Bidvest Group Limited · JSE:BVT
Bidvest — H1 FY2025 Earnings Presentation
30 slides from Bidvest's earnings presentation, March 2025
Slide 1: Investor Presentation for the half year ended 31 December 2024
Investor Presentation for the half year ended 31 December 2024 People and products behind a brighter future
Slide 2: Agenda
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 • Respectable result Trading profit mix - Distribution and Trading needs economic tailwinds for next growth phase • 4 divisions reported trading profit growth 12 500 • 6 acquisitions concluded added to our scale, 10 000 product and service offering 7 500 • Value-added bolt-ons
Slide 5: Highlights
Highlights • Trading profit flat at R6.3 billion • Strong balance sheet with net debt / EBITDA 2.0x • No support from macro environments and two specific • Returns remain ahead of WACC headwinds (maize exports and renewable energy sales) • ROFE 37.9% (1HFY24 40.9%) neutralised organic and acquisitiv
Slide 6: Financial Review
Financial Review
Slide 7: Financial highlights
Financial highlights Continuing operations unless specifically indicated otherwise R billion Half year ended 31 Dec 2024 Half year ended 31 Dec 2023 Change Revenue 64.5 61.1 5.7% Gross profit margin 27.6% 28.3% ↓ Expense margin 18.0% 18.1% ↓ EBITDA 7.2 7.2 0.3% Trading profit 6.3 6.3 (0.5%) Trading
Slide 8: Income Statement analysis
Income Statement analysis • Revenue +5.7% (+0.9% organic) • Growth in Services International, Services SA, Automotive and Branded Products supported by bolt-on acquisitions • New business wins and pockets of volume growth diluted by price competition • Gross profit +3.2% • Gross margin declined 66bp
Slide 9: Long-dated funding profile
Long-dated funding profile • Net debt R30.9 billion • Covenant net debt / EBITDA 2.0x stable yoy • R5.7 billion increase like-for-like since June 2024 • Offshore 5.0x post 2 bolt-on acquisitions (FY24 4.8x); • Working capital investment (R3.6 billion) cash conversion >100% • Bolt-on acquisitions (R3
Slide 10: Good cash generation
Good cash generation • R8.1 billion cash generated by operations before working capital • Working capital seasonal absorption of R3.6 billion, yoy R0.6 billion less • Modest additional inventory investment. Need to reduce inventory days in select businesses • Some customers extending payment terms •
Slide 11: Discontinued operations
Discontinued operations • Bidvest Bank, FinGlobal, Bidvest Life • Disposal processes • Signed SPA with Access Bank for Bidvest Bank • Signed SPA with Momentum for FinGlobal • Conditions precedent relate to required regulatory approvals • Strong operational result • Bidvest Bank delivered a steady li
Slide 12: Operational updates
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Slide 13: Services International CEO: Alan Fainman
Services International CEO: Alan Fainman • Excellent overall result boosted by acquisitions which added scale, diversification Financial performance • Facilities management grew slightly faster than hygiene services Revenue +11.2% • Disruptive restructuring now in rearview mirror • Contractual wage
Slide 14: Freight CEO: Wiseman Madinane
Freight CEO: Wiseman Madinane • Trading profit contracted on anticipated lack of maize exports. Bulk mineral volumes Financial performance also decline off the back of lower commodity prices Revenue +8.1% • Negative operating leverage in 2 of the 3 terminal businesses • Liquid and gas volumes handle
Slide 15: Services SA CEO: Akona Matsau
Services SA CEO: Akona Matsau • Outstanding result Financial performance • Superb organic growth Revenue +9.0% • WearCheck acquisition marks our entry into the testing and conditioning industries • Solid Security & Aviation Cluster result led by excellent air cargo results, technology R6.4bn innovat
Slide 16: Branded Products CEO: Gail Solomon
Branded Products CEO: Gail Solomon • An excellent result off a high base Financial performance • Modest topline growth as persistent price reduction pressures muted volume growth Revenue +4.6% impact • Office Products cluster benefitted from continued strong office furniture and automation R7.0bn sa
Slide 17: Commercial Products CEO: Howard Greenstein
Commercial Products CEO: Howard Greenstein • Sharp profit decline partially expected due to renewable sales boom in the base Financial performance • Stagnant market and depressed industrial activity outweighed modest pick-up in Revenue -3.2% DIY demand • Gross margin pressure R8.4bn • Limited renewa
Slide 18: Automotive CEO: Carla Seppings
Automotive CEO: Carla Seppings • A superb overall result as the diversification strategy takes shape • Further progress made on aligning the McCarthy portfolio to current demand trends Financial performance • Multi-franchise dealer points include Mahindra, FAW, Suzuki, JeTour, GAC, LDV. JAC, Revenue
Slide 19: Adcock Ingram CEO: Andy Hall
Adcock Ingram CEO: Andy Hall • Bidvest shareholding 64.8% Financial performance • Revenue → mix +1%; price +5%; organic volumes -7% Revenue -0.6% • Slowdown in lower LSM demand • Destocking in large pharmaceutical wholesalers R4.7bn Trading profit -17.0% • Gross margin pressure due to lower producti
Slide 20: Strategy & outlook
Strategy & outlook
Slide 21: 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 22: Our value proposition
Our value proposition • People: our most valuable asset and enabler Targeting 20 000 in medical insurance roll-out of our business YTD, of the total appointments 8 000 • Grow employment and enhance livelihoods at top and senior levels, 6 000 Lives 69% were Black, 4 000 • Unlock potential through div
Slide 23: The outlook
The outlook • Product, service and geographic diversity remain key strengths as multiple social and economic shifts play out • Macro backdrops uncertain and volatile • Inflation and interest rates lower but global economic policy unpredictable • SA → Broad activity to remain tight until pro-growth i
Slide 24: Appendices
Appendices
Slide 25: Services International
Services International Looking ahead • Acquisition strategy proving beneficial with synergies and benefits materialising • Structural growth support remains but macro backdrops weak • Exciting new business wins • Collaboration and innovation across borders draw on best practice • Contract retentions
Slide 26: Freight
Freight Looking ahead Bidvest Tank Terminals • Increased storage capacity +7% following the commissioning of butane spheres and 18 multi-purpose tanks • Added tank capacity will add to growth • Annual customer rate escalations and improved capacity let contributed to growth • No maize exports expect
Slide 27: Services South Africa
Services South Africa Looking ahead Growth from all clusters and WearCheck contribution pleasing • Commoditised services under price pressure Security and Aviation • Significant new business pipeline • Notable trading profit increases from BidAir Cargo, Vericon, UDS and Bidtrack, partly offset by st
Slide 28: Branded Products
Branded Products Looking ahead Intensified competitor activity and pricing are key themes across the businesses • Investments in IT capability and Consumer focused on essential purchases and value-for-money infrastructure underway to improve Data, Print and Packaging efficiencies • Lithotech, Rotola
Slide 29: Commercial Products
Commercial Products Looking ahead Negative growth in South Africa continues to have a major impact • Targeted and refined customer channels Trade expected to drive volume growth • Eagle Lighting and Voltex MVLV only real highlights in Bidvest Electrical • Renewable energy market’s downward • Restruc
Slide 30: Automotive
Automotive Looking ahead Diversification and appropriate cost structures the key focus areas • SA vehicle market stagnant. New brand McCarthy representation expected to contribute • McCarthy’s pressure points remain in new vehicle sales and margins. Trading profit declined positively to McCarthy • R