Imperial Logistics — Imperial Holdings — FY2016 Earnings Presentation
84 slides from Imperial Logistics's earnings presentation, 2016
Slide 1: Results Presentation for the Year Ended 30 June 2016
RESULTS PRESENTATION FOR THE YEAR ENDED 30 JUNE 2016
Slide 2: Agenda
AGENDA OPERATIONS FINANCIAL LOOKING OVERVIEW CONTEXT STRATEGY REVIEW REVIEW FORWARD 2
Slide 3: Overview
OVERVIEW REVENUE OPERATING PROFIT HEPS 8% 3% 3% R118 849 million R6 422 million 1 579 cents (Record) (Record) PER SHARE EPS & CORE EPS¹ FULL YEAR DIVIDEND CASH GENERATED BY OPERATIONS Unchanged Unchanged 1% 1 581 & 1 747 cps 795 cps R8 952 million respectively (Final 425 cps) ROIC OF 12.
Slide 4: Overview
OVERVIEW > All divisions recorded revenue growth in Rand terms > Double‐digit growth of revenue & operating profit from foreign operations 4
Slide 5: Growth Trend in Foreign Operations
GROWTH TREND IN FOREIGN OPERATIONS REVENUE* (Rm) OPERATING PROFIT* (Rm) 4 year 4 year CAGR= CAGR= 2 169 24% 27% 49 728 1 843 40 352 1 483 34 471 1 260 27 969 969 21 519 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Foreign revenue up 23% to R49.7bn (42% of group*) > Foreign
Slide 6: Overview
OVERVIEW > All divisions recorded revenue growth in Rand terms > Double‐digit growth of revenue & operating profit from foreign operations > Increase of revenue & unchanged operating profit from non‐vehicle operations 6
Slide 7: Growth Trend in Non Vehicle Operations
GROWTH TREND IN NON VEHICLE OPERATIONS REVENUE* (Rm) OPERATING PROFIT* (Rm) 4 year 4 year= CAGR= CAGR 15% 14% 47 912 44 418 41 339 33 592 2 545 2 543 27 704 2 241 1 682 1 508 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Revenue not related to Vehicles up 8% to R47.9bn (40%
Slide 8: Overview
OVERVIEW > All divisions recorded revenue growth in Rand terms > Double‐digit growth of revenue & operating profit from foreign operations > Increase of revenue & unchanged operating profit from non‐vehicle operations > Strategic disposals during the year to generate proceeds of approximately R5.2bn
Slide 9: Agenda
AGENDA OPERATIONS FINANCIAL LOOKING OVERVIEW CONTEXT STRATEGY REVIEW REVIEW FORWARD 9
Slide 10: Operating Context – Imperial Regions
OPERATING CONTEXT – IMPERIAL REGIONS South Africa (58% revenue; 64% operating profit) > Global developments (slowing global economy, ↓ commodity prices & exports; ↓ ZAR) > Structural impediments to growth: • unemployment, low skills, labour legislation & militancy • low public service competence & c
Slide 11: Operating Context – Imperial Regions
OPERATING CONTEXT – IMPERIAL REGIONS Rest of Africa (11% revenue; 14% operating profit) > Economic growth rates impacted by falling commodity demand, lower oil prices & the consequent impact on currencies & private consumption Specific RoA uncontrollable factors in F 2016 > Lower commodity prices &
Slide 12: Agenda
AGENDA OPERATIONS FINANCIAL LOOKING OVERVIEW CONTEXT STRATEGY REVIEW REVIEW FORWARD 12
Slide 13: Path to Value Creation
PATH TO VALUE CREATION > Imperial JSE Ranking • 13th in Revenue • 27th in Operating Profit • 62nd in Market Value > Burdened by • Capital intensity • Low ROE • Impact of Rand on competitiveness of ~ 27% group (VIDD) • High market shares in structurally low growth South Africa • Complexity > Major ca
Slide 14: Path to Value Creation
PATH TO VALUE CREATION > Clarify the portfolio • What businesses are we in? • What sectors do they occupy? • Disposals & acquisitions > Structure the portfolio • Sectoral grouping (i.e. similar skills / counterparties / business models / assets, etc.) • Are they discreet sectors? • Eliminate manager
Slide 15: Investment Strategy
INVESTMENT STRATEGY > Imperial strives to create long term value for stakeholders through strategic clarity, financial discipline, operational excellence & strictly defined capital allocation principles > Our investment thesis is unchanged: • We will release capital & sharpen executive focus, by dis
Slide 16: Update Disposals
UPDATE DISPOSALS > Major disposals • Announced: Regent (subject to regulatory approval), Goscor, Neska, ALS & MixTelematics • 51% (control) of 10 entities in AMH Group to a related party for R75m, subject to regulatory approval > Smaller disposals • 32 various smaller disposals in ILI, VIDD & VRRAP
Slide 17: Investment Strategy
INVESTMENT STRATEGY > Imperial strives to create long term value for stakeholders through strategic clarity, financial discipline, operational excellence & strictly defined capital allocation principles > Our investment thesis is unchanged: • We will release capital & sharpen executive focus, by dis
Slide 18: Update Investment in South Africa
UPDATE INVESTMENT IN SOUTH AFRICA Acquisitions: > 10% minority in the AMH Group for R750m, settled through issue of Imperial shares & cash > A further 14% in Midas for R113m > 100% of Teamcar, Maxifren, Fairdeal by Midas > 100% of Axnosis by Resolve > Logistics Africa acquired 70% stake in Sasfin Pr
Slide 19: Investment Strategy
INVESTMENT STRATEGY > Imperial strives to create long term value for stakeholders through strategic clarity, financial discipline, operational excellence & strictly defined capital allocation principles > Our investment thesis is unchanged: • We will release capital & sharpen executive focus, by dis
Slide 20: Update Investment in Rest of Africa
UPDATE INVESTMENT IN REST OF AFRICA Acquisitions: > 70% Imperilog Botswana > A further 10% of Imres (based in Netherlands) acquired by Logistics Africa (now 80% owned) Expansion: > Vehicle distribution agreements were concluded in 6 African countries 2016 Capex: > R416m 20
Slide 21: Investment Strategy
INVESTMENT STRATEGY > Imperial strives to create long term value for stakeholders through strategic clarity, financial discipline, operational excellence & strictly defined capital allocation principles > Our investment thesis is unchanged: • We will release capital & sharpen executive focus, by dis
Slide 22: Update Investment in Global Logistics
UPDATE INVESTMENT IN GLOBAL LOGISTICS Acquisitions: > Van den Anker by Logistics International (Netherlands) > Humberside Tail Lifts by VRRAP (UK Commercial vehicles) > 95% of Palletways for R3.0bn (£155.1m), effective on 5th July 2016 2016 Capex: > R1.1bn 22
Slide 23: Palletways Overview
PALLETWAYS OVERVIEW > Acquisition of ~95% of Palletways concluded 5th July 2016 > Enterprise value consideration R3.2bn (£162.9m): • funded by existing unutilised foreign credit facilities • acquisition acquired debt free > Leading European operator in express small consignment palletised freight ma
Slide 24: Palletways Strategic Rationale
PALLETWAYS STRATEGIC RATIONALE > Strategically aligned within Imperial’s capability set > Value accretive in medium term > Strong trading momentum & inherent organic growth potential > Strong organic volume growth in all networks, both historically (~9% CAGR) & prospectively (GDP ±4‐5%) > Margin imp
Slide 25: Investment Strategy
INVESTMENT STRATEGY > Imperial strives to create long term value for stakeholders through strategic clarity, financial discipline, operational excellence & strictly defined capital allocation principles > Our investment thesis is unchanged: • We will release capital & sharpen executive focus, by dis
Slide 26: Update Investment in Human Capital
UPDATE INVESTMENT IN HUMAN CAPITAL Organisation Effectiveness > Enterprise architecture > Executive Talent Management: objective assessment; relevant skills; leadership capability; role congruence; cost > Human Capital information systems > Values > Recent examples: • Restructuring of Logistics unde
Slide 27: Update Investment in ITC
UPDATE INVESTMENT IN ITC Information Systems > Major systems implementations: • Logistics Africa – SAP & other • Logistics International – Integration • VIDD – Dealer Management System • VRAPP – Europcar, Alert & Midas > Major development of online / social media > Developing analytics 27
Slide 28: Agenda
AGENDA OVERVIEW CONTEXT STRATEGY OPERATIONS FINANCIAL LOOKING REVIEW REVIEW FORWARD 28
Slide 29: Imperial's Two Lines of Mobility
IMPERIAL’S TWO LINES OF MOBILITY LOGISTICS VEHICLES¹ REGENT (discontinued) REVENUE REVENUE REVENUE 8% 7% 3% R47.9 billion R71.2 billion R3.1 billion 40% contribution² 60% contribution² OPERATING PROFIT OPERATING PROFIT OPERATING PROFIT Unchanged 7% 6% R2.5 billion R3.5 billion R529 milli
Slide 30: Divisional Overview
DIVISIONAL OVERVIEW Five divisions in two major lines of mobility, operating under separate management structures to enable decentralised entrepreneurial creativity within the group's clearly‐defined strategic, capital, budgetary & governance principles LOGISTICS VEHICLES VEHICLE IMPORT, VEHICLE RET
Slide 31: Imperial's Two Lines of Mobility: Logistics
IMPERIAL’S TWO LINES OF MOBILITY LOGISTICS REVENUE 8% R47.9 billion 40% contribution OPERATING PROFIT Unchanged R2.5 billion 42% contribution 4 YEAR CAGR 14% 31
Slide 32: Growth Trend Logistics South Africa
GROWTH TREND LOGISTICS SOUTH AFRICA REVENUE (Rm) OPERATING PROFIT (Rm) 4 year ‐1% 4 year ‐21% CAGR CAGR =+5% =0% 952 15 755 939 15 372 15 266 13 444 12 741 756 750 698 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Declining volumes, particularly in the industrial logistics
Slide 33: Growth Trend Logistics RoA
GROWTH TREND LOGISTICS RoA REVENUE (Rm) OPERATING PROFIT (Rm) 4 year +19% 4 year +23% CAGR CAGR =+34% =+50% 11 853 780 9 974 635 6 319 331 4 565 3 716 222 154 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Revenue & operating profit up 19% & 23% respectively: volume; pharma;
Slide 34: Growth Trend Logistics Africa
GROWTH TREND LOGISTICS AFRICA REVENUE (Rm) OPERATING PROFIT (Rm) 4 year +7% 4 year ‐4% CAGR CAGR =+13% =+14% 1 587 27 119 1 530 25 347 1 270 22 090 18 018 16 457 920 910 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Delivered revenue growth in a difficult trading environmen
Slide 35: Growth Trend Logistics International
GROWTH TREND LOGISTICS INTERNATIONAL REVENUE (Rm) OPERATING PROFIT (Rm) 4 year +9% 4 year +6% CAGR CAGR =+17% =+14% 1 013 20 793 971 958 19 249 19 071 759 15 574 598 11 247 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Revenue & operating profit in Euros declined 7% & 10% r
Slide 36: 2016 Logistics International (Euro)
2016 LOGISTICS INTERNATIONAL (EURO) REVENUE (€m) OPERATING PROFIT (€m) OPERATING MARGINS (%) ‐7% ‐10% 70 1 391 5.9% 1 298 63 5.0% 4.9% 3.9% 36 688 610 27 2015 2016 H1 2016 H2 2016 2015 2016 H1 2016 H2 2016 2015 2016 H1 2016 H2 2016 > The weakening of the Rand against the Euro assisted the Rand‐denom
Slide 37: Imperial Logistics (Total)
IMPERIAL LOGISTICS (TOTAL) REVENUE (Rm) OPERATING PROFIT (Rm) 68% foreign 71% foreign 4 year 4 year CAGR CAGR =15% =+14% 2 545 2 543 47 912 2 241 44 418 41 339 33 592 1 679 1 508 27 704 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Solid revenue growth trend > Comprised R47
Slide 38: Imperial's Two Lines of Mobility: Vehicles
IMPERIAL’S TWO LINES OF MOBILITY VEHICLES REVENUE 7% R71.2 billion 60% contribution OPERATING PROFIT 7% R3.5 billion 58% contribution 4 YEAR CAGR ‐2% 38
Slide 39: National Vehicle Sales 2007 – 2016
NATIONAL VEHICLE SALES 2007 – 2016 IMPERIAL’S SHARE OF TOTAL NAAMSA VEHICLE SALES & GDP GROWTH 800 713 9% 36 623 644 631 639 599 588 600 485 38 29 31 31 6% 530 27 29 495 Vehicle units (thousands) 430 481 491 437 441 24 454 453 26 20 409 400 3% 312 341 GDP growth (%) 200 0% 192 155 99 80 97 117 120 1
Slide 40: Imperial's Market Share vs OEMs
IMPERIAL’S MARKET SHARE VS OEMS MARKET SHARE* (%) 20.6% 19.6% 5.1% 14.1% 4.5% 16.2% 15.8% 14.3% 12.9% 12.5% 7.7% 7.4% 5.9% 5.3% Jun 15 Jun 16 Jun 15 Jun 16 Jun 15 Jun 16 Jun 15 Jun 16 Jun 15 Jun 16 Jun 15 Jun 16 Imperial Mercedes Ford Toyota Volkswagen Nissan AMH Imperial Vehicle Retail > Imperial’s
Slide 41: Divisional Review Vehicle Import, Distribution & Dealerships
DIVISIONAL REVIEW VEHICLE IMPORT, DISTRIBUTION & DEALERSHIPS REVENUE OPERATING (including inter‐segment revenue) PROFIT 4% 20% R28.5 billion R1.1 billion 41
Slide 42: Car Parc of Imperial Imported Brands
CAR PARC OF IMPERIAL IMPORTED BRANDS 1 116 939 1 037 878 956 666 865 636 769 295 669 785 290 550 576 155 192 334 487 701 431 580 373 473 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 > Car parc doubled over past 5 years & exceeded 1 million in 2015 > Provides an underpin to earnings >
Slide 43: Currency, Market Share & Operating Margins
CURRENCY, MARKET SHARE & OPERATING MARGINS MARKET SHARE¹ (%) OPERATING MARGIN² (%) 13.8% 15.4% 11.8% 16.2% 14.3% 14.1% 10.5% 10.0% 9.2% 7.3% 5.5% 6.0% Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun 11 12 13 14 15 16 11 12 13 14 15 16 Exchange rates (USDZAR) Exchange rates (EURZAR) Exchange rates (U
Slide 44: South African New Vehicle Prices
SOUTH AFRICAN NEW VEHICLE PRICES VEHICLE PRICE INCREASES (YOY GROWTH) SELLING PRICE VS CURRENCY COST NEW & PRE OWNED (%) OF IMPORTED PRODUCT (%) Y‐o‐y growth Ratio of used car sales to new car sales 2.67 2.07 1.81 1.79 1.78 1.83 1.74 1.65 1.65 1.52 0.8 0.6 6.6 7.0 7.8 1.6 7.2 1.4 7.8 1.7 6.9 1.6 6.6
Slide 45: Divisional Review Motor Related Financial Services
DIVISIONAL REVIEW Performance MOTOR RELATED > Grew revenue & operating profit by 14% & 8% respectively, FINANCIAL SERVICES despite declining new vehicle sales & increased costs incurred on IT & new products > Innovative new products & channels have improved retention & penetration rates > Funds & po
Slide 46: Total Financial Services
TOTAL FINANCIAL SERVICES OPERATING PROFIT SPLIT (Rm) NET UNDERWRITING MARGIN (%) 1362 1307 191 16.1% 15.8% 208 502 479 669 620 2015 2016 2015 2016 Investment income, including fair value adjustments Underwriting result Motor related financial products and services 46
Slide 47: Growth Trend Vehicle Import, Distribution & Dealerships
GROWTH TREND VEHICLE IMPORT, DISTRIBUTION & DEALERSHIPS (INCLUDING FINANCIAL SERVICES) REVENUE (Rm) OPERATING PROFIT (Rm) 4 year +4% 4 year +15% CAGR CAGR =+6% =‐7% 30 107 28 866 28 266 2 663 26 633 2 477 23 684 2 105 1 818 1 580 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16
Slide 48: Divisional Review Vehicle Retail, Rental & Aftermarket Parts
DIVISIONAL REVIEW VEHICLE RETAIL, RENTAL & AFTERMARKET PARTS REVENUE OPERATING (including inter‐segment revenue) PROFIT 9% Unchanged R41 billion R1.7 billion 48
Slide 49: Vehicle Retail, Rental & Aftermarket Parts Profile & 2016 Performance
VEHICLE RETAIL RENTAL & AFTERMARKET PARTS PROFILE & 2016 PERFORMANCE VEHICLE RETAIL AFTERMARKET RENTAL PARTS Profile Profile Profile > Extensive footprint of 80 passenger vehicle > Distributor, wholesaler & > Car Rental (Europcar & Tempest) dealerships representing 22 locally based OEMs retailer thr
Slide 50: Growth Trend Vehicle Retail, Rental & Aftermarket Parts
GROWTH TREND VEHICLE RETAIL, RENTAL & AFTERMARKET PARTS REVENUE (Rm) OPERATING PROFIT (Rm) 4 year +9% 4 year 0% CAGR CAGR =+9% =+7% 1 677 1 677 41 045 1 569 37 547 34 014 1 350 1 288 31 895 28 882 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Good growth of revenue from Imp
Slide 51: Growth Imperial Group Vehicles
GROWTH IMPERIAL GROUP VEHICLES REVENUE (Rm) OPERATING PROFIT (Rm) 24% foreign 4 year 4 year CAGR CAGR 11% foreign 71 152 =+8% =‐2% 66 413 62 280 58 528 4 013 52 566 3 765 3 674 3 495 3 257 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 > Represents 58% of group operating profi
Slide 52: Agenda
AGENDA OVERVIEW CONTEXT STRATEGY OPERATIONS FINANCIAL LOOKING REVIEW REVIEW FORWARD 52
Slide 53: Income Statement
INCOME STATEMENT 2015 2016 Rm Rm % CHANGE Revenue (including discontinued) 110 487 118 849 8% LOGISTICS 8% new contract gains, strong growth in RoA from acquisitions & Rand weakness assisting RoA & International, REVENUE reduced by disposals in International CONTRIBUTION PER business DIVISION (%)
Slide 54: Income Statement
INCOME STATEMENT 2015 2016 Rm Rm % CHANGE Revenue (including discontinued) 110 487 118 849 8% Operating profit (including discontinued) 6 235 6 422 3% Operating profit margin 5.6% 5.4% LOGISTICS unchanged OPERATING PROFIT new contract gains, strong growth in CONTRIBUTION PER RoA from acquisitions
Slide 55: Divisional Statistics
DIVISIONAL STATISTICS 35.4% OPERATING MARGIN (%) 32.0% 6.6% 6.3% 6.0% 5.6% 5.5% 5.4% 5.0% 4.9% 4.5% 4.1% Logistics Africa Logistics International Vehicle Import, Vehicle Retail, Financial Services Group Distribution & Rental & Dealerships Aftermarket Parts (incl financial services) 2015 2016 RETURN
Slide 56: Income Statement
INCOME STATEMENT 2015 2016 Rm Rm % CHANGE Revenue 110 487 118 849 8% Operating profit 6 235 6 422 3% Amortisation of intangible assets (415) (437) Profit on disposal of properties, net of impairments 29 28 Impairments of goodwill and other assets (64) (498) Profit on sale of businesses 15 430 Foreig
Slide 57: Income Statement
INCOME STATEMENT 2015 2016 Rm Rm % CHANGE Net financing costs (1 194) (1 440) 21 Income from associates 32 133 316 Tax (1 213) (1 229) 1 Net profit for the year 3 386 3 208 (5) Attributable to minorities (332) (159) (52) Attributable to Imperial shareholders 3 054 3 049 > Net finance costs increased
Slide 58: Balance Sheet
BALANCE SHEET 2015 2016 Rm Rm % CHANGE Property, plant & equipment 10 967 11 465 5 Transport fleet 5 610 5 953 6 Vehicles for hire 3 603 3 469 (4) Goodwill & intangible assets 7 193 7 501 4 Associates, investments & loans 1 708 1 277 (25) Other assets 1 428 1 867 31 Net working capital 9 267* 9 936
Slide 59: Balance Sheet
BALANCE SHEET 2015 2016 Rm Rm % CHANGE Total shareholders’ interest 19 233 19 802 3 Net interest bearing borrowings (ignoring Regent cash) 14 327 16 520 13 Other liabilities 8 121 8 584 6 Liabilities directly associated with assets classified as held for sale 2 713 3 114 15 Equity & liabilities 44 3
Slide 60: Cash Flow – Operating Activities
CASH FLOW – OPERATING ACTIVITIES 2015* 2016 Rm Rm % CHANGE Cash generated by operations 9 049 8 952 (1) Net working capital movements 9 (828) (excludes currency movements & net acquisitions) Interest & tax paid (2 481) (3 371) 36 Cash flow from operating activities before rental assets capex 6 577 4
Slide 61: Cash Flow – Investing Activities
CASH FLOW – INVESTING ACTIVITIES 2015 2016 Rm Rm % CHANGE Net acquisition & disposals of subsidiaries & businesses (938) 760 Capital expenditure (2 988) (2 527) (15) Expansion (1 743) (1 130) Replacement (1 245) (1 397) Net movement in associates & JVs 178 71 Net movement in investments, loans & oth
Slide 62: Cash Flow – Summary
CASH FLOW – SUMMARY 2015 2016 Rm Rm % CHANGE Cash flow from operating activities 5 046 3 142 (38) Total investing activities (from previous slide) (4 951) (1 726) (65) Financing activities Dividends paid (1 724) (1 909) Other financing activities (273) (1 164) Increase in net borrowings (1 657) (1 9
Slide 63: Gearing
GEARING Net debt to equity > Higher net debt to fund: • weaker exchange rate for the translation of the foreign debt into Rand • capital expenditure • working capital requirements 79% • acquisitions 76% 73% > Net debt to equity at 73% improved 66% 60% 62% from 76% at December 2015 but was 51% higher
Slide 64: Returns
RETURNS ROE (%) ROIC vs WACC (%)* 17.2 20 14.7 19 13.1 17 12.4 16 10.2 9.02 9.4 9 2013 2014 2015 2016 2013 2014 2015 2016 ROIC WACC ROE affected by: ROIC affected by: > Attributable profits unchanged > lower returns from reduced earnings > Equity up on prior year > invested capital increased due to:
Slide 65: Agenda
AGENDA OVERVIEW CONTEXT STRATEGY OPERATIONS FINANCIAL LOOKING REVIEW REVIEW FORWARD 65
Slide 66: Structural Changes
STRUCTURAL CHANGES > From F 2017, the newly created Logistics & Vehicles divisions will be reported on as single entities > The Logistics division will provide full segmental detail on 3 sub‐divisions, namely: • Logistics South Africa; • Logistics Rest of Africa; and • Logistics International > The
Slide 67: F 2017 Environment
F 2017 ENVIRONMENT Economy > We see no reason for a marked improvement in the economies where we operate during F 2017 Trading conditions > We expect: • competitors & counterparties to be aggressive in slow growth conditions • volume growth throughout our logistics operations to be subdued • nationa
Slide 68: Guidance
GUIDANCE > These uncontrollable factors make forecasting challenging but the expected sub‐ divisional segmental performance is as follows: > Logistics division • South Africa: Growth of revenues & operating profit • Rest of Africa: Growth of revenues & a decline in operating profit • International:
Slide 69: Thank You
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Slide 70: Annexures
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Slide 71: Divisional Profile Logistics Africa
DIVISIONAL PROFILE > An experienced provider of end‐to‐end logistics & integrated supply LOGISTICS AFRICA chain management services in Southern, West & East African markets through three regional hubs (See Addenda) > Across sub‐Saharan Africa, the division provides a comprehensive & integrated deman
Slide 72: Integrated Supply Chain Partner in South Africa
INTEGRATED SUPPLY CHAIN PARTNER IN SOUTH AFRICA DEMAND‐DRIVEN FREIGHT & MANAGED WAREHOUSING SUPPLY CHAIN ROUTE‐TO‐MARKET TRANSPORT LOGISTICS & DISTRIBUTION INTEGRATION FULFILLMENT > Dedicated fleets > Continuous flow > Product focused > Agency & > Advisory services > Specialised vehicles management
Slide 73: Logistics & Distribution in Rest of Africa
LOGISTICS & DISTRIBUTION IN REST OF AFRICA Imperial provides a comprehensive & integrated demand‐driven route‐to‐market for consumer products & pharmaceutical brand owners in sub‐Saharan Africa GET YOU THERE SELL YOUR PRODUCT BUILD YOUR BRAND A B SUPPLY CHAIN MANAGED LOGISTICS WAREHOUSING ROUTE‐TO‐M
Slide 74: Imperial Logistics Africa
IMPERIAL LOGISTICS AFRICA West Africa > Imperial Health Sciences – pharma logistics, supply chain management, warehousing > MDS Logistics – transport, distribution, warehousing (FMCG, pharma, telecoms) > Eco Health – distribution, sales, marketing of pharma MALI products NIGER NORTH SUDAN > Imres –
Slide 75: Divisional Profile Logistics International
DIVISIONAL PROFILE > Estimated market size of €663bn in Imperial International ‘s sectors in LOGISTICS Europe (IPL ranked 12th) INTERNATIONAL > Industry structure: Highly developed infrastructure; fragmented & competitive market, process & technology driven clients Europe: Germany (mainly), Netherla
Slide 76: Logistics International Geographies
LOGISTICS INTERNATIONAL GEOGRAPHIES > Germany is the base > Strategy to follow customers/products to new markets > South America • profitable 10 year contract operating on Rio Parana, transporting iron ore, soya & lime from Brazil to Argentina • utilises five push boats with 60 barges redeployed fro
Slide 77: Palletways Competitive Set in UK, Italy & Iberia
PALLETWAYS COMPETITIVE SET IN UK, ITALY & IBERIA Number of pallets per year by pallet network, 2014 (#m pallets) United Kingdom Italy # hubs # hubs 4.6 4 1.6 3 3.5 6 1.2 5 3.0 1 0.6 7 2.5 2 Iberia 2.5 1 1.8 1 0.5 2 1.8 1 0.3 1 0.9 2 0.2 1 Source: Palletways; Transport Intelligence; Association of Pa
Slide 78: Palletways Footprint & Growth Platform
PALLETWAYS FOOTPRINT & GROWTH PLATFORM Track record of consistent and strong historical growth, with a clearly defined strategic plan > Fast growing addressable market ‐ express pallet Livingston networks forecast to increase penetration rate Leeds > Organic growth through: Fradley central Head Offi
Slide 79: Divisional Profile Vehicle Import, Distribution & Dealerships
DIVISIONAL PROFILE > Strategy: Increase sustainable market share & car parc VEHICLE IMPORT, of major brands through dedicated & multi‐franchise DISTRIBUTION & DEALERSHIPS customer focussed dealerships; capture revenue & margin across entire motor value chain (import, distribution, retail, after‐sale
Slide 80: Imperial Group Revenue Capture
IMPERIAL GROUP REVENUE CAPTURE 6. Pre Owned vehicle sales 1. Vehicle import & distribution > ±70 000 units p.a. > Represent 16 exclusive Automotive & Industrial brands > Strong after sales & service capability 2. Vehicle retail 5. Aftermarket Parts > Most major local & imported brands > Parts, oils
Slide 81: Divisional Review Vehicle Retail, Rental & Aftermarket Parts
DIVISIONAL REVIEW VEHICLE RETAIL, RENTAL > Industry structures: Mature, highly competitive & price sensitive car rental sector dominated by local & AFTERMARKET PARTS franchises of major international brands; Aftermarket Parts industry mature but stable, based on 10 million vehicles in the vehicle pa
Slide 82: Divisional Review Motor Related Financial Services
DIVISIONAL REVIEW > Motor related financial services remains an integral part of Imperial’s strategic MOTOR RELATED focus on the full automotive value chain FINANCIAL SERVICES > Provides maintenance & warranty products associated with the automotive market > Strategy: Leverage Imperial’s capabilitie
Slide 83: Divisional Review Regent
DIVISIONAL REVIEW REGENT > Provides regulated life & short term insurance products & services mainly in South Africa, Lesotho & Botswana (Held for sale) > The disposal of Regent has been approved by the Botswana competitions authorities. Conclusion of the transaction is now subject to regulatory app
Slide 84: Disclaimer
DISCLAIMER Certain statements made in this presentation constitute forward‐looking statements. Forward‐looking statements are typically identified by the use of forward‐looking terminology such as ‘believes’, ‘expects’, ‘may’, ‘will’, ‘could’, ‘should’, ‘intends’, ‘estimates’, ‘plans’, ‘assumes’ or