Reunert Limited · JSE:RLO
Reunert — FY2024 Earnings Presentation
28 slides from Reunert's earnings presentation, 2024
Slide 1: Results Presentation
RESULTS PRESENTATION For the financial year ended 30 September 2024 1
Slide 2: Contents
CONTENTS 1 2 3 4 5 Performance Delivering on Financial Segmental Prospects overview the strategic results for the review imperatives year 2
Slide 3: Performance overview
01 Brand update 04 Performance overview 3
Slide 4: 2024 Achievements Increased Shareholder Value
2024 ACHIEVEMENTS INCREASED SHAREHOLDER VALUE Strong financial performance Increased shareholder returns Operating profit (Rm) Total dividend R1 531m 7% 1 231 1 431 1 531 up 10% to 366 cents 1 050 Operating profit 4,5% dividend yield (2023: R1 431m) 2021 2022 2023 2024 R1 038m 8% ROCE Profit for the
Slide 5: Delivering on the strategic imperatives
Brand update 02 04 Delivering on the strategic imperatives 5
Slide 6: Delivering Our Key Strategic Initiatives | ICT
DELIVERING OUR KEY STRATEGIC INITIATIVES| ICT THE MERGE ACHIEVEMENTS Unlocking growth opportunities across public and private sector digitalisation Managed Services Digital Services Growing market share in enterprise clients ˃ 65 new clients notable growth in existing clients Eco-System Enterprise D
Slide 7: Delivering Our Key Strategic Initiatives | Renewable Energy
DELIVERING OUR KEY STRATEGIC INITIATIVES| RENEWABLE ENERGY Well positioned for continued growth as liberalisation of energy market accelerates Electricity Regulation Amendment Act (ERA) signed in August 2024 Creation of a competitive electricity market ˃ Improved access for independent power produce
Slide 8: Delivering Our Key Strategic Initiatives | Renewable Energy
DELIVERING OUR KEY STRATEGIC INITIATIVES| RENEWABLE ENERGY Reunert participates across the renewable energy value-chain Terra Firma and Blue Nova benefit from commercial and industrial (C&I) demand for integrated PV and battery storage driven by: ˃ Significant Eskom price increases ˃ Grid instabilit
Slide 9: Delivering Our Key Strategic Initiatives | Internationalisation
DELIVERING OUR KEY STRATEGIC INITIATIVES| INTERNATIONALISATION GEOGRAPHICAL SPLIT OF INTERNATIONAL REVENUE (Rm) Record international Defence revenues 4-year CAGR = 20% ˃ Increased by 21% in 2024 4 889 ˃ 20% CAGR since 2020 from R2,3bn to R4,9bn 414 ˃ Provides a significant income stream to augment S
Slide 10: Financial results for the year
03 Brand update 04 Financial results for the year 10
Slide 11: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS 2024 2023 Change (Rm) (Rm) (%) 1 5% increase in revenue due to: 1 Revenue 14 446 13 781 5 > Structural changes resulting from the acquisition of IQbusiness and the disposal of Terra Firma Solutions to the Lumika joint venture Operating profit 1 531 1 431 7 >
Slide 12: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS 2024 2023 Change (Rm) (Rm) (%) 2 7% increase in operating profit due to: Revenue 14 446 13 781 5 > Structural changes resulting from the acquisition of IQbusiness and the disposal of Terra Firma Solutions to Lumika Segment operating profit 1 536 1 462 5 > Ope
Slide 13: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS 2024 2023 Change (Rm) (Rm) (%) 3 11% increase in profit before tax and equity- Revenue 14 446 13 781 5 accounted investee due to: ˃ Improved cash management Operating profit 1 531 1 431 7 ˃ Reduced net interest cost of R71 million (2023: R120 million), despit
Slide 14: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS 2024 2023 Change (Rm) (Rm) (%) 4 2% increase in effective tax rate due to impact of Revenue 14 446 13 781 5 battery storage business: > Impairment of goodwill; and Operating profit 1 531 1 431 7 > Deferred tax asset not raised Interest and dividend income 109
Slide 15: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS 2024 2023 Change (Rm) (Rm) (%) 5 Increase in: Revenue 14 446 13 781 5 ˃ basic earnings per share of 13% ˃ HEPS of 10% Operating profit 1 531 1 431 7 ˃ diluted earnings per share of 7% Interest and dividend income 109 51 Lower than basic earnings per share inc
Slide 16: Consolidated Statement of Financial Position
CONSOLIDATED STATEMENT OF FINANCIAL POSITION Debt well within covenants with no gearing on ‘a net cash basis’ Sep 2024 Sep 2023 (Rm) (Rm) PP&E, investment property, ROU assets & IA 1 900 1 961 1 Goodwill 1 130 1 186 1 Goodwill impairment at battery storage business 2 Investment in joint venture 189
Slide 17: Cash Flow Analysis
1 Increased investment into working capital due high level of sales in Q4 2024 CASH FLOW ANALYSIS offset by reduction in inventory and increased payables Group cash generation supports operational and strategic objectives and dividend payments 2 Free cash flow covers the total dividend for the year
Slide 18: Capital Allocation 2022 - 2024
CAPITAL ALLOCATION 2022 - 2024 Sources of capital Uses of capital Cash on hand R291m 1 Expansionary capex R551m A 30 Sep 2021 2 Acquisitions R712m 1 Free cash flow R3 148m 3 Purchase of minority interests R104m 4 Funding to Lumika JV R189m 2 Net debt raised R1 296m 5 Net dividends paid R1 511m Proce
Slide 19: Segmental review
04 Brand update 04 Segmental review 19
Slide 20: Electrical Engineering
ELECTRICAL ENGINEERING Excellent segment performance and record non-South African revenues Drivers Financial performance Outlook & Prospects Manufacturing driven by increased non-South African volumes Increasing exports to augment local volumes SEGMENT REVENUE (Rm) ˃ Power cables ˃ Power cables 7% −
Slide 21: ICT
ICT Solid ICT performance in a tough economic climate Drivers Financial performance Outlook & Prospects Good revenue growth Segment well positioned for growth SEGMENT REVENUE (Rm) ˃ Continued growth at +OneX: Solutions & Systems Integration growth in digital services 27% ˃ Strong market growth forec
Slide 22: Applied Electronics
APPLIED ELECTRONICS Strong defence and solar energy performance Drivers Financial performance Outlook & Prospects Segment revenue and operating profit declined despite a good Strong order book supports medium term growth in financial SEGMENT REVENUE (Rm) performance in the Defence Cluster as: perfor
Slide 23: Renewable Energy
RENEWABLE ENERGY Improved profitability in solar energy business Drivers Financial performance Outlook & Prospects Improvement in profitability of the solar energy business Solar energy business well positioned to continue to deliver RENEWABLE ENERGY CLUSTER REVENUE (Rm) sustained profitability ˃ Op
Slide 24: Prospects
05 Brand update 04 Prospects 24
Slide 25: Prospects
PROSPECTS ˃ Reunert is encouraged by the political developments in South Africa since the May elections and believe a steady uplift in key economic indicators will occur ˃ An improvement in the Group’s key drivers of GDP, GDFI and business confidence will − support Reunert’s growth − result in posit
Slide 26: The investment case
nert 06 Rewer "the investment case
Slide 27: Reunert's Investment Case
REUNERT’S INVESTMENT CASE Delivering financial growth underpinned by a strong balance sheet, financial discipline through considered capital allocation, and pursuing organic and acquisitive growth Investment highlight Drivers Deliverables − Strong, defendable market positions 1 High quality assets i
Slide 28: Q&A Key upcoming dates
Q&A Key upcoming dates > HSBC Conference 05 December 2024 > Integrated Report 20 December 2024 Contact Us > AGM 25 February 2025 > Avior Conference 25 March 2025 karens@reunert.co.za 28