Upload
others
View
1
Download
0
Embed Size (px)
Citation preview
Audited resultsfor the year ended 30 September 2018
Agenda
Significant matters03
Chairman’s remarks 01
Financial performance04
Segmental performance05
Outlook06
Overview02
Chairman’s opening remarks
JAYENDRA NAIDOOCHAIRMAN
Overview
LEON LOURENSCEO
Year in review
5
10.9%revenue growth to
R64.2bn
10.7%growth in operating
profit to R6.4bn(excluding one-off costs)
1.9%growth in operating
profit to R5.9bn(including one-off costs)
3.6%Growth in retail
space
R18bnrefinanced and
guarantees released
27.8 cents
per share maiden dividend declared
(dividend cover of 3 times)
What we do
Provide everyday productsAn extensive product range focusing on everyday needs
At affordable pricesBest price leadership ensures product differentiation
At customers’ convenienceLargest footprint in African market
The right product adds
value to customers’
lives
Customer loyalty
through value for money
Enhanced customer shopping
experience
6
Who we are
7
12African
countries5 200+
stores
2.4+million m2 total
retail space
48 000+employees
400+million
transactions annually 1 billion+
units sold
Who our customers are
88
It isimportant for our customers to look and feel good. We want to make their
lives better and easier.
Leon Lourens,Pepkor CEO
Everyone,
rich and poor,
deserves the same
access to products,
services and friendly
customer service from
people who treat
them with dignity
and respect.
Milestones achieved
9
Published 2017 full audited financial results
Strengthened board composition
Appointed new auditors
Retention scheme implemented
Completed refinancing and release from guarantee
Milestones achieved (continued)
10
Terminated SNH services
Pepkor name change
Credit book agreements
2018 audited financial results
New segmental reporting
Significant matters
LEON LOURENSCEO
1. Sourcing office
• CFH sourcing from PGS: 15% for Pep and Ackermans
FY18 sourcing of Clothing, Footwear and Home (CFH) via PGS
12
SA local35%
Imports65%
PGS29%
2. Tekkie Town
13
Like-for-like growth
-20%
0%
20%
3. Credit agreements
14
Build new book
Maintain profitability
Own the customer
experience
Terminate commercial relationship
with Fulcrum
1 2 3 4
4. Dividend policy
15
GearingCapital
commitmentsStrategic
investments
3 x cover
1 x net debt-to-EBITDA
Financial performance
RIAAN HANEKOMCFO
Highlights
COMPARABLE: FY18: Add-back of R511 million one-off costs / FY17: Use WANOS of 3 450 million
Revenue 10.9%
Statutory
to
R64.2bn
Operating profit 1.9%
to
R5.9bn
Operating margin 90 bps
to
9.2%
HEPS36.7%
to
84.5 cps
Revenue10.9%
Comparable
to
R64.2bn
Operating profit 10.7%
to
R6.4bn
Operating margin maintainedat
10.0%
HEPS4.2%
to
99.3 cps
17
Highlights (continued)
Refinanced 3
18
Cash generated
R5.3bn
Return on net assets
23.4%R18bn
Maiden dividend declared of
27.8c
Effective tax rate
38.4%
and guarantees released
Consumerfinance
Refinanced
27.5% excl. one-off costs
@ 3 times cover
Pepkor will collect existing loan books owned by CenCap:
Market-related collection fee
Capital investment required in FY19: R2.2bn
Consumer finance
19
➔
➔
➔
• JD secured credit: c.R1.6bn – average 27-month term
• Capfin unsecured loans: c.R1.7bn – average eight-month term
133,6
103,7 99,384,5
29,9
14,8
FY17 statutoryHEPS
Impact of 882mshares issued
FY17comparable
HEPS
FY18comparable
HEPS
Impact of one-off costs
FY18 statutoryHEPS
Comparability of earnings
-4.2%
Statutory vs comparable headline earnings per share (HEPS) – cents
20
Effective tax rate up
21
South African standard rate of taxation 28.0
FY18 %
Effect of other African countries’ tax rates 0.5
(Utilisation of unrecognised taxation losses)/taxation losses generated unrecognised 3.4
Withholding tax 3.3
One-off items 3.0
Other adjustments 1.2
Effective tax rate 38.4
New reporting segments
22
FinTech
10.6%
Segmental revenue growth
+10.9%
FY17 FY18
23
FY18 revenue segmental composition
FY18 – Rm
66%
8%
13%
13%57 850
7.2%
19.9%
35.5% 64 168
Credit sales
100%
82%92%
70%
92%
36%
86%
18% 8% 30% 8% 64% 14%
PEP & PEPAfrica
Ackermans Speciality Furniture Electronics &Appliances
Buildingmaterials
Pepkor group
Cash sales Credit sales
24
FY18 merchandise sales
Gross profit margin
25
• Increased markdowns and discounts
• Building materials discounts and reduced rebates
35.3%
FY17
34.5%
FY18
Other income
FY18
26
24.8%
Growth to
R875m
Insurance and other income25%
Distribution fee17%
Commission50%
Marketing and advertising
income8%
Other17%
Property26%
Personnel47%
Depreciation7%
Lowest cost of doing business
FY18
27
26.6%
CODBIncluding
one-off costs
25.8%
CODBExcluding
one-off costs
Segmental operating profit growth
FY18 – Rm
28
8.1%
5 815
6 43955.8%
5 928
(511)(11.9%)
10.6%
FY17 FY18comparable
One-off costs
FY18statutory
Before capital items
93%
4%3% 0%
FY18 operating profit segmental composition+10.7%
+1.9%
29
Goodwill and intangibles
R61.0bn
Net working capital
R5.4bn
Inventory
Trade receivables
Trade payables
+R1.9bn
+R1.1bn
+R0.4bn
Balance sheet considerations
-8
-6
-4
-2
0
2
4
6
8
FY18 FY19 FY20 FY21 FY22 FY23
Net debt
30
Net debt (contractual)
R12.6bn
Net debt-to-EBITDA
1.64
EBITDA: Interest cover
6.51
Net cash
R b
illion
s
Unutilised facilitiesDebt repayments
Cash generated from operations
31
5 8915 312
3021 134
489451
376
3 331
Operating profit
Debtors' cost Amortisation and
depreciation
Inventory write-downs
and provisions
Provision: One-off costs
Other non-cash
adjustments
Net changes in working
capital
Cash generated
from operations
FY18 – Rm
( )
Capex
32
2.9%R1 869m
Capex
% of revenue
Expansion
66%Replacement
34%
1.8%R1 134m
Depreciation
% of revenue
Segmental performance
LEON LOURENSCEO
Clothing & general
merchandise
8.0%Sales growth
3.3%Like-for-like sales
growth
4.5%CFH
deflation
9.0%Volume growth
5.0%Retail space
growth
PEP & Ackermans
35
2 231
Stores
97.5%Best Price Leadership
294mNumber of
transactions
12 000Number of employees
137New stores
opened
PEP
36
731
Stores
17%
Lay-byes
58mNumber of
transactions
7 000Number of employees
12%Credit sales
growth
Ackermans
37
80New stores
opened
No.1 Value Retailer for women with kids in their lives
-1.8%Sales growth
Number of employees
23mNumber of
transactions
PEP Africa
38
3 0003 000
Stores
347
12.5%Sales growth
14mNumber of
transactions
6 000Number of employees
82New stores
opened
Speciality
39
911
Stores
Furniture, appliances
& electronics
892
Stores
9.7%Sales growth
7 000Number of employees
Furniture, appliances & electronics
41
81
New stores opened
3.5mNumber of
transactions
Furniture, appliances & electronics
42
JD GROUP LIMITEDJD GROUP LIMITED
Furniture retail
Bedding Furniture
Appliances and electronics
Financial Services
Supply Chain ServicesSupply Chain Services
Mas
s m
arke
tTo
p-en
d
Dis
coun
tVa
lue
Nic
he
Building materials
-3.1%Sales
decline
124
Stores
7 000Number of employees
Building materials
44
General building
materials
SBM –Retail
SBM –Wholesale
1 2 3
FinTech
FinTech
46
145 000
Active traders
23m
Monthly consumers
2.8m
Daily transactions
Initiatives
LEON LOURENSCEO
Adult wear
48
Discount variety – Dealz
49
FMCG
50
PAXI
51
Cellular – direct imports
52
Outlook
LEON LOURENSCEO
Outlook
54
Store openings
Portfolio strategy
➔
➔
Back to retail
Future performance
➔
➔
Leadership and culture➔
Putting the customer at the centre
of whatwe do
Audited resultsThank you
PEP – Historic performance
57
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Revenue
Operating profit
19-yearCAGR15%
19-yearCAGR28%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Revenue
Operating profit
18-yearCAGR16%
18-yearCAGR23%
Ackermans – Historic performance
58