Interim financial results Half-year ended December Presentation to Investors and Analysts February 2018

Transcription

1 Interim financial results Half-year ended December Presentation to Investors and Analysts February 2018

2 INTRODUCTION AND BUSINESS OVERVIEW Bidvest Namibia listed on 26 October 2009 on the Namibian Stock Exchange. Our shareholding is split as follows: Companies 8% Individuals 1% Other Pension and Provident Funds 14% Directors 1% The Bidvest Group Limited 52% Government Institution Pension Funds 11% Ovanhu Investments (Pty) Limited 13% 2

3 MAIN HIGHLIGHTS Majority of divisions experienced a decline in revenue. Fishing division sold another vessel: Capital profit of N$48,8 million. Horse Mackerel fleet now right-sized. Freight & Logistics improved trading profit, despite decline in revenue. Food & Distribution remains a concern. New management put in place. Automotive is also affected in its new vehicle sales by the pressure on the consumer. Used vehicle sales are making a growing contribution. Improvement in Customer Satisfaction ratings. Commercial and Industrial Services and Products improved trading profit despite revenue being flat. 3

4 BUSINESS OVERVIEW Bidvest Namibia Corporate/Properties/IT Automotive Bidfish Commercial & Industrial Services & Products Food & Distribution Freight & Logistics 4

5 FINANCIAL REVIEW

6 THE KEY 2018 NUMBERS REVENUE 9,8% to NAD1,8bn TRADING PROFIT 79,9% to NAD4,4m 31,3% to 12,6cps EPS (cps) HEPS (cps) 129,5% to -2.5cps DIVIDEND (cps) No interim dividend NET TANGIBLE ASSET VALUE (cps) 2,5% to 745cps 6

7 FINANCIALS - CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND COMPREHENSIVE INCOME Half-year ended December Note: IFRS compliant Unaudited Unaudited % Change NAD000 s Revenue ,8% Gross profit % Gross profit margin % 14,3% 14,3% Other income ,4% Trading profit ,9% Trading profit % 0.25% 1.1% Revenue under pressure Expenditure was cut but not sufficient for loss in revenue Average 1 USD = N$13.45 compared to the prior year rate of N$

8 FINANCIALS - CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND COMPREHENSIVE INCOME Half year ended December Note: IFRS compliant Unaudited Unaudited % Change NAD000 s Profit before tax ,0% Taxation (13 967) (1 646) 748,5% Profit for the period ,4% Profit attributable to non-controlling interest ,9% Profit attributable to shareholders of the company ,7% Headline earnings (6 060) ,5% HEPS (cps) (2.9) ,5% Dividends (cps) 0,0 4,0 8

9 FINANCIALS - CONSOLIDATED STATEMENT OF FINANCIAL POSITION Half year ended December Note: IFRS compliant Unaudited Unaudited % Change NAD000 s Non-current assets ,2% Current assets ,5% Total assets ,9% Capital and reserves ,8% Non-current liabilities ,7% Current liabilities ,9% Total equity and liabilities ,9% Current assets/current liabilities 2,6 2,6 Current ratio still reflecting strong liquidity 9

10 FINANCIALS - CONSOLIDATED CASHFLOWS 2017 N$ million Cash generated by operations before working capital changes 2016 N$ million Working capital utilised Net finance income (95.90) 1.80 Taxation paid 6.60 (31.60) (46.20) (119.40) Distributions (87.60) Cash flows of investment activities (25.20) Cash flows from financing activities (150.00) (100.00) (50.00) (150.00) (100.00) (50.00)

11 FINANCIALS - SEGMENT REVENUE REVENUE 2017 REVENUE 2016 Automotive 14% 1% 18% Fishing 12% 1% 20% Freight and Logistics 34% 26% Food and Distribution 33% 27% 7% Commercial and Industrial Services and Products Corporate Services and Properties 7% 11

12 FINANCIALS - SEGMENT TRADING PROFIT 20,000 16,493 15,000 10,000 7,981 11,073 9,233 5,000 4,255 3,878 5,501 3,547 - (5,000) Automotive Fishing Freight and Logistics Food and Distribution Commercial and (2,134) Industrial Services and Products Corporate Services and Properties (10,000) (8,452) (9,214) (15,000) (20,000) (15,975) Trading Profit 2017 Trading Profit

13 HISTORIC PERFORMANCE Headline earnings per share Dividends per share H1 H H1 H2 13

14 AUTOMOTIVE

15 AUTOMOTIVE Decline in new vehicle sales Lowest automotive industry rolling 12 month vehicle sales performance for the past 5 years Net Revenue from combined new vehicle sales dropped by 32% compared to same period in the previous financial year Halt on Government spending Slowdown in consumer spending due to current economic climate Tighter credit conditions (Credit Act amendments) and indebted customers Depressed business and consumer confidence Ford Finance offerings in joint venture with Standard Bank Namibia introduced close to the end of the six month period 15

16 AUTOMOTIVE Improved Used vehicle retail sales volumes (49.65%) compared to the same six months of the previous financial year Focus on after sales Improved work hours Improved productivity Improved efficiency Maintain and further improve healthy Customer Satisfaction ratings Focus on improved finance and insurance income opportunities and accessory sales through the fitment centre Focus on the cost absorption model to be less reliant on the contribution from new vehicle sales 16

17 AUTOMOTIVE OUTLOOK Take on the Automotive business Novel Motor Company New satellite showroom opened in the southern part of Windhoek and the Ford Finance offerings Used vehicle focus A shift in the market from new to used Aftersales Focus on customer satisfaction Improved activity at the service centres as consumers increase spend on parts and servicing to extend the life of vehicles 17

18 BIDFISH

19 BUSINESS OVERVIEW - BIDFISH Namsov Fishing Enterprises (Horse mackerel) Namibia Sea Products (Pelagic) Tetelestai (Aquaculture) 69.55% 69.55% 69.55% Pesca Fresca (Pelagic Angola) Carapau (Horse Mackerel) Industria Alimentar Carnes De Mocambique 34.08% 17.38% 27.82% 27.82% 25% 19

20 BIDFISH Horse mackerel Vessels were sold to right size extraction capacity in line with the current and expected future quota allocations; Quota allocations remain a constraint; purchase of available quota is expensive and feasibility is considered prior to purchases; Catch rates and size mixes have deteriorated year on year; Market prices are under severe pressure, consumers with restricted purchase capacity lean to cheaper fish and other protein products Angola Local sardinella market remains stable; Repatriation of profits remain challenging; Strong fishmeal sales return; Currency fluctuations and the devaluation of the Kwanza have impacted profitability; Vessel breakdowns negatively affected catch volumes 20

21 BIDFISH Pilchards Catches remained poor due to bad weather and weak resource; Cannery remained closed Aquaculture One vessel was sold resulting in decreased operational cost; Downsized and streamlined business to sustainable size; Moved from open ocean farming to salt pans to reduce the environmental threat to biological assets Glenryck Volumes are picking up Mozambique Currency fluctuations have impacted profitability 21

22 BIDFISH OUTLOOK Take on the individual fishing businesses Namsov, Carapau (Horse Mackerel) Namsea (Pilchards) Twafika (Monk) Comet / Pesca Fresca (Angola) Tetelestai (Oysters) Downstream Distribution Mozambique JV 22

23 BIDFISH OUTLOOK Equity Bidvest Namibia is evaluating all fishing assets and has entered into negotiations to sell some of its fishing interests. Horse mackerel Increases to quota levies, observer fees and the introduction of an export levy by government place continuous pressure on profitability; Angola Currency issues and repatriation of profits remains challenging; Maintain infrastructure and vessels to ensure optimal profitability Pursuing options to disinvest in Angola Pilchards MFMR placed a 3-year moratorium on pilchard catches ( ) Sell purse seine vessels, property and buildings Tetelestai Expected to be stable in the future due to downscaling to controllable size 23

24 BIDFISH OUTLOOK Mozambique Pursuing options to disinvest in Mozambique Glenryck Transfer ownership of Glenryck brand and trading company to Bidvest Namibia Limited Profits are expected to flow from this venture in the future 24

25 COMMERCIAL AND INDUSTRIAL SERVICES AND PRODUCTS

26 CISP COMMERCIAL AND INDUSTRIAL SERVICES AND PRODUCTS Cecil Nurse had a fair year-to-date Kolok showed a slight improvement from last year Minolco performed extremely well copy-clicks on the rise and increased business from internal rentals rather than outright sales Plumblink has expanded by opening a branch in Swakopmund Rennies Travel performed in line with prior year despite some overrides still outstanding Steiner has done well in line with prior year with a growing hygiene rental customer base and the added pest control services Voltex continues to struggle in a very competitive market. The construction industry has come to a halt and has had a negative impact on the turnaround efforts. However, losses are being reduced. Waltons has had a stable year given the downward spending of consumers Prestige Bidvest Namibia has taken over Prestige, a leading cleaning agency with contracts in all industries, with > 500 employees 26

27 CISP OUTLOOK Take on the Commercial businesses Cecil Nurse Kolok Minolco Plumblink Rennies Travel Steiner Voltex Waltons Prestige 27

28 CISP OUTLOOK The economy is suffering and its affecting all commercial entities Consumer and Government spending has been down and is expected to remain so for the ensuing year Growth is therefore not to be expected in the current entities, unless it is of an acquisitive or expanding nature The aim is to remain competitive and to be the preferred supplier to the nation 28

29 FOOD & DISTRIBUTION

30 FOOD AND DISTRIBUTION Taeuber & Corssen A slowdown in consumer spending Distribution agreement with Parmalat ended end of August 2017 Inefficiencies not yet resolved New management in place busy restructuring business and processes Major initiative is to enhance the information technology environment 30

31 FOOD AND DISTRIBUTION OUTLOOK Take on the Food and Distribution businesses Taeuber & Corssen Attention is being given to the inefficiencies. Fleet management system to improve efficiencies on trucking and the utilisation of available trucks. Less trucks have been put onto the roads, reducing fleeting costs to a minimum Stock management system 31

32 FREIGHT AND LOGISTICS

33 FREIGHT AND LOGISTICS Continued low levels of project activity Project activity in Luderitz lead to additional profit in period under review Ongoing cost saving measures remain in place Continue to pursue Oil & Gas opportunities 33

34 FREIGHT AND LOGISTICS OUTLOOK Take on the Freight and Logistics businesses Manica Group Namibia Focus remains on containing costs and to compact the business Simultaneously a drive to secure projects is underway 34

35 CONCLUSION