIEW
Slide 22: Profit
Profit Rm 2026 % ch 2025 Turnover 4 212 9,5 3 847 Operations 18+ months in group 3 899 2,4 3 808 Acquisitions after Dec 2024 313 39 Gross profit 1 602 8,7 1 474 Operating expenses 1 117 7,6 1 038 Operations 18+ months in group 1 065 3,2 1 032 Acquisitions after Dec 2024 52 6 Operating profit 485 11,
Slide 23: Profit
Profit Rm 2026 % ch 2025 Operating profit 485 11,2 436 Fair value adjustments (time value of money) 4 7 Net interest on funding 19 17 Imputed interest on leases 35 43 Profit before tax and vendor liability adjustment 427 15,7 369 Taxation 116 100 (Rate 2026:27,2% 2025:27,1%) Profit after taxation 31
Slide 24: Comparable earnings
Comparable earnings Rm 2026 % ch 2025 Attributable earnings 278 0,4 277 Profit on disposal of PPE, net of minority (1) (1) Headline earnings 277 0,4 276 Fair value adjustment to estimated capital amounts due (35) to vendors Non-controlling interest 5 Comparable earnings 277 12,6 246 24
Slide 25: Comparable earnings - all businesses to 2025
Comparable earnings - all businesses to 2025 R million 400 390 350 348 348 300 322 280 277 250 265 257 236 200 223 210 150 100 50 0 2021 2022 2023 2024 2025 2026 H1 H2 25
Slide 26: Comparable earnings – continuing operations from 2025
Comparable earnings – continuing operations from 2025 R million 400 401 390 350 348 348 300 322 280 277 250 265 246 257 236 200 223 210 150 100 50 0 2021 2022 2023 2024 2025 2026 H1 H2 26
Slide 27: Earnings per share and dividends
Earnings per share and dividends Cents 2026 % ch 2025 Earnings per share Comparable 978 12,4 870 Headline 978 0,3 975 Basic 979 0,1 978 Dividends per share - Interim 385 10,0 350 - Final 770 Total 1 120 Dividend cover (times by comparable earnings) 2,54 2,49 27
Slide 28: Statement of financial position
Statement of financial position Rm 2026 2025 Working capital 2 778 2 882 - Inventories 2 644 2 799 - Receivables 1 403 1 324 - Payables (1 269) (1 241) Property, plant and equipment 466 402 Right-of-use assets 355 359 Goodwill and intangibles 1 431 1 472 Tax 9 26 Net assets 5 039 5 141 o May 2025 in
Slide 29: Statement of financial position
Statement of financial position Rm 2026 2025 Equity 3 836 3 655 Net borrowings 654 957 Lease liabilities 426 425 Due to vendors 99 83 Tax 24 21 Total equity and liabilities 5 039 5 141 29
Slide 30: Working capital elements
Working capital elements In months of sales 4 3 2 1 0 H1 22 H2 22 H1 23 H2 23 H1 24 H2 24 H1 25 H2 25 H1 26 -1 -2 Inventory Payables Receivables Net W Cap One month of sales 2025 = R648m (H1) 2026 = R702m (H1) 30
Slide 31: Inventory
Inventory In month of sales 5 4 4,3 3,8 3,9 3,6 3,7 3,5 3,4 3 3,2 3,3 3,1 3,1 2 1 0 2021 2022 2023 2024 2025 2026 H1 H2 31
Slide 32: Cash flow
Cash flow Rm 2026 2025 Cash from trading 616 551 Increase in working capital (138) (92) Cash from operations 478 459 Tax paid (113) (143) Cash from operating activities of continuing operations 365 316 Cash from operating activities of discontinuing operations (24) (17) Cash from operating activitie
Slide 33: Cash flow
Cash flow Rm 2026 2025 Cash flow after investing activities 250 10 Share-based payments (44) (35) Lease payments (rent) (80) (78) Finance costs paid (35) (43) Dividends paid (233) (224) Net movement (142) (370) Foreign exchange translation (loss) gain (4) 2 Opening borrowings (508) (589) Closing bor
Slide 34: Loss from discontinued operations
Loss from discontinued operations Rm 2026 2025 Operating loss (14) (17) Cost of discontinuance (146) - Impairment of inventories (133) - Impairment of plant (3) - Retrenchment costs (10) Loss before tax (160) (17) Taxation 44 5 Loss after tax (116) (12) 34
Slide 35: Reconciliation of group operating profit
Reconciliation of group operating profit 2026 % ch 2025 Operating profit from continuing operations 485 11,2 436 Operating loss from discontinued operations (14) (17) Total operating profit 471 12,4 419 35
Slide 36: Key financial points
Key financial points o Drag of discontinued operations is behind us o Economy still keeping turnover under pressure o Gross margin slightly down but strong at 38% o Expenses very tightly managed o Cash generation is strong o Improved operating margin o Interest bill not onerous o Still have ample ca
Slide 37: Outlook
Hudaco OUTLOOK Rutherford
Slide 38: Outlook for H2 2026
Outlook for H2 2026 o Cautiously optimistic despite continued geopolitical risk and economic climate o Hudaco is resilient o We will benefit from not having discontinued operations in H2 o Acquisitions of Isotec and FloSolve were already in H2 for 2025 o Hudaco businesses to have the usual improved
Slide 39: Contact Details
Contact Details Contact Details Graham Dunford Clifford Amoils Chief executive Financial director Tel +27 11 657 5004 Tel +27 11 657 5002 grahamd@hudaco.co.za camoils@hudaco.co.za 39
Slide 40: Disclaimer
Disclaimer The preceding presentation contains forward-looking statements about the Hudaco Group’s operations and financial position. They are prepared in good faith and are based on Hudaco’s best estimates and information at the time of preparing the presentation. They are nonetheless subject to si