Slide 1: Unaudited Interim Financial Results
Unaudited Interim Financial Results Six months ended 31 December 2016
Slide 2: Agenda
Agenda 01 Introduction Lindsay Ralphs – Bidvest CEO 02 Operational updates Lindsay Ralphs – Bidvest CEO 03 Financial review Peter Meijer – Bidvest CFO 04 Strategic overview and outlook Lindsay Ralphs – Bidvest CEO 05 Appendices Included after presentation slides Unaudited Financial Results - six mon
Slide 3: Introduction
Lindsay Ralphs Bidvest CEO Introduction
Slide 4: We are BIDVEST
We are BIDVEST A leading South African trading, distribution and service group operating in the areas of commercial products, electrical products, financial services, freight services, office and print solutions, outsourced hard and soft services and automotive retailing Proudly yesterday, proudly t
Slide 5: A diversified portfolio with consistent delivery
A diversified portfolio with consistent delivery Contribution to revenue Contribution to trading profit 1% 6% 5% Services 7% 18% 11% Freight 27% 5% Automotive 7% Office and print 12% 10% Commercial Products Financial Services 14% 12% Electrical 19% 33% Namibia 13% No segment contributing more than 3
Slide 6: Features for the period
Features for the period Robust trading result before investment income, up 7.5% HEPS 600 489.0 510.3 500 Bidvest South Africa recorded commendable increases in trading profits 400 cents 300 Reduced fishing quotas continue to impact Bidvest Namibia 200 100 0 Impairment reversal in Adcock Ingram and C
Slide 7: Operational updates
Lindsay Ralphs Bidvest CEO Operational updates
Slide 8: South Africa | Overview
Bidvest South Africa | Overview Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 34 845 560 33 646 687 3.6% Trading profit 2 811 730 2 648 796 6.2% Trading margin 8.1% 7.9% EBITDA 3 565 565 3 393 685 5.1% Average Funds Employed 17 317 684 15 801 708 9.6% Av
Slide 9: Services | CEO: Alan Fainman
Bidvest Services | CEO: Alan Fainman Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 6 474 719 6 154 750 5.2% Trading profit 765 762 717 117 6.8% Trading margin 11.8% 11.7% EBITDA 974 718 923 142 5.6% Average Funds Employed 1 977 857 1 836 821 7.7% Average
Slide 10: Freight | CEO: Anthony Dawe
Bidvest Freight | CEO: Anthony Dawe Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 2 447 272 3 006 686 (18.6%) Trading profit 543 851 512 397 6.1% Trading margin 22.2% 17.0% EBITDA 677 659 646 513 4.8% Average Funds Employed 1 803 016 1 598 848 12.8% Aver
Slide 11: Automotive | CEO: Steve Keys
Bidvest Automotive | CEO: Steve Keys Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 12 371 585 12 149 439 1.8% Trading profit 364 496 357 814 1.9% Trading margin 2.9% 2.9% EBITDA 528 785 485 044 9.0% Average Funds Employed 3 865 700 3 863 587 0.1% Average R
Slide 12: Office and Print | CEO: Kevin Wakeford
Bidvest Office and Print | CEO: Kevin Wakeford Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 5 080 027 5 151 281 (1.4) Trading profit 357 470 415 325 (13.9) Trading margin 7.0% 8.1% EBITDA 426 234 485 284 (12.2%) Average Funds Employed 2 461 343 2 519 31
Slide 13: Commercial Products | CEO: Howard Greenstein
Bidvest Commercial Products | CEO: Howard Greenstein Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 3 735 196 2 992 545 24.8% Trading profit 332 117 242 507 37.0% Trading margin 8.9% 8.1% EBITDA 369 487 269 602 37.0% Average Funds Employed 2 203 449 1 421
Slide 14: Financial Services | CEO: Japie van Niekerk
Bidvest Financial Services | CEO: Japie van Niekerk Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 2 003 082 1 509 218 32.7% Trading profit 301 956 264 671 14.1% Trading margin 15.1% 17.5% EBITDA 420 017 427 600 (1.8%) Average Funds Employed 3 082 428 2 9
Slide 15: Electrical | CEO: Stanley Green
Bidvest Electrical | CEO: Stanley Green Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 2 733 679 2 682 768 1.9% Trading profit 146 078 138 965 5.1% Trading margin 5.3% 5.2% EBITDA 168 665 156 500 7.8% Average Funds Employed 1 734 013 1 628 669 6.5% Averag
Slide 16: Namibia | CEO: Sebby Kankondi
Bidvest Namibia | CEO: Sebby Kankondi Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Revenue 2 172 638 2 045 915 6.2% Trading profit 23 416 120 662 (80.6%) Trading margin 1.1% 5.9% EBITDA 66 624 158 840 (58.1%) Average Funds Employed 1 784 403 1 722 010 3.6% Aver
Slide 17: Corporate
Bidvest Corporate Six months ended Six months ended R’000s 31 December 2016 31 December 2015 Change Turnover 803 347 837 298 (4.1) Trading profit (28 335) (50 389) 43.8% Trading margin (3.5%) (6.0%) Corporate comprises Bidvest Properties, material associates and other investments Negative mark
Slide 18: Financial Review
Peter Meijer CFO Financial Review
Slide 19: Financial highlights
Financial highlights Revenue EBITDA Trading result Trading profit up 4.1% to up 2.3% to up 7.5% to up 3.2% to R36.0 billion R3.63 billion R2.9 billion R2.8 billion Trading margin Operating expenses stable ratio improved to Interest cover Debt/Equity ratio of 7.8% 20.1% 7.0 times 42.7% vs 7.9% previo
Slide 20: Income statement
Income statement 31 December 31 December Rm 2016 2015 % change Revenue 36 036 34 611 4.1 Gross income 10 080 9 718 3.7 Operating expenses (7 252) (7 102) 2.1 Trading result 2 905 2 701 7.5 Income from investments (98) 18 n/a Trading profit 2 807 2 719 3.2 Net capital items 229 (228) n/a Net finance
Slide 21: Income statement analysis
Income statement analysis • Revenue increased by R1.4 billion or 4.1% • South African operations grew revenue by 3.6% Revenue • Significant increase in Commercial Products’ (incl Brandcorp acquisition) and Financial Services’ revenue • Freight revenue affected by the sale of Manica • Gross profit ma
Slide 22: Income statement analysis (continued)
Income statement analysis (continued) Net capital • Impairment reversal of R319.8 million for Adcock Ingram, Comair and Cullinan in this period, relative to impairments of R216.9 million in items include H1 2016 and R760.8 million for full year 2016 Net finance • Increased debt to finance Brandcorp
Slide 23: Consolidated cash flow statement (like-for-like)
Consolidated cash flow statement (like-for-like) H1 2017 H1 2016 R bn R bn 3.7 Cash generated from operations pre working capital 3.4 -1.9 Working capital absorbed -2.0 -0.5 Net Finance charges -0.4 -0.5 Taxation -0.6 -0.9 Distributions -1.7 -1.4 Cash effects of investment activities -2.3 -0.9 Cash
Slide 24: Net working capital
Net working capital Cash generated vs working capital Working capital days 4.5 80% 36 37 75% 3.5 60% 2.5 3.4 3.3 3.7 40% 59 58 Payables 1.5 R billion 2.3 0.5 21% 20% -0.5 Inventory -2.0 -1.9 0% 63 62 -1.5 -20% -20% -2.5 Receivables 31 32 -3.5 -40% H1 2016 2016 H1 2017 H1 2016 H1 2017 Cash generated
Slide 25: Debt and funding – a conservative approach to gearing
Debt and funding – a conservative approach to gearing Interest cover Debt/Equity 9 10 45% 8 7.9 8.0 9 41.3% 42.7% 40% 7 7.0 8 35% 6 7 30% 5 6 27.5% 25% 5 4 7.8 8.4 20% 4 7.8 8.4 3 15% 5.1 3 5.1 2 2 10% 1 1 5% 0 0 0% H1 2016 2016 H1 2017 H1 2016 2016 H1 2017 Net debt (Rbn) EBITDA interest cover (time
Slide 26: Strategic overview and outlook
Lindsay Ralphs Bidvest CE Strategic overview and outlook
Slide 27: Strategy and prospects
Strategy and prospects Economic • Current trading conditions expected to continue, although a gradual modest improvement is outlook anticipated, supported by drought relief and improved business confidence • Focus to remain on seven core divisions, each with their own well-diversified portfolio of A
Slide 28: Appendix
Appendix 1
Slide 29: Group structure
Group structure LP Ralphs Chief Executive P Meijer Group Financial Officer Executive team comprising M Madisa Executive Director G McMahon Executive Director Bidvest Industrial Bidvest Namibia Bidvest Properties Material Associates Other Investments Services Automotive Bidvest occupied properties Ad
Slide 30: We are Bidvest
We are Bidvest A blend of defensive, cyclical and growth assets Diversified and asset light businesses that are strongly cash generative Resilient business model Dominant positions in each of our markets with broad product offerings Highly entrepreneurial and decentralised management teams
Slide 31: Services | CEO: Alan Fainman
Bidvest Services | CEO: Alan Fainman Impressive results evident in Bidvest Facilities Management Services, Security Services and most of the Allied Services businesses Bidvest Steiner had modest growth, with challenges in recovering cost increases from customers Prestige showed pleasing growth
Slide 32: Freight | CEO: Anthony Dawe
Bidvest Freight | CEO: Anthony Dawe Bidvest Tank Terminals had a pleasing first 6 months with increases in volumes for chemical, edible oil, gas and petroleum. Good progress is being made on the Capex projects in Richards Bay with the Puma fuel tanks now commissioned SA Bulk Terminals performed
Slide 33: Automotive | CEO: Steve Keys
Bidvest Automotive | CEO: Steve Keys Total dealer market down by 13% and dealer passenger market down by 16% year-on-year New vehicle margins remain under extreme pressure Used vehicles have stabilized with a slight increase in volumes and pleasing improvement in margin Marginal decrease in
Slide 34: Office and Print | CEO: Kevin Wakeford
Bidvest Office and Print | CEO: Kevin Wakeford Revenue drop mainly from non-recurrence of a Tanzanian voter registration project and the disposal of Kolok Mozambique Solid performances for all companies apart from Konica Minolta and Kolok Konica Minolta and Kolok impacted by adverse currency m
Slide 35: Commercial Products | CEO: Howard Greenstein
Bidvest Commercial Products | CEO: Howard Greenstein Good turnover growth and expense management Pressure on margins but well managed G Fox , Plumblink, and Buffalo Tapes performing exceptionally well Consumer businesses feel the pinch as volumes taper off Brandcorp performing to expectati
Slide 36: Financial Services | CEO: Japie van Niekerk
Bidvest Financial Services | CEO: Japie van Niekerk Banking Insurance Acquiring sales and turnover starting to grow Global Credit Rating reaffirmed Bidvest Insurance’s claims paying ability Telkom contract continuing Strong revenue growth in Commercial Insurance Corporate advances rose by
Slide 37: Electrical | CEO: Stanley Green
Bidvest Electrical | CEO: Stanley Green Infrastructure development, mining and construction remain at a low ebb Excellent performance from Solid State Power Voltex branch business improved margins and opened a new format store Waco business remains strong, profitability impacted by volume pr
Slide 38: Namibia | CEO: Sebby Kankondi
Bidvest Namibia | CEO: Sebby Kankondi Problematic access to fishing quotas, especially horse mackerel Contribution to EBIT Low market prices, a stronger Namibian dollar and declining 120 pilchard catches Bidfish made first loss ever (52% contribution to profits in 2016) 100 Freight division
Slide 39: Appendix
Appendix 2
Slide 40: Shareholders
Shareholders Investment management shareholdings – Dec 2016 Geographic split of investment managers Investment manager Total shareholding % 11% PIC (ZA) 49 052 514 14.62 5% J.P. Morgan Asset Management 22 484 000 6.71 40% Lazard Asset Management LLC Group 20 601 348 6.15 14% GIC Asset Management Pte