Bidvest Group Limited · JSE:BVT
Bidvest — The Bidvest Group — FY2003 Earnings Presentation
33 slides from Bidvest's earnings presentation, Jun 30, 2003
Slide 1: Audited Results for the Year Ended June 30 2003
AUDITED RESULTS FOR THE YEAR ENDED JUNE 30 2003 The BIDVest Group Limited
Slide 2: Financial Highlights
Financial Highlights • Revenue Ï 12,2% to R47,1bn • Operating income Ï 11,5% to R2,24 bn • Operating income pre translation gains Ï 18,3% to R2,26 bn • Headline earnings Ï 13,1% to R1,48 bn • Headline earnings per share Ï 9,81% to 479,0 c • Total distribution per share Ï 15,8% to 220,0 c
Slide 3: Financial Highlights
Financial Highlights • Operating margin pre translation gains Ï From 4,6% to 4,8% • Headline earnings per share pre translation gains Ï 20,4% • SA organic growth of approximately 16% in operating income • Compound growth rate in HEPS of 27,7% pa over 12 years • Share buyback • Fitch rating reaffirme
Slide 4: The 14th year of uninterrupted growth continues…
The 14th year of uninterrupted growth continues… Revenue Operating Income Headline earnings per share …however, this year’s results may be below expectation
Slide 5: Operating results were negatively impacted by
Operating results were negatively impacted by: 2003 2002 Rm Rm • Foreign cash resources currency movements (15,1) 102,6 • Investment in fishing operations 31,5 104,5 • Non-recurring loss from discontinued operation to date of closure (8,9) 0,1 • Bidcorp plc (0,8) 14,0 TOTAL 8,3 221,2
Slide 6: Financial Review – Analysis of Capital Items
Financial Review – Analysis of Capital Items (net of tax and minority interests) 2003 2002 Rm Rm • Net loss and disposal of discontinued businesses 11,6 3,9 • Net loss on disposal of assets 19,2 0,1 TOTAL 30,8 4,0
Slide 7: Operational Highlights
Operational Highlights • BEE transaction • On track for implementation by November 2003 • Operational margin growth with appreciating currency • Lithotech France, acquired out of receivership, made profit • Growth in current period largely organic • Second half growth slower than first half • Corpor
Slide 8: Segmental Analysis of Operating Income: The Services Division
Segmental Analysis of Operating Income The Services Division
Slide 9: The Services Division: Bidfreight
The Services Division Bidfreight • Rand / dollar impacts • Only modest increase in imports / exports becoming less competitive • Working with Spoornet to solve capacity constraints • Separation of NPA will benefit terminals • Safcor Panalpina benefited from incorporation of Renfreight • Closure of S
Slide 10: The Services Division: Bidcorp plc
The Services Division Bidcorp plc • Some businesses discontinued • Some continuing operations restructured – significant costs • Slow economic growth and Iraqi war delayed recoveries • Ongoing focus on cost reductions and operational efficiencies • Business well positioned to benefit from improved m
Slide 11: The Services Division: Bidserv
The Services Division Bidserv • General move to formal tender processes • Increased market share and margins • Prestige, Provicom Electronics, Commercial Sundries, and the Laundry division did particularly well • Magnum Shield’s lower than expected performance in line with industry downturn • Effect
Slide 12: The Services Division: Rennies Financial Services
The Services Division Rennies Financial Services • Strong inbound tourism, weak outbound tourism • Travel • Excellent performance in mixed year • Successful rationalisation of low performing units • Driving fee income and technology solutions • Prospects moderately favourable barring global upsets •
Slide 13: Segmental Analysis of Operating Income: The Foodservice Products Division
Segmental Analysis of Operating Income The Foodservice Products Division
Slide 14: The Foodservice Products Division: Bidvest plc
The Foodservice Products Division Bidvest plc • 3663 First for Foodservice (United Kingdom) • All business recorded growth in subdued market • Acquisition of Swithenbank, a fresh and chilled product distributor • MoD awarded National Business Award for Supply Chain Strategy • Ongoing depot modernisa
Slide 15: The Foodservice Products Division: Caterplus
The Foodservice Products Division Caterplus • All divisions performed well • Significant food price inflation and increased tourism in first half - reversed in second half • National customers consolidating procurement – lower margins to these customers • Bigger ‘basket’, new products • Vulcan-CAARS
Slide 16: The Foodservice Products Division: Combined Foods
The Foodservice Products Division Combined Foods • NCP Yeast • Restructure of baking industry - favourable • Results significantly improved • Chipkins Bakery Supplies • Aggressive trading by competitors • Major restructuring and cost savings at Johannesburg facility • Crown National • Higher red mea
Slide 17: Segmental Analysis of Operating Income: The Commercial Products Division
Segmental Analysis of Operating Income The Commercial Products Division
Slide 18: The Commercial Products Division: Bidoffice
The Commercial Products Division Bidoffice • Stationery • Waltons’ asset management and operating income above budget • Acceptable results from Kolok • Printing and Related • Lithotech achieved commendable results through increased margins, asset management and cost savings • Paragon successfully in
Slide 19: The Commercial Products Division: Bidpac
Segmental Analysis The Commercial Products Division Bidpac • Improved profitability and asset management • Volatile trading conditions • Strong manufacturing growth and selling price inflation in first half • Distinct slow down, de-stocking, more competition in second half • Import replacement progr
Slide 20: The Commercial Products Division: Voltex
Segmental Analysis The Commercial Products Division Voltex • Solid performances by all businesses except Cabstrut and Eastman Staples in the United Kingdom • Government’s commitment to housing projects gained momentum • Strengthened rand put pressure on margins • Strategic, but subtle change in dire
Slide 21: Segmental Analysis of Operating Income: Corporate Services
Segmental Analysis of Operating Income Corporate Services
Slide 22: Corporate Services: IT Services
Segmental Analysis Corporate Services IT Services • mymarket.com • e-marketplace industry consolidation • Building reputation as market leader • Wide range of customised solutions developed • Focus on completion of early adopted client programmes • 32 buying organisations, 660 suppliers and 5637 use
Slide 23: Strategic Objectives on Target
Strategic Objectives on Target • BEE initiative to create opportunities • Offshore platform in place to internationalise businesses • Integrated product and service solutions – opportunities for cross-selling to extend reach into each customer • Well positioned for growth – organic and acquisitive •
Slide 24: To be or not to be… that is our question
“TO BE OR NOT TO BE… THAT IS OUR QUESTION”
Slide 25: Appendices
Appendices
Slide 26: Consolidated Group Income Statement
Consolidated Group Income Statement
Slide 27: Segmental Analysis: Revenue
Segmental Analysis Revenue 2003 2002 Percentage R’o00 R000 change REVENUE The Services Division 18 292 281 16 424 403 11,4 Bidfreight 13 676 421 12 984 127 5,3 Bidcorp pic 1 956 688 1 078 403 814 Namsov Fishing 282 107 320993 (12,1) Bidserv 1735 005 1 505 982 15,2 Renfin 642 060 534 898 20,0 The Foo
Slide 28: Segmental Analysis: Operating Income
Segmental Analysis Operating Income
Slide 29: Segmental Analysis: Operating Margin
Segmental Analysis Operating Margin
Slide 30: Consolidated Balance Sheet
Consolidated Balance Sheet coNnsoLipAteD BALANCE sheet AT JUNE 30 2002 R000 ASSETS Non-current assets Fixed assets Intangible assets Deferred taxation Investments and advances Banking and other advances Current assets Other current assets Liquid funds 5 118 290 3 602 498 681 903 262 747 378997 192 1
Slide 31: Consolidated Cash Flow
Consolidated Cash Flow CONSOLIDATED CASH FLOW FOR THE YEAR ENDED JUNE 30 STATEMENT 2003 R’o00 2002 R'000 Cash flow from operating activities Operating income net of capital items Depreciation and other non-cash items Changes in working capital Cash generated by operations Net finance expense Taxatio
Slide 32: Analysis of Value
Analysis of Value Bidvest plc Market US / UK Peers Bidvest market cap @ R46,50 R14,6bn R14,6bn Less value of Bidcorp / Lithotech France R0,6bn R0,6bn Less value of Bidvest plc R4,0bn R5,3bn Implied market value of SA business R10,0bn R8,7bn Implied PE ratio of SA business 9,4X 7,6X
Slide 33: Analysis of Group Services, Investments and Other Income
Analysis of Group Services, Investments and Other Income 2003 2002 Rm Rm • Share dealing profits 51,8 45,2 • Dividends from associates 9,9 10,3 • Exchange losses/profits on cash (15,1) 102,6 • Other costs (38,3) (49,2) For information purposes