Bidvest Group Limited · JSE:BVT
Bidvest — H1 2010 Earnings Presentation
38 slides from Bidvest's earnings presentation, February 2010
Slide 1: Unaudited Results for the six months ended December 31 2009
Unaudited Results For the six months ended December 31 2009 1
Slide 2: What is Bidvest?
Inttroduction What is Bidvest? A group specialising in services services, trading and distribution The Future Freight management, outsourced soft-services, foodservice and food ingredients, automotive retailing and fleet management management, industrial and commercial products Strategy Implementati
Slide 3: Agenda for the H1 F2010 results presentation
Inttroduction Agenda for the H1 F2010 results presentation • Welcome and introduction to the result - CEO Brian Joffe The Future • Bidvest into the future - CEO Brian Joffe • Dissecting the financials - FD David Cleasby • Segment performance and outlook - CEO Brian Joffe ncials • Group outlook - CEO
Slide 4: The H1 F2010 numbers in a nutshell
Inttroduction The H1 F2010 numbers in a nutshell Revenue ª 6.5% to R56.1bn The Future Trading profit © 0.1% to R2.62bn Headline earnings © 13.3% to R1.55bn Headline earnings ex. acquisition expenses © 17.2% to R1.60bn ncials Finan HEPS © 9.0% to R495.0cps Adjusted HEPS* © 12.8% to R512.1cps DPS © 9.
Slide 5: Bidvest into the future
Bidvest into the future CEO Brian Joffe 5
Slide 6: Joffe on Bidvest into the future
Inttroduction Joffe on Bidvest into the future • We have three overarching activities and will stick with them: services, foodservice and products foodservice, The Future • Decentralisation remains a core operational philosophy • Management succession planning within the businesses and at group leve
Slide 7: Dissecting the financials
Dissecting the financials David Cleasby 7
Slide 8: H1 F2009 – FD's perspectives
Inttroduction H1 F2009 – FD’s perspectives • Funding of Nowaco completed, unsecured, €130m at favourable interest rates The Future • Favourable term funding still not easy to come by ¾ Nominal costs declining marginally ¾ increased credit spreads with decreasing base rates • Capital market availabil
Slide 9: Notable financial features of the trading period
Inttroduction Notable financial features of the trading period • Despite a flat trading profit Group margin edged up to 4.7% from 4.4% in H1 F2009 and 4.6% 4 6% in H1 F2008 The Future • All trading segments, with the exception of Bidserv and Bid Industrial and Commercial Products,, improved p margin
Slide 10: Notable financial features of the trading period
Inttroduction Notable financial features of the trading period • Cash generated by operations R3,0bn vs. R0,9bn • R400m in cash applied to working capital vs. R2,4bn The Future • Net interest expense down 32% to R386m, lower rates and utilisation • 25% reduction in net debt to R5,9bn vs. H1 F2009, 3
Slide 11: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% • R3,4bn adverse exchange rate impact on revenue just in translation ncials Finan • R2,6bn reduction
Slide 12: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% ncials T di margins Trading i H1 2010 H1 2009 C C
Slide 13: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 14: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 15: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15,21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 16: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 17: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 18: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 19: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 20: Consolidated Income Statement
Inttroduction Consolidated Income Statement H1 2010 in constant Avg Avg Half year ended December 31 2009 currency R/£12.57 R/£15.21 The Future R/£ 15.21 Revenue 56 113,1 -6.5% 59 990,9 59 510,4 -0.8% Trading profit 2 616,4 +0.1% 2 614,7 2 683,6 +2.6% Net finance expense (385,6) -31.5 (562,9) (385,6)
Slide 21: Consolidated cash flow statement
Inttroduction Consolidated cash flow statement – Rm’s Half year ended December 31 2009 Half year ended December 31 2009 The Future 3455 Cash generated from ops pre wc 3322 -432 Working capital utilised -2405 -380 Net Finance charges -563 -406 Taxation -651 ncials -610 Distributions -853 Finan -3345
Slide 22: Net working capital days
Inttroduction Net working capital days 16 N Nett ddays The Future 9 5 17 9 8 11 33 33 30 Debtors days 37 33 36 31 30 32 33 34 33 30 32 Stock days ncials Finan Creditors days -58 -60 -49 -61 -50 -53 -51 H1 2007 F2007 H1 2008 F2008 H1 2009 F 2009 H1 2010 Performance W/C position iti typically t i ll s
Slide 23: Net working capital flows vs cash generated
Inttroduction Net working capital flows vs cash generated Net working capital Cash generated by operations The Future 4 3.6 3.5 3.5 3.2 3.3 3 3 2.6 2.3 2 1.8 1 1 ncials Finan Rbn 0 -0.4 -1 Performance -2 -2.3 -2.4 -3 -2.5 H1 2007 F 2007 H1 2008 F 2008 H1 2009 F 2009 H1 2010 • Working capital utilisa
Slide 24: Gearing
Inttroduction Gearing Net interest-bearing debt (Rbn) Interest cover (x) 9 10 The Future 9.3 8 9 8.0 7.9 8 7 7.3 6.8 7 6 Target interest cover range 5.7 5.9 6 Rbn 5 5.5 5.5 ncials 5.0 5 4.7 47 Finan 4 4.2 4.1 4 3.8 3 3 2 2 Performance 1 1 0 0 H1 2007 F 2007 H1 2008 F 2008 H1 2009 F 2009 H1 2010 • EB
Slide 25: Segment performance and outlook
Segment performance and outlook CEO Brian Joffe 25
Slide 26: The lows of the trading period
Inttroduction The lows of the trading period • Trading conditions remained very weak in South Africa and Europe July thru December 2009 The Future • Calendar 2009 was thus the most difficult trading period in Bidvest’s two decade history two-decade • An improved working capital position is reflectiv
Slide 27: The highs of the trading period
Inttroduction The highs of the trading period • The group is optimally resourced and positioned, strong balance sheet • Mix of profit drivers beneficial for the group result in these tough times The Future • Profitability and trading margins have held up well • Foodservice Asia has exceeded expectat
Slide 28: Joffe on Bidfreight
Inttroduction Joffe on Bidfreight Trading Profit up 2 2.8% 8% to R375 R375,7m 7m • Generally a pleasing result from most businesses • Export E t trade t d volumes l have h improved i d bbutt consumer iimports t subdued bd d The Future • Safcor Panalpina right-sized for new level of air and sea cargo
Slide 29: Joffe on Bidserv
Inttroduction Joffe on Bidserv Trading Profit down 21 21.3% 3% to R385 R385,3m 3m • Performance matched end of year guidance of a weak first half • Profits declined off a record level in F2009 The Future • A slowing market for travel, forex and hotel occupancy, business retrenchments, subdued custom
Slide 30: Joffe on Bidvest Europe
Inttroduction Joffe on Bidvest Europe Trading Profit up 12 12.8% 8% to R447 R447,1m 1m • 3663 coping well in arduous times, assisted by timely cost saving measures with a 24% rise in £ profits off flat revenue measures, The Future • Difficult economic realities have caught up with Netherlands and Be
Slide 31: Joffe on Bidvest Asia Pacific
Inttroduction Joffe on Bidvest Asia Pacific Trading Profit up 29 29.8% 8% to R370 R370,9m 9m • Australia little affected by global recession due to commodity trade ties with China but economic conditions in New Zealand have been tough The Future • Australian profits up 21% and market share continues
Slide 32: Joffe on Bidfood
Inttroduction Joffe on Bidfood Trading Profit down 1 1.6% 6% to R214 R214,1m 1m • As in the retail sector consumers have been trading down in a recessionary economy and HORECA has been weak, weak with fewer hotel occupancies, occupancies less The Future travel and less hospitality, leisure and cater
Slide 33: Joffe on Bid Industrial and Commercial Products
Inttroduction Joffe on Bid Industrial and Commercial Products Trading Profit down 47 47.6% 6% to R170 R170,2m 2m • Group segment most exposed to the sectors of the economy severely impacted by the recession and the result is a continuation of the sharp The Future deterioration observed in the second
Slide 34: Joffe on Bidpaper Plus
Inttroduction Joffe on Bidpaper Plus Trading Profit up 4 4.3% 3% to R135 R135,9m 9m • Sales and profit performance quite acceptable in a soft market with some notably good divisional achievements The Future • Reduced demand for manufactured print products and excess capacity led to margin pressure •
Slide 35: Joffe on Bid Auto
Inttroduction Joffe on Bid Auto Trading Profit up 29 29.9% 9% to R278 R278,4m 4m • An improved result but new car retail margin remains unacceptably low The Future • Investment returns assisted result • New vehicle market remained weak but appears to have troughed • Credit approvals are half pre Nat
Slide 36: Joffe on Bidvest Namibia
Inttroduction Joffe on Bidvest Namibia Trading Profit up 19 19.0% 0% to R150 R150,0m 0m • Namibian economy has held up relatively well in the global recession • The Th Fishing Fi hi andd Freight F i ht operations ti returned t d strong t results lt The Future • The majority of Bidcom businesses perf
Slide 37: Joffe's Group outlook
Inttroduction Joffe’s Group outlook • The new economic reality offers opportunity for a well resourced entrepreneurial business with access to capital The Future • The economic outlook for major Western economies is anaemic but far brighter for emerging Central Europe, Asia Pacific, and Africa • We
Slide 38: Thank you Q&A
Thank you Q&A 38