| Wed 27 Aug 2003, 9:48 | | Audited Annual Results for the year ended 25 June |
|
Imperial - Audited Annual Results for the year ended 25 June 2003
Imperial Holdings Limited
Registration number 1946/021048/06
Share code: IPL
ISIN: ZAE000003620
DELIVERING MOBILITY CREATING VALUE
AUDITED ANNUAL RESULTS for the year ended 25 June 2003
This announcement is available on the Imperial Holdings website at:
http://www.imperial.co.za
FINANCIAL HIGHLIGHTS
- Revenue up 15%
- Operating profit up 15%
- Headline earnings per share (basic) up 15%
- Final cash dividend of 140 cents
- Revenue exceeds R30 billion and profit before tax exceeds R2 billion
OPERATIONAL HIGHLIGHTS
- Car Rental and Tourism had an outstanding year. This division benefited from
the growth in tourism in South Africa and has emerged as Imperial"s biggest
contributor to pre-tax profits making a R474 million contribution.
- Excellent results from associate Imperial Bank, with assets in excess of R10
billion at year-end.
- An international AAA rating was awarded to bonds which were guaranteed by the
US Ex-Im Bank to finance assets leased by Safair Lease Finance.
INTRODUCTION
The diversification of Imperial Holdings within the transportation and mobility
sectors and the balance of the Group"s domestic and global businesses have once
again proven to be a resilient business model. The continued growth of
Imperial"s business and a relatively strong South African economy, has shielded
the Group from weakening global economic markets. Although the recent strength
of the Rand had a negative effect on certain of the Group"s businesses in the
second half of the year, its overall impact was fairly neutral.
During the year, Imperial"s various businesses focused strongly on finding ways
of continuing to add value to customers. Innovative solutions were initiated and
synergies between businesses were harnessed more effectively, thereby increasing
the volume of services taken by our customers.
FINANCIAL OVERVIEW
Growth during the year to 25 June 2003 was almost entirely organic and was
achieved in a relatively low inflationary environment, again reinforcing the
fact that acquisitions are not a prerequisite for Imperial"s growth and
demonstrating Imperial"s contra-cyclical nature of its divisions.
Income statement
Revenue for the period exceeded the R30 billion mark for the first time, an
increase of almost 15%, to reach R32.3 billion at the year-end.
Operating profit of R2.6 billion compared favourably with the R2.3 billion
achieved in the 2002 financial year. The operating profit increased by 13% in
Southern Africa and was up 53% in the rest of the world where R207 million
operating profit was achieved. The Group"s continuing strong market share and
management"s tight focus on containing operating expenses have improved
operating margins in most divisions. The gains were off-set by the
distributorships division"s margins being negatively impacted by currency
issues, and the insurance division"s margins being impacted by the weak equity
markets. This resulted in overall margins being maintained at 8.1%. Depreciation
after recoupments rose to R1.1 billion (2002: R1.0 billion). Net financing costs
increased by 11% to R555 million in line with the increase in interest rates and
debt. Interest cover was to a comfortable 4.5. Profit before tax increased by
20% to R2.2 billion (2002: R1.9 billion).
The Group"s tax rate rose to 30.8% from 27.1% in 2002, largely as a result of
lower exempt income. Attributable profit increased to R1.5 billion compared to
the previous year"s R1.3 billion. Headline earnings per share rose to 700.2
cents, an improvement of 15% on the 608.8 cents per share reported for 2002.
The Group"s return on equity (ROE) rose to 18.1% (2002: 17.7%). Five years ago,
this percentage was 14.3%.
The board is recommending a cash dividend of 140 cents per share, which when
added to the capital distribution of 125 cents a share for the interim period
will result in a total distribution of 265 cents per share for the 12-month
period, compared to last year"s distribution of 230 cents per share, an increase
of 15%.
Cash flow
Imperial has a robust cash generating ability. Cash flow generated by operations
amounted to R2.8 billion for the year. This shows a substantial improvement over
the interim figure of R1.0 billion.
The Group"s net working capital requirements amounted to R1.1 billion in the
financial year under review. This amount relates primarily to increased
inventories as the Group continued to position itself for growth and expansion.
The Group"s capital expenditure shows R1.1billion was dedicated to expanding the
business and R966 million was spent on the replacement of Group assets. As in
previous years, all expansion and acquisitions made during the year were
financed on a cash basis.
Balance sheet
Group assets increased by 8% to R21.6 billion, of which leasing assets comprised
R4.7 billion. The growth in assets was slower than in recent years due to the
sluggish local economy and low inflation. The transport fleet expanded by R325
million to R1.9 billion and vehicles for hire expanded by R155 million to R735
million.
R7.3 billion of Imperial"s assets are revenue producing fleets, including the
Group"s aircraft and vehicle fleets.
It is Group policy that all assets and liabilities are reflected on the balance
sheet.
Debt levels and gearing ratios are considered to be healthy notably because
Imperial has revenue producing fleets on its balance sheet that are quasi
banking type assets. The Group"s gross debt levels stood at R6.1 billion, with
net debt at R4.8 billion, resulting in gearing at 71% and 56% respectively. At
year-end, the Group held almost R1.3 billion in cash and cash equivalents. If
Imperial were to gear its R7.3 billion of revenue producing fleets in the same
way as a financial institution, it would more than absorb the Group"s total
debt.
Shareholders" interest in the total assets amounted to 40%. The Group
repurchased a net 4 million of its shares.
Inventories climbed by 28% due to the increases in aviation inventories and more
substantially vehicle inventories. The latter due to the large price increases
of vehicles and the periodic nature of the large orders placed by the
distributorships division. Illustrating the tight asset management practices
within the Group, receivables rose by 8%, a slower rate than the year before and
an improvement in relation to revenue reflecting improved debtors days.
OPERATIONAL REVIEW
Logistics and Transport remains Imperial"s largest division by revenue, with a
fleet of first-class assets and businesses that provide logistical solutions.
Revenues reached a new record at R11.9 billion (2002: R10.4billion). There was a
39.5% increase in operating profit to R618million (R443 million). The operating
margin increased to 5.2% (2002: 4.3%).
The Southern African operations drive to control costs and improve margins over
the last few years is bearing fruit. Revenue for the period under review was 23%
up to R5.2 billion. This reflected the increased effort in winning more
contractual business, which improved both the quality of business and levels of
profitability, resulting in the operating margin improving from 7.5% to 8.7%.
In Germany, where the bulk of the international division"s business is
conducted, operating profit improved notwithstanding the flat economy. Operating
profit improved by 30% in Rand terms, to R163 million compared to R125 million
in the previous year. Substantial contracts have been awarded to the Group, some
of an eight to 10-year duration. The business should now enjoy increased
profitability as the costs of setting up those contracts work their way out of
the system.
Leasing and Fleet Management reported a solid set of results although no major
contracts were awarded in the period under review. Revenue increased by 19.9% to
R1.9 billion (2002: R1.6 billion) and operating profit increased by 24.4% to
R500 million (2002: R402 million). The operating margin was 26.2% (2002: 25.3%).
Towards the year-end, a number of new corporate accounts were secured and many
existing customers extended their contracts as they recognised the benefits of
outsourcing their fleets. The division hopes that it will have some success in
the fleet management contracts currently out on tender.
Aviation Leasing achieved an excellent result in very difficult market
conditions due to its strong positioning, a well-balanced business portfolio and
a wide range of products and services. Although a stronger USD/ZAR exchange rate
impacted negatively on the division"s performance, it managed to increase
revenue by 8.6% to R2.2 billion (2002: R2.0 billion) and operating profit by
23.1% to R410 million (2002: R333 million). Its operating margin improved to
18.6% (2002: 16.4%).
The formation of Safair Lease Finance (SLF) a year ago has released Safair from
excessive burdens on its balance sheet and the strains experienced by the
resurgence in the strength of the Rand relative to the USD. It is an indication
of the quality of the Safair Lease Finance business generated that the United
States Export Import Bank guaranteed the bonds, which were awarded an
international AAA rating, issued to finance the purchase of three new Boeing 737
800 aircraft that were delivered to South African Airways.
The Car Rental and Tourism division delivered an outstanding result for the
year, buoyed by an excellent first half but with a slower second half
performance by Tourvest. Its revenue increased by 20% to R3.3billion (2002: R2.8
billion) and operating profit increased by 37.2% to R509 million (2002: R371
million). The operating margin increased to 15.3% (2002: 13.4%).
As Imperial"s largest contributor to pre-tax profits, Car Rental and Tourism
benefited from the rush of tourists to South Africa from the latter part of
2001, due to its status as a safe destination and an attractive exchange rate.
In the second half of the financial year, concerns over the war in Iraq, Severe
Acute Respiratory Syndrome (SARS) and the strengthening of the Rand resulted in
a slowdown of the growth.
The car rental operation showed good revenue growth over the past year with
rental days increasing by 13% and revenue by 25%. Most of the growth was
generated by the international incoming market and also as a result of increased
rental rates in this market. Auto Pedigree, the division"s used car retailer
also performed exceptionally well.
Tourvest"s outbound division enjoyed greater volumes as more South Africans
travelled abroad, taking advantage of a firmer Rand. However, the strength of
the Rand negatively impacted the inbound and retail operations, with both
experiencing slower growth. Due to its significant cash reserves and its strong
cash generating ability that will service future growth, the Tourvest board
elected to distribute most of its cash holdings of R388 million to its
shareholders. This will result in a dividend of R204 million to Imperial in the
month of September.
Distributorships has been negatively affected by the weakness of the Rand in
2001 and 2002 due to a lead time of several months when importing vehicles,
resulting in the Group holding stock priced at a higher exchange rate. While the
Group does take forward cover to address currency volatility, it is only
permitted to take cover once production commences. As it takes several months
for stock to arrive in South Africa, margins remain exposed. Due to
uncompetitive pricing, the division lost market share and margins came under
pressure. Although revenue increased by 3.8% to R4.5 billion (2002: R4.3
billion), operating profit decreased by 9.8% to R249 million (2002: R276
million) and the operating margin decreased to 5.5% (2002: 6.4%). In December
2002, Imperial disposed of a 51% interest in Renault, resulting in its
attributable profits being equity accounted from this date.
Motor Dealerships experienced strong vehicle sales in the first half of the
year, especially in the luxury vehicle market. However, in line with the
industry, vehicle sales slowed down during the latter six months due to higher
interest rates and affordability of vehicles.
Imperial"s strategy of providing a range of after sales services once again
sustained profitability. Revenue increased by 21.5% to R9.1 billion (2002: R7.5
billion) and operating profit improved by 11% to R302 million (2002: R272
million). The operating margin was 3.3% (2002: 3.6%).
Total vehicle sales across all the Group"s divisions remained unchanged,
excluding the effect of the Renault disposal. In total, Imperial sold 43 004 new
and 35 917 used vehicles.
Insurance businesses, which are focused on motor and motor-related cover,
achieved good underwriting profits/insurance results, but overall results were
impacted by poor investment markets and the strong Rand. The market linked
portfolios and their conversion to Rands resulted in a loss of R20 million,
compared to last year"s profits of R39 million. However, the businesses remain
well managed and have a secure position in their niche markets, resulting in
revenue increasing by 25.7% to R1.5 billion (2002: R1.2 billion).
The short-term company improved its underwriting result from R37 million to R46
million up 27%. The Life assurance company"s pre-tax profits went down from R49
million to R44 million even though its core insurance business performed better,
due to a negative swing of R47 million on the equity portfolios and their
conversion to Rand as noted above.
REVIEW OF ASSOCIATES
The Group"s share of attributable income from associates was R167 million.
Imperial Bank, in which the Group has a 49.9% shareholding is accounted for as
an associate. It had a very successful year, increasing its total assets to
over R10 billion for the first time. Profits after tax increased by 176% to R221
million (2002: R80 million). The Bank"s influence outside the Group continues to
grow with more than 50% of motor finance business written with non-Group
companies. With its sophisticated systems, the Bank has made progress in the
financing of complementary assets such as aviation and property and is entering
the financing of medical equipment. Bad debts were higher than anticipated as a
result of the high interest rate environment. Imperial Bank has provided
adequately for credit losses, with bad debt provisions amounting to 46% of
delinquent accounts, up 24% from a year ago. The cost to income ratio remained
at 34%, which compares favourably with banking sector norms of between 50%-60%.
Ukhamba Holdings, 49.9% held by Imperial, is our empowerment partner. It had a
successful year with revenues increasing by 29% from R52 million to R67 million.
Profits after tax of R7.8 million was 88% higher than the previous year"s R4.2
million.
Ikaheng Human Resources, one of its subsidiaries is a labour broker and focuses
on recruitment and training. It is accredited to provide driver training,
mechanical training and ABET courses. Its other businesses consist of Ukhamba
Fleet Services, Ukhamba Industrial Equipment, Rainbow Sanitation Services and a
Cell C franchise at the Johannesburg International Airport.
Safair Lease Finance is an aviation financing company with the capacity to
finance at least R5 billion in aviation assets. It contributed R20 million to
Group earnings during its first year of operations, despite high domestic
interest rates.
The Group"s various other associates contributed R33 million.
EMPOWERMENT
The Group is committed to advancing Black Economic Empowerment in an integrated
and coherent process that will directly contribute to the economic
transformation of South Africa and bring about significant increases in the
number of black people that manage, own and control the country"s economy. In
this regard Imperial contributed R15 million to Ukhamba (the associate referred
to above) some four years ago and considerable progress has been made by the
Group and Ukhamba in developing, training and creating wealth for historically
disadvantaged individuals, the Group and Ukhamba.
Imperial is now actively seeking to enhance and broaden empowerment by getting a
broad based constituency of stakeholders to own a meaningful stake in Imperial
Holdings. Senior executive resources are being devoted to achieve this.
PROSPECTS
The year ahead for Logistics and Transport in Southern Africa should yield
another solid performance as recent improvements in activity levels are expected
to continue into 2004. Imperial Logistics International aims to expand its
logistics services in its selected industries and to diversify into other
industries. Although operating in a depressed economy, it should perform well
due to its contracted future income and its focus on increasing the operating
margin. It is expecting a good year ahead.
Prospects for Leasing and Fleet Management remain positive in South Africa as
corporates and the public sector continue to increase their outsourcing of fleet
requirements.
Aviation Leasing is well positioned to take advantage of any upswing in its
markets. This division"s diverse product and services offerings in sectors such
as aid and relief, contract cargo operations and international corporate and
private individual markets are performing well. While market conditions remain
uncertain, the Group will remain conservative in terms of fleet growth. Earnings
are therefore likely to be flat for the next year, and management will
concentrate on providing the market with value-added services and further
improving efficiencies. Long-term prospects remain positive as outsourcing of
aircraft ownership and maintenance services increases.
Car Rental and Tourism has become one of the Group"s most important profit
generators. With its diverse brands and wide sector representation, it is well
positioned to prosper as South Africa realises its tourism potential. Provided
the global economy recovers, this division should again report good results next
year.
Over the past two years R250 million has been invested in Distributorships to
position the dealer network infrastructure for future growth. The recovery in
the value of the Rand has allowed distributors to keep vehicle prices relatively
constant, and the recent interest rate cuts have had a favourable impact on the
market as vehicle affordability has improved. If the Rand remains relatively
stable in the year ahead, the division should report improved profits.
The outlook for Motor Vehicle Dealerships is promising and the dealerships
should see further benefits from the growth of the South African economy.
However, in the short-term, margin pressure and new investment obligations from
manufacturers will counter an improvement in profits.
The lowering of interest rates and the hardening of the insurance market bodes
well for increased revenue in Insurance. An expected equity market recovery
should also result in improved profits in the year ahead.
Imperial Bank anticipates solid results for the next year, although the rate of
growth is likely to be lower than the record achieved in the year under review.
Imperial is cautiously optimistic about the outlook for its businesses. The
Group"s diverse operating base means that at a time when one business is under
pressure, there is every chance that another business will be flourishing
resulting in an above average result. Our business can probably be best
described as contra-cyclical. Imperial remains focused on its core operations in
the mobility and transportation industries and will continue to extract maximum
value from the cross marketing of integrated business solutions to customers.
Imperial commences the new financial year in good health. Domestic interest
rates are tending lower which will ease the pressure on the economy and it is
hoped that the Rand is entering a more stable phase. Imperial"s businesses are
resilient and well placed to prosper as the global economy begins its recovery.
The Group expects to report another year of good profit growth.
By order of the board
L Boyd, Chairman W GLynch, Chief executive
Johannesburg
26 August 2003
DECLARATION OF ORDINARY DIVIDEND NUMBER 19
Notice is hereby given that a cash dividend of 140 cents per ordinary share has
been declared and is payable to shareholders recorded in the books of the
company at the close of business on Friday, 26September 2003. In compliance
with the requirements of STRATE, the electronic settlement and custody system
used by the JSE Securities Exchange South Africa, the company has determined the
following salient dates for the payment of the dividend:
2003
Last day to trade cum dividend Thursday, 18 September
Shares commence trading ex dividend Friday, 19 September
Record date Friday, 26 September
Payment date Monday, 29 September
Share certificates may not be dematerialised/rematerialised between Friday,
19September 2003 and Friday, 26 September 2003, both days inclusive.
On Monday, 29 September 2003, the dividend will be electronically transferred
to the bank accounts of certificated shareholders that utilise this facility. In
respect of those who do not, cheques dated 29September 2003 will be posted on or
about that date. Shareholders who have dematerialised their shares will have
their accounts, held at their CSDP or Broker, credited on Monday, 29 September
2003.
On behalf of the board
R Mumford, Group Secretary
26 August 2003
INCOME STATEMENT
for the year ended 25 June
2003 2002 %
Rm Rm change
Revenue 32 277 28 122 15
Profit from operations before
depreciation and recoupments 3 776 3 305
Depreciation and recoupments (1 149) (1 021)
Operating profit 2 627 2 284 15
Foreign exchange (losses) gains (35) 59
Goodwill amortisation (67) (57)
Profit before net financing costs 2 525 2 286 10
Net financing costs (555) (500)
Income from associates and joint ventures 167 65
Profit before exceptional items 2 137 1 851 15
Exceptional items 97 3
Profit before taxation 2 234 1 854 20
Taxation 606 484
Profit after taxation 1 628 1 370 19
Minority interest 151 119
Net attributable profit for the year 1 477 1 251 18
Cents Cents
Earnings per share*
- Basic 718.7 588.6 22
- Diluted 716.9 585.1
Headline earnings per share*
- Basic 700.2 608.8 15
- Diluted 698.4 605.3
*Earnings per share reconciliation
Headline earnings per share 700.2 608.8
Goodwill amortisation (28.4) (24.0)
Profit on sale of property, plant and
equipment 4.5 2.0
Exceptional items 42.4 1.8
718.7 588.6
*Based on the weighted average number of
shares in issue.
Additional information
Net asset value per share (cents) 4 041 3 712
Number of shares (million)
- in issue 202.9 206.3
- weighted average 205.3 212.5
Income before taxation Rm Rm
This is stated after:
Crediting
Investment (losses) gains (20) 39
Net financing costs
Financial services businesses
Other operations
- paid 668 603
- received (112) (98)
- capitalised (1) (5)
- net 555 500
2003 2002
Exceptional items Rm Rm
Profit on disposal of Imperial Bank Limited 45 32
Impairment of assets (4) (8)
Profit (loss) on sale of investments in
subsidiaries and associates 56 (21)
97 3
COMPLIANCE WITH GAAP
The consolidated financial statements are prepared in accordance with and comply
with Statements of Generally Accepted Accounting Practice in South Africa
effective for the Group"s financial year.
The principal accounting policies adopted in the preparation of this report are
consistent in all material respects with those applied in the previous financial
year.
RESTATEMENT OF COMPARATIVES
The segment information has been restated for the distributorships division and
the motor vehicle dealerships division. Previously, imported franchise vehicles
that were retailed by the Group were included under motor vehicle dealerships.
As the sale of imported vehicles is managed separately from local franchise
vehicles and to measure the performance of imported vehicles more correctly, it
has been decided to combine the distribution and retailing of imported vehicles
under the distributorships division.
Inter-segment revenue has been adjusted to give effect to the above, as
previously sales between divisions were eliminated under the head office and
eliminations columns, whereas now the net revenue is shown within the division.
In prior years, insurance funds and provisions were disclosed net of reinsurance
recoveries. The gross amounts are now reported under insurance funds, accounts
payable and accounts receivable.
AUDIT REPORT
The comprehensive results have been reviewed by the Group"s auditors, Deloitte &
Touche. Their unqualified audit opinion thereon is available for inspection at
the company"s registered office.
BALANCE SHEET
at 25 June
2003 2002
Rm Rm
Property, plant and equipment 2 180 2 109
Intangible assets 504 606
Investments in associates and joint ventures 1 281 1 067
Other investments and loans 708 836
Deferred tax assets 247 348
Leasing assets 4 713 4 532
Transport fleet 1 881 1 556
Vehicles for hire 735 580
Inventories 3 551 2 772
Trade and other receivables 4 480 4 142
Taxation in advance 61 90
Cash and cash equivalents 1 298 1 472
Total assets 21 639 20 110
Insurance funds 566 428
Interest-bearing borrowings 6 135 5 901
Retirement benefit obligations 206 238
Deferred tax liabilities 531 489
Other liabilities 5 509 4 963
Total liabilities 12 947 12 019
Net assets 8 692 8 091
FUNDED BY
Ordinary shareholders" interest 8 199 7 658
Minority interest 493 433
Total shareholders" equity 8 692 8 091
Supplementary information
Investments in associates and joint ventures
At carrying value 607 429
Loans 674 638
1 281 1 067
Other investments and loans
Listed at market value 441 460
Unlisted at directors" valuation 57 187
Loans receivable 216 198
Capital expenditure 3 480 4 474
Capital commitments 299 285
Contingent liabilities 152 185
Lease commitments 1 379 971
CASH FLOW STATEMENT
for the year ended 25 June
2003 2002
Rm Rm
Cash flows from operating activities
Cash generated by operations before
changes in working capital 3 900 3 403
Net working capital movements (1 140) (595)
2 760 2 808
Net financing costs (555) (500)
Dividends paid (97) (265)
Taxation paid (240) (412)
Net cash flows from operating activities 1 868 1 631
Cash flows from investing activities
Acquisition of subsidiaries and businesses (35) (453)
Proceeds on sale of subsidiaries and businesses 133 (3)
Expansion of property, plant and equipment (336) (420)
Expansion of leasing assets (357) (1 273)
Expansion of transport fleet (316) (354)
Expansion of vehicles for hire (78)
Net replacement of property, plant and equipment (50) (58)
Net replacement of leasing assets (422) (277)
Net replacement of transport fleet (242) (92)
Net replacement of vehicles for hire (225) (263)
Net acquisition of intangibles (27) (17)
Additional investments in and loans from
subsidiary and associated companies, net
of disposals (85) 280
Purchase of equities and loans advanced (204) (660)
Proceeds on disposal of investments 337 737
Net cash flows from investing activities (1 907) (2 853)
Cash flows from financing activities
Cash flows from the issue of shares and repayment
of minorities 44 38
Purchase of treasury stock (206) (497)
Capital distribution (500) (227)
(Decrease) increase in long-term borrowings (200) 1 311
Net cash flows from financing activities (862) 625
Net decrease in cash and cash equivalents (901) (597)
STATEMENT OF CHANGES IN EQUITY
for the year ended 25 June 2003
Non-
Share capital distributable Distributable
and premium reserve reserve Total
Rm Rm Rm Rm
Balance at
25 June 2002 2 891 527 4 240 7 658
Net losses arising
on translation of
foreign operations
not recognised in
the income
statement (250) (250)
Net profit for the
year 1 477 1 477
Share of retained
earnings of
associates 115 (115)
Contingency reserve 11 (11)
Issue of 563 100
ordinary shares 20 20
Net purchase of
4 027 279 ordinary
shares (206) (206)
Capital distribution
of 120 cents per
share (247) (247)
Capital
distribution of
125 cents per
share (253) (253)
Balance at
25 June 2003 2 205 403 5 591 8 199
SEGMENTAL INFORMATION
25 June 2003
INCOME STATEMENT
Logistics Leasing
Group and and fleet
transport management
2003 2002 2003 2002 2003 2002
Rm Rm Rm Rm Rm Rm
BUSINESS SEGMENTATION
REVENUE
- Sales of goods 14 491 12 752 525 419 298 237
- Rendering
of services 16 461 14 324 10 809 9 616 1 482 1 177
- Gross premiums
received 1 204 933 0 0 0 0
- Interest income 52 38 0 0 0 0
- Dividend income 8 20 0 0 0 0
- Other 61 55 61 55 0 0
32 277 28 122 11 395 10 090 1 780 1 414
Inter-segment
revenue 460 307 125 175
32 277 28 122 11 855 10 397 1 905 1 589
Operating expenses 28 481 24 856 10 886 9 661 1 023 867
Realised and
unrealised losses
(gains)
on investments 20 (39)
Depreciation 1 366 1 157 419 364 432 359
Recoupments (217) (136) (68) (71) (50) (39)
Operating profit 2 627 2 284 618 443 500 402
Foreign exchange
(losses) gains (35) 59 (8) 32 (1) 3
Goodwill
amortisation (67) (57) (40) (35) 0 0
Profit before net
financing costs 2 525 2 286 570 440 499 405
Net financing costs (555) (500) (125) (97) (165) (123)
Income from
associates 167 65 21 20 0 0
Profit before
exceptional items 2 137 1 851 466 363 334 282
GEOGRAPHIC
SEGMENTATION
Revenue 32 277 28 122 11 395 10 090 1 780 1 414
- South Africa 24 386 20 942 4 449 3 618 1 401 1 058
- Rest of Africa 800 767 339 339 155 148
- Rest of world 7 091 6 413 6 607 6 133 224 208
Operating profit 2 627 2 284 618 443 500 402
- South Africa 2 311 2 056 443 305 417 340
- Rest of Africa 109 93 12 13 54 36
- Rest of world 207 135 163 125 29 26
Net financing costs 555 500 125 97 165 123
- South Africa 511 450 104 62 143 109
- Rest of Africa 30 34 12 21 15 10
- Rest of world 14 16 9 14 7 4
BALANCE SHEET
BUSINESS SEGMENTATION
ASSETS
Property, plant and
equipment 2 180 2 109 1 060 1 149 85 73
Intangible assets
(including goodwill) 504 606 259 348 16 20
Investments, loans
and associates 1 447 1 547 69 83 (8) 3
Leasing assets 4 713 4 532 2 175 1 916
Transport fleet 1 881 1 556 1 932 1 599
Vehicles for hire 735 580
Inventories 3 551 2 772 141 118 257 236
Trade and other
receivables 4 480 4 142 2 511 2 676 264 230
Cash in financial
services businesses 395 246
Operating assets 19 886 18 090 5 972 5 973 2 789 2 478
Deferred tax assets 247 348
Loans to associates
and other
investments 542 356
Taxation in advance 61 90
Cash and cash
equivalents 903 1 226
Total assets per
balance sheet 21 639 20 110
LIABILITIES
Insurance funds 566 428 0 0 0 0
Retirement benefit
obligations 206 238 206 238 0 0
Accounts payable and
provisions 5 072 4 736 2 238 2 479 450 377
Non-interest-bearing
liabilities 5 844 5 402 2 444 2 717 450 377
Interest-bearing
borrowings 6 135 5 901
Deferred tax
liabilities 531 489
Current tax
liabilities 437 227
Total liabilities per
balance sheet 12 947 12 019
GEOGRAPHIC SEGMENTATION
OPERATING ASSETS 19 886 18 090 5 972 5 973 2 789 2 478
- South Africa 16 537 14 841 3 844 3 650 2 100 1 822
- Rest of Africa 577 567 198 220 219 175
- Rest of world 2 772 2 682 1 930 2 103 470 481
NON-INTEREST-BEARING
LIABILITIES 5 844 5 402 2 444 2 717 450 377
- South Africa 4 511 3 754 1 369 1 296 328 267
- Rest of Africa 237 178 68 52 52 29
- Rest of world 1 096 1 470 1 007 1 369 70 81
INTEREST-BEARING
BORROWINGS 6 135 5 901 1 686 1 793 1 443 1 434
- South Africa 5 453 5 327 1 451 1 447 1 185 1 205
- Rest of Africa 302 296 72 167 132 91
- Rest of world 380 278 163 179 126 138
GROSS CAPITAL
EXPENDITURE 3 479 4 474 921 1 161 1 074 1 279
- South Africa 2 978 4 041 738 1 001 820 1 030
- Rest of Africa 178 122 52 29 106 69
- Rest of world 323 311 131 131 148 180
Gross capital
expenditure 3 479 4 474 921 1 161 1 074 1 279
Less: Proceeds
on disposal (1 429) (1 720) (227) (442) (359) (545)
Net capital
expenditure 2 050 2 754 694 719 715 734
SEGMENTAL INFORMATION
25 June 2003
INCOME STATEMENT
Car rental
Aviation and Distributor-
leasing tourism ships
2003 2002 2003 2002 2003 2002
Rm Rm Rm Rm Rm Rm
BUSINESS SEGMENTATION
REVENUE
- Sales of goods 775 783 1 122 992 3 678 3 691
- Rendering of
services 1 376 1 238 2 035 1 667 316 242
- Gross premiums
received 0 0 0 0 0 0
- Interest income 0 0 0 0 0 0
- Dividend income 0 0 0 0 0 0
- Other 0 0 0 0 0 0
2 151 2 021 3 157 2 659 3 994 3 933
Inter-segment
revenue 50 5 171 114 503 399
2 201 2 026 3 328 2 773 4 497 4 332
Operating expenses 1 619 1 520 2 624 2 218 4 208 4 017
Realised and
unrealised losses
(gains) on
investments
Depreciation 176 174 278 213 48 43
Recoupments (4) (1) (83) (29) (8) (4)
Operating profit 410 333 509 371 249 276
Foreign exchange
(losses) gains (24) 3 (1) 24 0 (3)
Goodwill
amortisation 0 0 (23) (23) 2 0
Profit before net
financing costs 386 336 485 372 251 273
Net financing costs (153) (159) (12) 1 (90) (87)
Income from
associates 33 15 1 2 (2) (14)
Profit before
exceptional items 266 192 474 375 159 172
GEOGRAPHIC
SEGMENTATION
Revenue 2 151 2 021 3 157 2 659 3 994 3 933
- South Africa 1 894 2 021 3 055 2 491 3 994 3 863
- Rest of Africa 0 0 98 96 0 70
- Rest of world 257 0 4 72 0 0
Operating profit 410 333 509 371 249 276
- South Africa 393 333 493 369 249 277
- Rest of Africa 0 0 16 17 0 (1)
- Rest of world 17 0 0 (15) 0 0
Net financing costs 153 159 12 (1) 90 87
- South Africa 153 159 15 0 90 85
- Rest of Africa 0 0 (1) 1 0 2
- Rest of world 0 0 (2) (2) 0 0
BALANCE SHEET
BUSINESS SEGMENTATION
ASSETS
Property, plant and
equipment 79 64 179 148 362 301
Intangible assets
(including goodwill) 12 3 210 225 1 1
Investments, loans
and associates 475 534 4 15 218 122
Leasing assets 2 311 2 425 234 198
Transport fleet
Vehicles for hire 741 589
Inventories 564 301 298 235 1 154 962
Trade and other
receivables 279 335 374 272 505 275
Cash in financial
services businesses
Operating assets 3 720 3 662 1 806 1 484 2 474 1 859
Deferred tax assets
Loans to associates
and otherinvestments
Taxation in advance
Cash and cash
equivalents
Total assets
per balance sheet
LIABILITIES
Insurance funds 0 0 0 0 0 0
Retirement benefit
obligations 0 0 0 0 0 0
Accounts payable and
provisions 427 469 535 475 689 303
Non-interest-bearing
liabilities 427 469 535 475 689 303
Interest-bearing
borrowings
Deferred tax
liabilities
Current tax
liabilities
Total liabilities
per balance sheet
GEOGRAPHIC SEGMENTATION
OPERATING ASSETS 3 720 3 662 1 806 1 484 2 474 1 859
- South Africa 3 650 3 662 1 771 1 433 2 474 1 859
- Rest of Africa 35 41
- Rest of world 70 10
NON-INTEREST-BEARING
LIABILITIES 427 469 535 475 689 303
- South Africa 408 469 522 443 689 303
- Rest of Africa 13 12
- Rest of world 19 20
INTEREST-BEARING
BORROWINGS 1 892 2 073 (72) (120) 707 666
- South Africa 1 801 2 073 (161) (157) 707 666
- Rest of Africa 89 36
- Rest of world 91 0 1
Gross capital
expenditure 64 939 897 630 417 444
- South Africa 20 939 877 606 417 444
- Rest of Africa 20 24
- Rest of world 44
Gross capital
expenditure 64 939 897 630 417 444
Less: Proceeds on
disposal (10) (40) (508) (298) (272) (320)
Net capital
expenditure 54 899 389 332 145 124
SEGMENTAL INFORMATION
25 June 2003
INCOME STATEMENT
Motor Head office
vehicle and
dealerships Insurance eliminations
2003 2002 2003 2002 2003 2002
Rm Rm Rm Rm Rm Rm
BUSINESS SEGMENTATION
REVENUE
- Sales of goods 8 091 6 620 0 0 2 10
- Rendering of
services 428 358 9 2 6 24
- Gross premiums
received 0 0 1 203 933 1 0
- Interest income 0 0 51 38 1 0
- Dividend income 0 0 8 7 0 13
- Other 0 0 0 0 0 0
8 519 6 978 1 271 980 10 47
Inter-segment
revenue 571 502 188 181 (2 068) (1 683)
9 090 7 480 1 459 1 161 (2 058) (1 636)
Operating expenses 8 761 7 183 1 307 1 052 (1 947) (1 662)
Realised and
unrealised losses
(gains) on
investments 20 (39)
Depreciation 31 26 7 8 (25) (30)
Recoupments (4) (1) (1) (1) 1 10
Operating profit 302 272 126 141 (87) 46
Foreign exchange
(losses) gains 0 0 (1)
Goodwill
amortisation 2 2 (1) 0 (7) (1)
Profit before net
financing costs 304
