Merrill Lynch Conference. Sun City March 2015

Transcription

1 Merrill Lynch Conference Sun City March 2015

2 Group revenue and operating profit split September 2014 Revenue Operating profit 2 50% 58% 50% 42% Equipment and Handling Equipment and Handling Automotive and Logistics Automotive and Logistics

3 Divisional overview Equipment southern Africa

4 Southern Africa revenue Sept Revenue by line of business New equipment sales by industry 6% 4% 9% 12% 28% 47% 43% 21% 30% New equipment Product support Mining Construction Used equipment Rental EMPR Contract mining Power

5 Southern Africa sales history Rbn % 43% 15 33% 10 28% 34% 36% 30% 46% 5 37% Equipment sales Product support

6 6 Orapa Cut 3 (2018) Moatize exp- Mota Engil (2016) Argent- Shanduka(2016)

7 7

8 Zambia FQM Kalumbila 8 Seventh Cat MD 6640 drill still to be shipped 2 Rope shovels and 2 drills currently undergoing final commissioning. Support team is in place that includes 9 local employees which are based on site. Aftermarket opportunity First Cat electric rope shovel to be delivered in Zambia

9 Namibia Swakop Uranium Husab Project All equipment commissioned and handed over on time by December 2014 (2 units scheduled for Sep 15) 9 Delivered fleet: 3 X Cat 7495 rope shovels 3 X 6060 hydraulic shovels 6 X blasthole drills 2 X electric motivators Customer support agreement in place Operator training onsite Technical training onsite Technical support team onsite Substantial parts investment on site Components of the Cat 6060 in transit Total contract value R1.3bn Assembled shovel and Barloworld Equipment team on site

10 Mozambique Vale Moatize Project Firm deal for 8 Cat 793D trucks and 1 Cat 6090 hydraulic mining shovel - approximate value US$ 42m 10 Vale forecast is to have a total of 90 large mining trucks by 2018 doubling of the existing fleet On site support structure of 90 people Investment of $11m in a new facility Cat 6090 Hydraulic Mining Shovel loading a Cat 797F truck The initial fleet is in first Planned Component Replacement cycle over the next 18 months - significant aftermarket opportunity Barloworld Equipment Mozambique s new branch in Tete

11 Mozambique Mota-Engil Africa Mota-Engil secured an 18 month contract with Vale Mozambique to initiate work for the Moatize II project in Tete 11 Order confirmed for: 13 x Cat 777G trucks 2 x Cat 6030 hydraulic shovels 1 x Cat 980H wheel loader Delivery and commissioning March/April 2015 The fleet is to be supported from our branch in Tete Cat 6030 Hydraulic Mining Shovel Total order value US$29.7m

12 Divisional overview Equipment Russia

13 Russia revenue profile Sept 2014 Revenue by line of business New equipment sales by industry 13 1% 5% 3% 10% 46% 10% 17% 48% 60% New equipment Product support Mining Construction Power Used equipment Rental Oil and gas Other

14 Russia sales history US$m % 33% % 46% 25% % 29% 36% % Equipment sales Product support

15 Operational update Equipment Russia Economic slowdown and difficult geopolitical situation continues Low oil price and weak rouble has adverse impact Limited direct impact of sanctions but increases complexity and compliance cost Aftermarket revenues continue to provide stable source of profitability Reduced headcount in selected areas Cost control initiatives and focused balance sheet management Positive cash flow generation driven by reduced working capital requirements EMPR continues to perform well on aftermarket side 15

16 Surface mining green field projects Opportunity Units US Dollars $172 m $293 m $280 m 16

17 Power of Siberia opportunity 17 Originally 3 major contractors expected to oversee the project: Stroytransgaz Stroygazmontazh Stroygazconsulting Gazprom decided to break down the project into smaller components and consider bigger group of contractors: 17 companies in total Includes some of VT s existing customers such as PBR, Sibmost and Irkutskneftegazstroy Further opportunity with subcontractors to these companies VT s approach: Coverage on site and in Moscow Mobilise stock in Lensk Concentrate on popular models Offer new and used equipment Already Sold: to BDSK 6 forestry units + 2 dozers to be delivered in March 2015 to PBR 5 construction units Estimated opportunity: 65 units in 2015 and 77 units in 2016

18 Divisional overview Equipment Iberia

19 Iberia revenue profile Sept 2014 Revenue by line of business New equipment sales by industry 19 17% 3% 8% 39% 48% 37% 41% New equipment Product support Mining 7% Construction Used equipment Rental Other Power

20 Iberia sales history EURm % 30% % % % 37% 33% 35% 41% Equipment sales Product support

21 Machine industry Spain Units

22 Operational update Equipment Iberia Macro economic conditions continue to improve, construction sector lagging Restructuring in Spain concluded in 2014 is yielding projected savings Restructuring costs of 0.7m incurred in Q1 to restructure Portuguese operations Market leadership position maintained Aftermarket revenues continue to support profitability Currently on track to achieve breakeven result to half year 22

23 Divisional overview Power systems

24 Long term prospects in Power remain positive Sentiment affected by oil price decline, Russia recession and slowdown in marine activity 24 Major projects Southern Africa Russia Iberia Large EP (gas & liquid)projects in SA, Angola and Moz Moz LNG in medium term Angola Sonaref refinery Power of Siberia pipeline Gas genset rentals Industrial Projects Data centres (Telefonica, PT) International oil & gas EPC projects Marine engine and propulsion system opportunities Industrial opportunities

25 Divisional overview Handling

26 Operational update Handling Agriculture SA continues to deliver good sales Strong order book in Mozambique despite post-election slowdown Negotiations with BayWa AG to form an agriculture JV in Zambia Russian operation impacted by recession & Rouble decline SEM product range expanded Hyster operation improves SA market share, however margins under pressure 26

27 Divisional overview Automotive and Logistics

28 Automotive and Logistics Division Strategic positioning 28 Customers Barloworld Automotive (Automotive Business model) Barloworld Logistics Car Rental Fleet Services Motor Retail Southern Africa Digital Disposal Solutions Freight Mangmt and Services Supply Chain Mangmt Supply Chain Mangmt Transport Solutions Communication, HR, IT, Legal, Finance, Sustainable Development, Strategy, Empowerment and Transformation, Risk Management, Business Development and Sales, Governance, Ethics and Compliance Inter-business unit synergies and cost efficiencies Apply Collective Wisdom Leveraging Automotive infrastructure to achieve critical mass for growth Retain strategic focus on each business unit

29 Sense of scale General Information 29 Employees Countries 16 Automotive Principals Avis Budget Group, Audi, BMW, Ford, General Motors, Jaguar Land Rover, Mazda, Mercedes- Benz, Toyota, Volkswagen. Car Rental locations >190 Wholly owned Motor Retail dealerships (SnA) 43 Key Indicators FY Sep 13 FY Sep 14 Rental Days 6.06m 6.66m New & Used retail units sold Total vehicles under management New vehicles sold per dealership per month DTS km s travelled FY m SAT tons shipped FY t

30 Operational review Strong result in a demanding trading environment Revenue: R31.1bn (FY 13: R28.8bn) up 8.1% Record operating profit R1 644m (FY 13: R1 322m) up 24% Operating margin for the year 5.3% (FY 13: 4.6%) All business segments performed well 30 Operating Profit (Rm) Margin Car Rental Motor Retail Fleet Services +33% +29% +16% 9.3% 7.8% 2.8% 2.4% 18.1% 16.7% Logistics +22% % 2.3%

31 Integrated business model delivers sustained value Well balanced Automotive portfolio and stable platform to grow logistics Revenue CAGR of 11.2% delivers operating profit CAGR of 26.6% over period Operating margins improved from 3.6% (FY2011) to 5.3% Targeted capital allocation supports sustained long term value creation The divisional platform and collective approach provides various inter-business unit synergies Rm Rm Operating profit Operating profit 1H Operating profit 2H Operating profit by BU Car Rental Motor Retail Fleet Services Logistics 31

32 Division overview Leadership continuity 32 Enhance return on equity Continued cash focus Targeted capital allocation Growing market share Optimising vehicle fleets (utilisation) Managing working capital levels Improving asset turn Expense management Controlling interest costs Implementing Logistics growth strategy Targeted growth opportunities across all units Exceeding customer expectations Integrate Budget Brand into existing car rental operations

33 % Growth Car Rental Improved rental days despite competitive market 33 Improved revenue per day Continued focus on operating costs Fleet utilisation remains well controlled Continued solid used vehicle profit contribution Sustained customer satisfaction above 90% Budget Brand Leading Indicators Jan '15 YTD Sep '14 YTD Rental Days Revenue per day Fleet Utilisation Fleet Size

34 Motor Retail Total South African Vehicle Market Passenger LCV M&HCV Source: Lightstone Auto & forecast by Dr. Neal Bruto

35 % Growth Motor Retail Fewer, Bigger, Better Strategy continues new vehicles sold per dealership per month (Sep 13: 75) Appropriate dealership footprint Focused brand strategy aligned to overall Automotive business model Improved operating margin through cost containment and margin expansion Continue strong OEM alignment Leading Indicators Jan '15 YTD Sep '14 YTD New Units Service Hours Parts Revenue F & I Net Profit

36 % Growth Fleet Services Pleasing performance in low interest rate environment Finance fleet growth slows post large contract roll-outs Strong growth in fleets under maintenance Continued strong used vehicle profits Awaiting adjudication on further tenders African growth: Ghana, Tanzania, Zambia in focus Leading Indicators Jan '15 YTD Sep '14 YTD Maintenance Fleet Finance Fleet Total Fleet

37 Logistics Well positioned for organic and acquisitive growth Barloworld Transport provides good operating profit contribution Extra heavy transport acquisition Sept 2014 enhances capability in the abnormal load transport business Barloworld Cranes business unit launched Ellerines finalised with no further impact International operations continue to face difficult trading conditions actions being taken Exited loss making Far East airfreight business in FY

38 Merrill Lynch Conference