Transcript Slide 1

Appendix 1
Geographic and Segmental Revenue and Trading Profit
1
Geographic Revenue and Trading Profit splits
Appendix 1
H1 2009
H1 2008
SA
Revenue
Asia Pacific
UK & Europe
Trading Profit
Africa
Revenue
Contribution:
Foreign operations
SA operations
Trading Profit
H1 2009
H1 2008
H1 2009
H1 2008
47%
43%
30%
27%
53%
57%
70%
73%
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Segmental contributions to results
Appendix 1
Segment
%
Contribution
to
Revenue
%
Contribution
to
Trading Profit
Bidfreight
17.5
14.0
Bidserv
5.9
18.7
International Foodservices
45.8
26.1
Bidfood (SA)
4.3
8.3
Bid Industrial & Commercial
8.1
12.4
Bidpaper Plus
1.9
5.0
BidAuto
14.4
8.2
Corporate
2.1
7.3
3
Appendix 2
Divisional Results
4
Bidfreight – Abating activity
Appendix 2
Current contribution to
Group Trading Profit
14.0%
5
Bidfreight – Abating activity
Appendix 2
Results
►IVS returned
a particularly strong result; together with a
good contribution from Marine, Bulk, and Manica
►Debtors being carefully monitored
►Mixed progress with NPA lease negotiations
►Safcor Panalpina: profits up 7%; Airfreight volumes fall
15%, Seafreight flat; customer base under pressure
• Marine: profits up 12% driven by higher vehicle export
and improved port volumes
• RDS: profits reduced by 12%, volumes weak across all
categories
SACD: profits up 3%, export volumes weaken
►IVS: profits up 7%; increased capacity utilisation;
replacement tanks coming on stream
•
Revenue
+ 1.4%
Trading Profit
+10.5%
Rm Trading Profit
Trading Margin
3.1%
3.4%
►Bulk Connections:
profits up 15%; satisfactory trading
but manganese exports reduced in Q2. Durban lease
being negotiated
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Bidfreight – Abating activity
Appendix 2
SABT: profits up 2%; maize and wheat exports down in Q2; wheat imports delayed as purchasers
delay to take advantage of significantly lower freight rates; a positive H2 expected
• BPO: profits down 27% as exports of steel, forest products, and ferrochrome and imports of cement
and rice decline.
• Naval: profits down 36% as key business areas come under pressure
• Manica: four fold rise in profits; new business obtained regionally; mineral volumes out of DRC and
Zambia fall; trade in the region remains variable and unpredictable
•
Strategic imperatives & prospects
►Trade volume reductions
likely to get worse before getting better
►Break bulk cargos have slumped, but recent improvement
►Sharply reduced freight rates are positive for customers
►Container vessels reducing size and frequency of calls
►Ongoing selective capex on the back of major contracts
►There is tentative evidence of protectionism in certain countries – this is negative for trade flows and
accentuates downturn
►Competitive position is without parallel
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Bidserv – Cleaning up
Appendix 2
Current contribution to
Group Trading Profit
18.7%
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Bidserv – Cleaning up
Appendix 2
Results
► Profitability at an all time high
► Bank and Industrial achieve exceptional results
•
•
•
•
•
•
•
Prestige: profits up 7% despite double digit wage increases
across the industry
TMS: profits up 17% but petroleum industry under pressure.
Saudi business, which opened for business in December,
audited and accredited as a preferred supplier
Laundries: profits up 4%; hospitality industry experiencing
major declines in occupancy; motor industry redundancies
will affect garment rental results in future; competitor stress
Steiner: result flat; management restructuring undertaken
Security: Provicom made a loss, significant projects put on
hold by customers; both Magnum and Vericon did very well;
Global Payment Technologies: profits more than doubled
and the outlook is promising; international distribution
agreement with Talaris (previously known as De la Rue)
provides diversification
Top Turf: profits down 15% but within budget as business
consolidated and stabilised at a time when project activity is
declining
Revenue
+23.3%
Trading Profit
+27.2%
Rm Trading Profit
Trading Margin
13.4%
13%
Bidserv – Cleaning up
Appendix 2
•
•
•
•
•
•
Industrial: profits up 49%; facilities underpin competitive strengths; G Fox roll-out successful; consideration
being given to expanding national footprint
Office – Konica Minolta & Oce: underlying profits flat; unit sales slow; weak rand vs. yen a challenge; price
increases on government contracts implemented; office automation offering highly competitive
BidAir: profits +74%; new management team in place
BidTravel Solutions (including BidTravel, MyMarket, Procurement) : profits down 18% due to a decision to
smooth overrides through the year; however, economic slowdown impacting travel and override income under
threat; new automated travel engine well received and this, together with right-sizing measures underway, will
cushion blow of severe economic pressures; procurement savings for the group
Bidvest Bank: profits double, assisted by new forex products, new branches, and a volatile exchange rate; an
exceptional result expected in F2009
Hotel Amenities: profits down as SA hotel occupancies decline but export sales into Africa via the SAA strategic
amenities alliance will offset this in H2
Strategic Imperatives and Prospects
► Flexible to take corrective action if trading turns for the worse
► Number of contracts secured for 2010 World Cup
► Travel overrides under threat – cost rationalisation underway
► Relative stability in a number of areas with good divisional competitive advantages in a tough economy
► BidAir continues to offer good upside
► Bidvest Bank expected to be exceptional
► Profits will be well up on 2009 – hard times notwithstanding
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Bidvest Europe – Gruelling
Appendix 2
Current contribution to
Group Trading Profit
15.2%
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Bidvest Europe – Gruelling
Appendix 2
Results
►Total
profits down 3% to R396,3m. Sterling
average exchange rate €1.23 (€1.45). Deli XL
combined is 40% of total profits
Revenue
+20.8%
Trading Profit
- 3.4%
►Food
prices high in all markets but inflation rate
now falling and there is a risk of price declines
•
•
Deli XL Netherlands: +16% (€9.3m profit vs.
€8,1m); revenue €383.5m (+8%); ROS 2.4%
(2.3%); cash generated by operations €17.9m;
volumes diminished in Q2 but margin
improvement is foreseen; focus on receivables;
Dutch smoking ban in public places a negative
Deli XL Belgium: +79% profit (€1.95m) on
€125.3m revenue (+8%); ROS 1.6% (0.9%);
Increased business with Sodexo; sales focus on
Flanders for Kruibeke site
Rm Trading Profit
Trading Margin
2.6%
2.0%
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Bidvest Europe – Gruelling
Appendix 2
Horeca: £0.2m profit; ROS 3.2% vs. 0.5%. Sales in local currency rise 52% due to mix, pricing
strategy and currency effect; strict credit policy improves collections; depressed Middle Eastern
economy presents challenges for future growth
• 3663: sales 8% up at £863.7m; profits down 25% to £16,9m; ROS 1.9% vs. 2.9%, cost control
very good ; working capital moves out due to pre-emptive buying and inflation but receivables
are a problem and bad debts are rising; total cases sold down 5% with wholesale down 9%;
suddenness and magnitude of the severe slump far greater than could be predicted
― Wholesale sales flat, profits down 30%; focus on cash margin, passing through prices and
growing new business
― Logistics infrastructure being optimised and costs cut;
― Barton Meat closed and costs expensed
•
Strategic imperatives & prospects
►Deli XL: conditions
remain unpredictable; efficiencies remain under the spotlight
►3663 will benefit from industry consolidation; debtors under focus; further depot optimisation
underway; profits will be well down on 2008; business model is robust and we have no intention of
changing it
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Bidvest Asia Pacific – All shoulders at the wheel
Appendix 2
Current contribution to
Group Trading Profit
10.9%
14
Bidvest Asia Pacific – All shoulders at the wheel
Appendix 2
Results
►Highly motivated
staff, joined-up team effort as conditions
deteriorate in all markets
•
Australia: sales up 16% to A$819.8m (real growth 6%),
profits up 16% to A$31.1m; ROS 3.8% vs. 3.8%;
expenses maintained on prior and inventory well
controlled; market share gains in a flat market; debtor
provisions increased
Foodservice sales up 12%, profits up 10% ; some
customers transferred into QSR; cost pressures
easing; branch results vary but overall excellent;
growth opportunities will be tackled responsibly
― Hospitality remains in development but although
small in profits adds to offering; market share gained
in an increasingly bleak trading environment
― QSR profits up 5% in line with budget; service levels
high
Revenue
+33.7%
Trading Profit
+13.7%
Rm Trading Profit
Trading Margin
―
3.8%
3.3%
Bidvest Asia Pacific – All shoulders at the wheel
Appendix 2
New Zealand: sales up 15% to NZ$215.5m (real growth 7%), profits up 12% to NZ$9.9m; ROS
4.6% vs. 4.7%; growth from new products and market share gains; four consecutive quarters of
GDP decline; adequately provisioned against defaults;
― Fresh sales grow 12%, profits up 42%; cross selling with Foodservice working well
― Foodservice sales up 15%, profits up 10%; new branch planned;
― Logistics profits double; new Christchurch DC underway; capacity for growth
• Angliss: Asia markets in sharp downturn
― Singapore: Sales of S$166.46m (up 11%) but a small loss returned as trading in Q2
worsened; volumes static; high inventory coupled with falling meat and poultry prices
― Hong Kong & China: Sales up 27% to HK$866m, profits down 13% to HK$21.3m, ROS of
2.5% vs. 3.6%; dumping of stock widespread in a tight credit market; Chinese demand for
Western products slumps; medium term outlook still positive
•
Strategic imperatives & prospects
►Asian economies
in decline but trading expected to stabilise at lower levels in second half; pricing to
be keener; longer term objectives unaffected
►Australia: Maintaining staff morale key; ample scope to grow our market position and profits will be
higher in F2009
►New Zealand: team motivated to pressurise the opposition, profits will be up in F2009
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Bidfood – growing the basket in hard times
Appendix 2
Current contribution to
Group Trading Profit
8.3%
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Bidfood – growing the basket in hard times
Appendix 2
Results
►Strategy
to grow market share though expanded
variety, higher average spend per customer and higher
average value per drop is paying off as trading
environment tightens
►Caterplus: profits up 17%; expense control and cash
flow pleasing; capacity constraints hindered growth but
new facilities are being rolled out; strict credit policy
paying off; asset management tight
►Speciality: spending in the higher income category is
under pressure; customers are price resistant and
selective; own-brand Goldcrest grew sales 28% and
now accounts for a quarter of sales; the range
continues to be expanded and product promotion is
vigorous; stock availability and visibility is key
Revenue
+20.7%
Trading Profit
+16.9%
Rm Trading Profit
Trading Margin
8.5%
8.2%
Bidfood – growing the basket in hard times
Appendix 2
►Ingredients:
all business traded well, with the exception of NCP Yeast which was hampered by an
inability to pass through high input prices quickly enough; stock position under scrutiny due to
deflation risk; customers increasingly under liquidity pressure; technical base continues to strengthen
- alliances with suppliers
Strategic imperatives & prospects
►As mentioned
at the full year an outright reduction in prices is likely
►Quality custom is being emphasised at the expense of volume as bad debt risks rise
►Stock theft remains an issue and is being closely monitored as times get worse
►Bidfood will take advantage of harder times to improve market position and protect profitability and
liquidity
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Bid Industrial and Commercial Products –
Cooling
Appendix 2
Current contribution to
Group Trading Profit
12.4%
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Bid Industrial and Commercial Products –
Cooling
Appendix 2
Results
►Profits remain
relatively good in prevailing economic
conditions but there was a cooling off in the electrical
businesses; Waltons and Kolok performed very well
• Electrical Wholesaling: Voltex profits declined 5%;
the copper price fell by over 40%, precipitating a fall
in inventory levels; customers experience shrinking
orders; infrastructure and energy markets prioritised;
cost-cutting continues
• Stationery & Furniture: stationery put in a strong
performance but furniture was weak and
management actions are in place to ensure
rectification
― Waltons profits up 16%; store openings and
refurbishment continued; retail sector weak; “backto-school” yielded positive results
― Kolok profits more than doubled, assisted by a
weaker currency; focus on eliminating low-margin
business
― Internal challenges and a few own goals hindered
Furniture; however, product offering is competitive
Revenue
+8.2%
Trading Profit
-1.4%
Rm Trading Profit
Trading Margin
7.2%
6.5%
Bid Industrial and Commercial Products –
Cooling
•
Appendix 2
Packaging:
― Afcom GE Hudson profits up 15%. Optimal balance between local and imported product
assisted
― Buffalo Executape profits up 29%, benefiting from tight expense control
― Vulcan: profits up 18% in a competitive market as new products reinforce market position
Strategic imperatives & prospects
►Electrical Wholesaling:
Declining building market but infrastructure investment buoyant
• Escalating electricity price to assist energy saving solutions
• Copper prices bottoming out
►Stationery: relative resilience but not impervious to weak consumer spend
►Furniture: improvement expected following a weak first half
►Kolok: new business at higher margin aggressively pursued
►Vulcan: good first half, building on competitive strengths in a tough market
►Packaging closures: well positioned after a very good first half
•
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Bidpaper Plus – Silveray provides the light
Appendix 2
Current contribution to
Group Trading Profit
5.0%
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Bidpaper Plus – Silveray provides the light
Appendix 2
Results
►Improved
results from stationery distribution, labels
and packaging (now including Rotolabel), and the
consolidated label factories in Gauteng
►Traditional print was weaker and the laser and mail
business grew profits marginally
►Stationery grew market share, with Croxley regaining
prominence
►Business linked to retail market suffered
►Labeling & Packaging affected by downturn,
particularly in luxury items, but other sectors are being
pursued successfully
►Laser and mail on track to deliver on growth
Revenue
+14.4%
Trading Profit
+ 2.9%
Rm Trading Profit
Trading Margin
12.4%
11.2%
Strategic imperatives & prospects
►Innovation
a focal point as are export opportunities
►Diversity and mix of traditional and new technologies
should support results
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BidAuto – Hard driving
Appendix 2
Current contribution to
Group Trading Profit
8.2%
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BidAuto – Hard driving
Appendix 2
Results
►Slump in vehicle sales was substantially
worse than
forecast, resulting in the division being unable to hold
to an objective of maintained profits
►Timely diversification into fleet management paying
off
►Motor Retail profits down 90% after R30m closure
costs - down 70% excluding the charge
►Used vehicle sales up 11.7% to 23 523 units and new
unit sales down 24.2% to 17 730 units
►Burchmore’s produced pleasing results due to an
increase in bank repossessions and the success of its
“wholesale to the public” marketing programme
►Parts and service remained firm
►ICU committee formed to monitor loss-making
dealers; Meiya discontinued
►Many customers unable to procure financing due to
stricter credit granting criteria and NCA impact
Revenue
-11.7%
Trading Profit
-39.4%
Rm Trading Profit
Trading Margin
3.5%
2.4%
BidAuto – Hard driving
Appendix 2
►Disconnect between
OEM aspirations and sales reality has exacerbated dealer situation
►Heavy equipment exceeded budget
►Car and van rental grew profits 43% but below budget in what is a cut-throat market
►Import & Distribution incurred a loss due to demand well below expectation and currency effects
►Yamaha profits declined as customers cut-back on discretionary spend
►Increased impairments for doubtful-debts impacted McCarthy Finance but McCarthy Fleet Solutions
produced impressive profit growth
►Working capital improved markedly and stock levels reduced satisfactorily
Strategic imperatives & prospects
►Motor retail market likely to decline
further given the extent of global economic problems ; McCarthy
results are in sympathy with worldwide collapse in car industry
►Further corrective actions will be made to right size for current market
►Used car market and aftermarket service hold promise
►Import and distribution to remain challenging
►Working capital to be aligned with activity
►BidAuto will show substantially reduced profitability in F2009
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Corporate – Bricks & Fish
Appendix 2
Current contribution to
Group Trading Profit
7.3%
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Corporate – Bricks & Fish
Appendix 2
Results
►Bidvest Namibia profits
up more than four fold
►Namsov benefited
from better catches, firmer prices
and a weakening currency. All other businesses
performed as expected. The listing of Bidvest Namibia
is now anticipated to take place in the fourth quarter of
2009.
►Bidvest’s strategic
property holdings, worth
significantly more than book value, continue to be well
managed and grow
►Volume
transport business in UK-based Ontime
Automotive exited, depots rationalised within Rescue
and Recovery and a major Parking Solutions contract
wound down. A slowdown in the prestige vehicle
market adversely affected Specialist Transport
►Enviroserv investment
sold for a profit of R391.8m
Revenue
+ 24.0%
Trading Profit
+124.6%
Rm Trading Profit
Appendix 3
Historic Performance
30
Historic Performance - Year to June
Appendix 3
5.2%
5.2%
4.9%4.9%
4.5%
4.7%4.7% 4.5%
5.2%
5.2%
4.4%
4.4%
5.1%
5.1%
4.3%
4.3%
5.1%
4.6%
18% CAGR over 5 years
4.4%
18% CAGR over 5 years
31