TIDM51NI
RNS Number : 9040R
Bidvest Group (UK) PLC (The)
06 March 2023
Tickers: 52AX, 51NI
The Bidvest Group (UK) PLC
3.625% SNR NTS 23/09/26
The Bidvest Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1946/021180/06)
Share code: BVT SJ
ISIN ZAE000117321
("Bidvest" or the "Company" or "guarantor")
UNAUDITED FINANCIAL RESULTS AND CASH DIVIDEND DECLARATION FOR
THE SIX MONTHS ENDED 31 DECEMBER 2022
SALIENT FEATURES
ZAR57.2 billion revenue, +14.0%
ZAR5.8 billion trading profit, +14.5%
ZAR7.3 billion cash generated by operations before ZAR5.5
billion investment in working capital
ROFE 37.6%
HEPS 938.5 ZAcents, +15.3%
Normalised HEPS 983.4 ZAcents, +15.3%
Interim dividend of 437.0 ZAcents, +15.0%
Introduction
Bidvest delivered an impressive first half result by
capitalising on growth nodes within the agriculture, mining,
renewable energy and travel and tourism industries. Organic growth
has been strong, notwithstanding various global macro-economic
pressures. The financial strength of the Group remains key to
successfully advancing and competing in these sectors, while also
pursuing overall strategic growth.
Trading profit grew by 14.5% to ZAR5.8 billion, with ZAR1.1
billion contributed by the international operations. Robust cash
generation of ZAR7.3 billion was delivered before investing ZAR5.5
billion in working capital. Capital investment of ZAR1.5 billion
was made into the operations to upgrade facilities and maintain
assets while ZAR2.3 billion was used for acquisitions.
The expansion of Bidvest's facilities management footprint into
Australia, effective 7 July 2022, delivered in line with
expectations. Pleasingly, the pipeline of strategic growth
opportunities is active across the Group.
Financial overview
At the start of the financial year, against a backdrop of
unprecedented inflation, margin management was a key focus area.
The team delivered with both gross (29.4%) and trading profit
(10.2%) margins remaining stable compared to the prior period. This
is commendable considering the inflationary trading environment and
incremental energy and distribution costs.
Despite an already high base, six out of the seven divisions
delivered real trading profit growth with many individual
businesses producing record months during the six months under
review. The continuation of strong demand for bulk, mineral and
agricultural, commodities, as well as higher Liquid Petroleum Gas
(LPG) volumes, benefitted the Freight terminal operations, while
clearing and forwarding activity recovered strongly. The expected
revival in tourism volumes materialised, notwithstanding continued
air travel capacity constraints, resulting in excellent
performances from the Group's travel and hospitality-related
businesses. Coming off record high bases, both Commercial Products
and Branded Products, delivered strong results as many of the
underlying businesses gained market share by trading in
sought-after products, while simultaneously managing margins well.
The expected improved performance from Financial Services
materialised and margin discipline in Automotive continued.
Services International's largely unchanged financial result was
commendable, given the businesses realigning following the
extraordinary Covid-related work in the prior year, while augmented
by the inclusion of BIC for six months.
HEPS and Normalised HEPS(1) , a measurement used by management
to assess the underlying business performance, grew by 15.3% to
938.5 cents and 983.4 cents, respectively.
Return on Funds Employed (ROFE) was slightly down at 37.6% at 31
December 2022 (1H FY2022: 40.4%) given the working capital
investment. Return on Invested Capital (ROIC) of 16.3%, compares
favourably to 15.5% as at 31 December 2021, and remains above the
Group's weighted cost of capital.
Group NAV grew from ZAR81.62 in the prior period to ZAR89.88 as
at 31 December 2022.
(1) Normalised HEPS, which excludes acquisition costs and
amortisation of acquired customer contracts, is a measurement
management uses to assess the underlying business performance
Prospects
Activity in renewable energy, mining, agricultural, tourism and
hospitality-related sectors is expected to remain healthy. Planned
investments into alternative energy to mitigate the impact of the
electricity crisis in South Africa will continue. Consumer
disposable income pressure is anticipated to intensify throughout
the calendar year. Demand for select bulk commodities is expected
to remain robust, supporting terminal activity in the southern
African ports. The improved performance from Financial Services
should gain momentum.
We will remain disciplined on margin generation, nimble in
offering a differentiated product and/or service offering and
focused on expense management as competition intensifies, together
with declining economic growth, suboptimal infrastructure as well
as labour cost pressures.
The recent acquisitions are performing in line with expectations
and growth opportunities have been identified to add incremental
value. Several corporate action opportunities are currently being
actively pursued and discussions continue with regards to capital
intensive partnership opportunities in South Africa. The Group
balance sheet remains able to support its growth strategy.
Dividend declaration
In line with the Group dividend policy, the directors have
declared an interim gross cash dividend of 437.00000 ZAcents
(349.60000 ZAcents net of dividend withholding tax, where
applicable) per ordinary share for the six months ended 31 December
2022 to those members registered on the record date, being Friday,
31 March 2023. The dividend has been declared from income reserves.
A dividend withholding tax of 20% will be applicable to all
shareholders who are not exempt.
Share code BVT SJ
ISIN ZAE000117321
-------------------------
Company registration number 1946/021180/06
-------------------------
Company tax reference number 9550162714
-------------------------
Gross cash dividend amount per
share 437.00000
-------------------------
Net dividend amount per share 349.60000
-------------------------
Issued shares at declaration date 340 274 346
-------------------------
Declaration date Monday, 6 March 2023
-------------------------
Last day to trade cum dividend Tuesday, 28 March 2023
-------------------------
First day to trade ex-dividend Wednesday, 29 March 2023
-------------------------
Record date Friday, 31 March 2023
-------------------------
Payment date Monday, 3 April 2023
-------------------------
Share certificates may not be dematerialised or rematerialised
between Wednesday 29 March 2023 and Friday 31 March 2023, both days
inclusive.
Regulatory requirements
The contents of this short-form announcement are the
responsibility of the Board of directors of the Group. These are
the summarised results of the full announcement for the half year
and do not contain full or complete details of the financial
results. Any investment decisions made by investors and/or
shareholders should be based on consideration of the full
announcement as a whole and shareholders are encouraged to read the
full announcement which is available for viewing on the Company's
website (www.bidvest.co.za) and
https://senspdf.jse.co.za/documents/2023/jse/isse/BVT/1HFY2023.pdf
The full announcement is available for viewing on the Company's
website and for inspection at the registered office of Bidvest,
Bidvest House, 18 Crescent Drive, Melrose Arch, Melrose,
Johannesburg, 2196, South Africa and at the offices of Bidvest's
sponsors, Investec Limited, 100 Grayston Drive, Sandown, Sandton,
2196, South Africa. at no charge, during normal business hours from
6 March 2023.
The information in this announcement has been extracted from the
Interim Condensed Consolidated Financial Statements. The results
have not been audited or reviewed by the Group's auditors and have
been prepared under the supervision of the Chief Financial Officer,
MJ Steyn, BCom CA (SA).
Date: 6 March 2023
Johannesburg
Board of Directors
For additional information, please contact:
Ilze Roux, Bidvest Executive: Corporate Affairs, +27 11 772
8745, ilze.roux@bidvest.co.za
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END
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