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Imperial Holdings Limited - Unaudited Interim Results For The Half Year Ended 25
December 2004
Imperial Holdings Limited
(Registration number 1946/021048/06)
Share code: IPL ISIN: ZAE000003620
Delivering mobility
Creating value
UNAUDITED INTERIM results
for the HALF YEAR ended 25 December 2004
The results announcement is available for viewing on the Imperial Holdings
website: http://www.imperial.co.za
Financial highlights
- Headline earnings per share up 28% to 470 cents
- Revenue up 20% to R20.9 billion
- Cash flows from operating activities up 31% to R1.1 billion
- Distribution to shareholders up 25% to 175 cents
Introduction
The past six months were characterised by high consumer spending buoyed by low
interest rates, good economic growth, low inflation and a strong rand. Within
this environment Imperial has posted a fine performance, with revenue growing by
20%, operating profit increasing by 34% and headline earning per share up by 28%
to R4.70.
Cash generation remained solid, with operating cash flow after accounting for
replacement capital expenditure almost trebling. The group`s ROE once again
improved, with the return for the 12 months to December 2004 being 21.6% (2003:
18.6%).
The key operational highlights for the period included strong trading patterns
in the passenger and commercial vehicle market in South Africa, the strong
investment and underwriting performances of our insurance businesses and a solid
performance by our logistics division, particularly in Europe. The strong rand
negatively affected the performance of our interests in the aviation and tourism
markets in particular whilst lower interest rates and flat market conditions
hampered growth in the leasing and fleet management division.
During the six months under review the group successfully completed a number of
initiatives aimed at growing our business. The range of brands we distribute was
expanded by adding Renault Trucks, Tata Motors and MV Agusta, Cagiva and
Husqvarna motorcycles to the portfolio. The group also acquired six motor
dealerships, including Brenners, and was awarded an additional four new
franchises. A total of 21 used vehicle dealerships were added to the network
under the HyperCar, Auto Pedigree and Imperial Pre-owned brands. Across the
group, we retailed 36 376 new vehicles, up 46% over the prior period, and 22 069
used vehicles, an increase of 14%.
The aviation division acquired Naturelink, an aviation service, sales and
contract operations business and NAC was awarded the distribution rights by
Raytheon for the United Arab Emirates. The logistics division formed Mercor
Solutions, which is a fully integrated merchandising business offering value
added supply chain solutions to the chilled foods industry.
The group also disposed of its 33% interests in DAWN Limited to Ukhamba and
Tourvest sold its interest in Starlight Cruises.
Subsequent to the end of the period the group received an upgrade of its foreign
currency credit rating by Moody`s Investors Service to Baa1. We have also
announced that subject to regulatory approvals, the group has acquired nine Ford
dealerships in the Sydney metropolitan area in Australia.
The board approved an interim capital distribution of R1.75 per share,
representing a 25% increase over the distribution of R1.40 per share in 2003.
Financial results
Income Statement
The group`s revenue increased by 20% over the previous period, driven by buoyant
conditions in the motor retail market and a general improvement in economic
conditions in South Africa. Revenue from South African operations increased by
22%. Whilst the vehicle distribution business benefited from the ongoing
strength of the rand, it continued to exert pressure on revenues from aviation
and tourism, as well as the conversion of revenues and profits from the group`s
operations outside South Africa.
Profitability grew strongly during the period, with operating margins improving
from 7.6% to 8.5%, resulting in a 34% improvement in operating profits. This was
achieved after recognising an additional R43 million impairment of the group`s
aviation fleet, following a further strengthening of the rand against the US
dollar during the period.
Foreign exchange losses amounted to R16 million up from the prior period`s R4
million and negative fair value adjustments on foreign exchange derivatives were
R71 million against R17 million in the comparable period in 2003, mostly due to
the fair valuing of forward exchange contracts following the strengthening of
the rand. The rand closed at R5.66/USD at the end of the period, versus
R6.32/USD at June 2004.
Despite lower borrowing rates and relatively stable levels of debt, net interest
costs increased by 9% to R309 million. This was mainly due to negative fair
value adjustments to long-term debt instruments of R57 million compared to a
positive adjustment of R9 million in the prior period.
The contribution by associates declined by 30%, principally due to the
impairment of the aviation fleet in Safair Lease Finance and lower profits in
Imperial Bank.
The group made a net exceptional profit of R21 million, which included our share
of the profit on disposal of our interest in DAWN Limited of R24 million. The
group`s effective taxation rate declined to 31.3% from the prior period`s 34.2%,
which included an unusually high STC charge.
Net attributable profit grew by 33% to R960 million and earnings per share rose
by 34% from R3.57 to R4.80 benefiting marginally from the effects of share
buybacks. Diluted headline earnings per share increased by only 21% primarily as
a result of deferred ordinary shares issued to Ukhamba Holdings (Pty) Limited.
Balance Sheet
The group`s balance sheet remains strong. During the year total assets grew year
on-year by 11% to R25.8 billion driven by growth across the asset base.
Net debt amounted to 65.1% of equity at the end of the period against 72.0% at
the same time last year.
Cash Flow
The cash generation of the group continued to improve compared to the
corresponding period. Cash flow from operations increased by 31%. The increase
in working capital since June 2004 amounted to R843 million against an increase
of R535 million in the same period last year. This was influenced by a seasonal
increase in working capital and increased activity levels.
Free cash flow, defined as cash flow from operating activities after replacement
capital expenditure amounted to R586 million, against R204 million in the prior
period. This equates to 62% of our headline earnings (2003: 27%). Cash
conversion in the first half of the financial year is normally not as strong as
for the full year due to the greater seasonal investment in working capital.
Replacement capital expenditure declined by 22% to R468 million, benefiting from
past investments in capital goods. Expansion capital expenditure more than
doubled to R1.1 billion. Most of the expansion capital expenditure was spent in
our logistics, aviation and distributorship divisions.
Review of divisions
Logistics
The logistics division performed well in a competitive environment. In South
Africa, strong economic growth aided performance, whilst the strong rand
negatively impacted our exporting customers and our cross-border operations. Low
inflation also resulted in an inability to pass on all cost increases. In Europe
economic conditions remain subdued, but our business performed exceptionally
given the circumstances. Unfortunately the strong rand, on conversion, diluted
the impact of the performance in Europe.
Our South African operations` revenue grew by 9% despite low inflation and
operating margins improved from 8.3% to 8.7%. Operating profits grew by 14% to
R277 million. Whilst it has been difficult to recover all cost increases in the
current low inflation environment, increased activity levels and a strong
consumer market aided growth. This, together with improved efficiency levels
assisted the improvement in profitability.
Imperial Logistics International improved its performance markedly over last
year. In Euro terms, revenue increased by 10.6% and operating profit improved by
124%. A focus on efficiency levels and the benefits of maturing contracts
resulted in a significant improvement in operating margins, from 1.9% last year
to 3.2% in the period under review.
All the business units in Europe performed better. JH Bachmann and Neska both
gained from new business volumes, while Imperial Reederei`s focus on efficiency
improvements resulted in profit gains. Panopa`s investments of the recent past
reached full profitability after the initial start up phase.
Leasing and Fleet Management
In volume terms the South African vehicle leasing market remained relatively
flat year-on-year. Within this context our fleet grew by 7% to 25 605 units
since June 2004, as we secured new contracts with the Namibian government and a
large South African metropolitan authority.
Our revenues grew by 23%, whilst operating profit declined by 2% to R241
million. Margins declined from 23.8% last year to 19.0%. A changing sales mix
was the main reason for the margin decline as Hypercar, which disposes of our
off-lease vehicles, expanded its presence to 17 dealerships from six during the
prior corresponding period. Its revenue increased by 149%. In a declining
interest rate environment, the division`s pre-tax contribution was also affected
by the high proportion of fixed rate funding used to fund our fleet, compared to
a greater proportion of variable rate fleet contracts with customers.
Market conditions remained tough, with low interest rates affecting interest
rate margins, market volumes remaining relatively static, which intensified
competitive forces. Whilst there remains much scope for public sector fleet
outsourcing, progress remains slow. Leasing to private consumers, which may be
introduced, provides significant longer term opportunities, from which we are
well positioned to gain.
Aviation Leasing
Trading conditions remained challenging during the period under review. While
aircraft sales volumes and activity levels remained high, the strong rand
continued to affect the trading results of our aviation businesses, resulting in
pressure on margins and a further R43 million (R26 million in 2003) impairment
against the value of our fleet.
Revenue increased by 4%, whilst operating profits were up 17% to R128 million
with margins improving from 9.2% to 10.4% benefiting from a R55 million profit
on the sale of aircraft. This business has continued to progress on its strategy
of focusing on value-added activities. During the period five additional
Hercules aircraft were purchased, bringing the total Hercules fleet to 11
aircraft. These assets are specifically employed in humanitarian aid, relief and
specialised operations, where the ability to leverage our value-added service
capabilities is greatest. Naturelink was acquired towards the end of the period.
Car Rental and Tourism
Car rental activities performed well as a result of improved efficiencies and
reasonable demand from the business and domestic leisure sector. However, the
strong rand continued to exert pressure on the tourism market. The tourism
interests in Imperial were affected by fewer visitors from traditional markets
like Germany and the United Kingdom.
Revenue grew by 4% and operating profits increased by 12% with operating margins
widening from 13% to 14%. A review of the estimated lives and residual values of
motor vehicles for hire contributed R20 million to the improvement in operating
profit.
Whilst pricing pressure remains significant in the car rental industry, improved
utilisation and back office efficiencies have aided our performance in this
area. Tourvest, in which the group owns a 67% stake, continued to battle the
effects of the strong rand which limited the discretionary spending of foreign
tourists and caused inbound tourist numbers to contract. Tourvest`s revenue
declined by 3%, while operating profits remained static resulting in an improved
operating margin of 9.5% (2003: 9.3%).
Distributorships
The distributorship division benefited from the strength of the South African
economy, improved critical mass, maturing dealerships, increased emphasis on
financial services, the strong rand and low interest rates. Sales volumes of
both passenger and commercial vehicles grew strongly during the period under
review. Revenue grew by 67% and operating profits increased by 117%, resulting
in an increase in operating margins to 9.3% (2003: 7.1%).
Our heavy commercial vehicle and parts distribution businesses have performed
well as economic growth increased demand, the strong rand improved affordability
and new products gained market acceptance.
Our passenger and light commercial vehicle and motorcycle import businesses
performed well as increased volumes across all the brands we represent resulted
in good revenue growth and improved critical mass. Continued growth in after-
sales activity due to vehicle park growth bodes well for the longer term outlook
and sustainability of this business. During the period we added a further three
dealerships, bringing the total number of dealers in the network to 60. The
establishment of the Tata range of passenger and light commercial vehicles into
the market has proceeded well and is expected to continue growing strongly.
Motor Vehicle Dealerships
Benefiting from similar conditions as mentioned above, the group`s dealership
division improved revenue by 15% and operating profits by a satisfactory 9%.
Operating margins declined from 2.7% to 2.6% due to a change in the sales mix,
which included a substantially larger component of new vehicle sales relative to
used vehicle and after-market sales. Pricing pressure remains an issue in this
business.
The used vehicle market remains challenging as a result of the affordability of
new vehicles which is aided by the incentives offered to consumers on these
purchases. The rollout of DaimlerChrysler`s new retail strategy is proceeding
well and we are making a substantial investment in new dealership
infrastructure. We expect positive benefits to flow from the changes.
Insurance
The group`s insurance interests, Regent Life and Regent Insurance, both
performed very well. Growth in new business volumes and excellent investment and
underwriting performances all combined to improve revenues by 26% and profit
before tax by 77% to R204 million. As a result pre-tax margins increased from
14.6% to 20.8%. Realised and unrealised gains on investments benefited from the
strong local equities market and amounted to R121 million against R41 million in
the same period last year.
Associates and joint ventures
Income from associates and joint ventures declined by 30% to R77 million from
R110 million in 2003:
- Safair Lease Finance was negatively affected by the strong rand which resulted
in a significant impairment in the value of its fleet of R65 million before tax.
Our share of the attributable charge was R23 million.
- Renault South Africa performed well, benefiting from a strong market
acceptance of its new product range, which resulted in improving critical mass,
strong volume gains and an excellent result.
- Imperial Bank experienced good trading conditions with advances growth of 32%
compared to the prior period. However, the bank`s contribution to Imperial`s
earnings declined to R31 million from R56 million. This is due to R25 million
lower earnings attributable to the bank from the collection of assets acquired
from Saambou Bank, as the acquired book is running out. It further suffered from
exceptional bad debts in its aviation book mainly driven by the strength of the
rand. On the other hand Motor Finance Corporation and the property division had
fine results.
Outlook and prospects
The outlook for Imperial remains good. The prospect of continued good economic
growth, low inflation and relatively benign interest rate movements should
continue to support solid trading patterns for most of the group`s businesses.
Whilst the strong rand has affected the performance of some of our businesses,
it benefits others, resulting in a natural hedge for the group.
We believe our businesses have the capacity to grow in their current markets.
Whilst we plan to continue looking for value-enhancing acquisition
opportunities, our primary focus remains on organic growth within Southern
Africa.
Imperial is a growth oriented group. Continued attention to returns and cash
generation should deliver solid improvements in the financial performance of our
business into the future. By leveraging a low cost of capital and a resilient
balance sheet, we continue our quest of delivering good growth and shareholder
returns. Having regard to the strong performance of the group in the second half
of the 2004 financial year, it is expected that the growth achieved for the year
to 25 June 2005, though satisfactory, will not match that achieved in the first
half.
Capital distribution number 6
Notice is hereby given that a capital distribution of 175 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, 18 March 2005. The company was
duly authorised to make capital distributions by shareholders at the annual
general meeting held on 2 November 2004. 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 capital distribution:
2005
Last day to trade cum-capital distribution Friday, 11 March
Shares commence trading ex-capital distribution Monday, 14 March
Record date Friday, 18 March
Payment date Tuesday, 22 March
Share certificates may not be dematerialised/rematerialised between Monday, 14
March 2005 and Friday, 18 March 2005, both days inclusive.
On Tuesday, 22 March 2005, the capital distribution will be electronically
transferred to the bank accounts of certificated shareholders that utilise this
facility. In respect of those who do not, cheques dated 22 March 2005 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 Tuesday, 22
March 2005.
On behalf of the board
RA Venter
Company Secretary
Johannesburg
23 February 2005
Income statement
Half year ended 25 December
Audited
Year ended
Unaudited 25 June
2004 2003 % 2004
Rm Rm change Rm
Revenue 20 898 17 363 20 35 278
Profit from operations before
depreciation and recoupments 2 398 1 938 24 4 079
Depreciation and recoupments 617 610 1 193
Operating profit 1 781 1 328 34 2 886
Foreign exchange losses (16) (4) (30)
Fair value losses on foreign
exchange derivatives (71) (17) (82)
Goodwill amortisation - (28) (63)
Profit before net financing
costs 1 694 1 279 32 2 711
Finance costs net of fair
value gains and losses (348) (318) (529)
Finance income 39 35 51
Income from associates and
joint ventures 77 110 228
Profit before exceptional
items 1 462 1 106 32 2 461
Exceptional items 21 6 (26)
Profit before taxation 1 483 1 112 33 2 435
Taxation 433 341 696
Profit after taxation 1 050 771 36 1 739
Minority interest 90 48 113
Net attributable profit
for the period 960 723 33 1 626
Basic earnings per share*
(cents)
Headline basic earnings
per share 470.3 366.3 28 840.5
Goodwill amortisation - (12.9) (29.1)
Exceptional items net of
taxation and minorities 8.0 2.7 (13.3)
Profit on sale of property,
plant and equipment 1.5 0.9 4.2
Basic earnings per share 479.8 357.0 34 802.3
Diluted earnings per share*
(cents)
Headline diluted earnings
per share 441.0 364.1 21 789.2
Diluted earnings per share 450.0 354.8 27 753.4
*Based on the weighted average
number of shares in issue.
Net asset value per share
(cents) 4 621.8 4 122.6 4 328.8
Number of shares net of
treasury stock (million)
- in issue 200.0 202.5 200.1
- weighted average 200.2 202.7 202.7
- adjusted for share options
and deferred ordinary shares 13.3 1.0 13.0
- weighted average number of
ordinary shares for diluted
earnings 213.5 203.7 215.7
Additional information
Profit before taxation
This is stated after:
Investment income -
dividends 7 8 16
Interest income - financial
services businesses 26 22 61
Net financing costs (309) (283) (478)
Finance costs (291) (327) (584)
Fair value (loss)/gain to
interest-bearing borrowings
and interest rate swap
instruments (57) 9 55
Finance cost net of fair
value gains and losses (348) (318) (529)
Finance income 39 35 51
Exceptional items 21 6 (26)
Surplus on disposal of 50.1%
of Imperial Bank Limited - - 53
Impairment of non-trading
assets (9) - (71)
Profit/(loss) on sale of
investments in subsidiaries,
associates and joint
ventures 30 6 (8)
Accounting policies
The interim financial statements have been prepared in accordance with AC 127 -
Interim Financial Reporting and comply with Statements of Generally Accepted
Accounting Practice in South Africa, effective for this financial period, and
are consistent in all material respects with those applied in the previous
annual report, except for the adoption of AC 140 - Business Combinations and
the revisions to AC 128 - Impairment of Assets and AC 129 - Intangible Assets.
Change in accounting policy
During the current year the group adopted AC 140 - Business Combinations which
results in goodwill no longer being amortised but rather reviewed for
impairment. Negative goodwill has to be written back to equity.
The effect of the change in accounting policy is that negative goodwill of R17
million has been credited to opening retained earnings at 25 June 2004. The
effect on the current year is a reduction of R31 million in amortisation of
goodwill charged to the income statement. There is no impact on headline
earnings per share as goodwill amortisation is added back in this computation.
As this is a prospective adjustment comparatives have not been restated.
Balance sheet
At 25 December
Audited
Unaudited 25 June
2004 2003 2004
Rm Rm Rm
Property, plant and equipment 2 416 2 305 2 311
Intangible assets 539 552 488
Investments in associates and joint
ventures 1 762 1 651 1 771
Other investments and loans 1 092 913 890
Deferred tax assets 228 268 252
Leasing assets 5 150 4 519 4 785
Transport fleet 2 317 1 999 2 150
Vehicles for hire 972 981 734
Inventories 4 168 3 721 3 729
Trade and other receivables 6 021 5 134 4 756
Taxation in advance 105 64 98
Cash resources 1 007 1 097 1 261
Total assets 25 777 23 204 23 225
Insurance funds 796 588 833
Interest-bearing borrowings 7 359 7 388 6 576
Retirement benefit obligations 178 194 178
Deferred tax liabilities 588 565 626
Other liabilities 7 096 5 729 5 906
Total liabilities 16 017 14 464 14 119
Net assets 9 760 8 740 9 106
FUNDED BY
Ordinary shareholders` interest 9 245 8 350 8 662
Minority interest 515 390 444
Total shareholders` equity 9 760 8 740 9 106
Supplementary information
Contingent liabilities 310 210 301
Capital commitments 369 280 328
Abridged cash flow statement
Half year ended 25 December
Audited
Year ended
Unaudited 25 June
2004 2003 % 2004
Rm Rm change Rm
Cash flows from operating
activities
- Cash generated by operations
before changes in working
capital 2 380 1 921 4 330
- Working capital movements (843) (535) (44)
Cash generated by operations 1 537 1 386 11 4 286
- Net financing costs (252) (283) (533)
- Taxation paid (231) (298) (614)
1 054 805 31 3 139
Cash flows from investing
activities
- Net acquisitions and
disposals of subsidiaries
and businesses (52) (99) (96)
- Expansion capital
expenditure (1 094) (416) (1 170)
- Net replacement capital
expenditure (468) (601) (702)
- Investments, equities and
loans to associates (11) (456) (441)
(1 625) (1 572) (2 409)
Cash flows from financing
activities
Cash flows from financing
activities (119) 588 269
Dividends paid (35) (424) (427)
Capital distribution (348) - (283)
(502) 164 (441)
Net (decrease)/increase in
cash and cash equivalents (1 073) (603) 289
Cash and cash equivalents at
beginning of period (1 275) (1 564) (1 564)
Cash and cash equivalents
at end of period (2 348) (2 167) (1 275)
Statement of changes in equity
Half year ended 25 December
Share Unaudited
capital Non-distri- Audited
and butable Retained Total Total
premium reserve earnings 2004 2003
Rm Rm Rm Rm Rm
Balance at 25 June 1 690 381 6 591 8 662 8 199
Opening retained
earnings adjustment
arising from AC 140
(2003 - AC 133) 17 17 (146)
Translation of
foreign operations
not recognised in
the income
statement (16) (16) (109)
Net attributable
profit for the
period 960 960 723
Share of non-
distributable and
distributable
reserves of
associates and
joint ventures 26 (26) -
Revaluation of
available for sale
investments to fair
value 1 1
Contingency reserve
created in terms
of the Insurance
Act 14 (14) -
Capital distribution
of 175 cents per
share (2003 -
Dividend of
140 cents per
share) 34 (382) (348) (282)
Purchase of
treasury stock (70) (70) (64)
Issue of 851 900
(2003: 768 901)
ordinary shares in
terms of the share
option scheme 39 39 29
Balance at
25 December 1 693 406 7 146 9 245 8 350
Segmental information
25 December 2004
Leasing
and fleet
INCOME STATEMENT Group Logistics management
2004 2003 2004 2003 2004 2003
Rm Rm Rm Rm Rm Rm
BUSINESS
SEGMENTATION
Revenue
- Sales of goods 10 964 8 465 313 293 351 222
- Rendering of
services 9 014 8 171 5 813 5 165 729 735
- Gross premiums
received 859 674
- Interest
income 26 22
- Dividend
income 7 8
- Other 28 23 26 23
20 898 17 363 6 152 5 481 1 080 957
Inter-segment
revenue 188 442 189 78
20 898 17 363 6 340 5 923 1 269 1 035
Operating
expenses
excluding gains
and losses on
investments 18 578 15 440 5 740 5 426 780 579
Realised and
unrealised
(gains)/losses
on investments (19) (30)
Fair value gains
investments (102) (11)
Depreciation 751 712 243 219 265 232
Recoupments (134) (102) (24) (29) (17) (22)
Impairment of
aviation leasing
aircraft 43 26
Operating profit 1 781 1 328 381 307 241 246
Foreign exchange
(losses)/gains (16) (4) (1) (2) 5 1
Fair value
(losses)/gains on
foreign exchange
derivatives (71) (17) (9) (9)
Goodwill
amortisation (28) (17) 1
Profit before net
financing costs 1 694 1 279 380 288 237 239
Net financing
costs (309) (283) (54) (51) (77) (81)
Income from
associates and
joint ventures 77 110 15 12 (1)
Profit before
exceptional
items 1 462 1 106 341 249 160 157
GEOGRAPHIC
SEGMENTATION
Revenue 20 898 17 363 6 340 5 923 1 269 1 035
- South Africa 16 911 13 813 3 178 2 926 1 074 837
- Rest of Africa 424 350 93 89 77 88
- Rest of world 3 563 3 200 3 069 2 908 118 110
Operating profit 1 781 1 328 381 307 241 246
- South Africa 1 612 1 196 277 244 207 198
- Rest of Africa 46 69 6 9 19 37
- Rest of world 123 63 98 54 15 11
Net financing
costs 309 283 54 51 77 81
- South Africa 291 262 50 45 68 70
- Rest of Africa 8 14 2 4 4 7
- Rest of world 10 7 2 2 5 4
BALANCE SHEET
BUSINESS
SEGMENTATION
Assets
Property, plant
and equipment 2 416 2 305 957 1 028 109 96
Intangible assets
(including
goodwill) 539 552 232 272 12 12
Investments,
loans and
associates 2 211 1 781 2 76 (1)
Leasing assets 5 150 4 519 2 693 2 205
Transport fleet 2 317 1 999 2 381 2 049
Vehicles for
hire 972 981
Inventories 4 168 3 721 167 160 355 287
Trade and other
receivables 6 021 5 134 3 008 2 659 393 296
Cash in financial
services
businesses 404 328
Operating assets 24 198 21 320 6 747 6 244 3 562 2 891
Deferred tax
assets 228 268
Loans to
associates
and other
investments 643 783
Taxation in
advance 105 64
Cash and cash
equivalents 603 769
Total assets per
balance sheet 25 777 23 204
LIABILITIES
Insurance funds 796 588
Retirement
benefit
obligations 178 194 178 194
Accounts payable
and provisions 6 453 5 298 2 576 2 237 480 415
Non-interest-
bearing
liabilities 7 427 6 080 2 754 2 431 480 415
Interest-bearing
borrowings 7 359 7 388
Deferred tax
liabilities 588 565
Current tax
liabilities 643 431
Total liabilities
per balance
sheet 16 017 14 464
GEOGRAPHIC
SEGMENTATION
OPERATING ASSETS 24 198 21 320 6 747 6 244 3 562 2 891
- South Africa 20 470 17 950 4 866 4 262 2 821 2 212
- Rest of Africa 674 478 135 103 277 218
- Rest of world 3 054 2 892 1 746 1 879 464 461
NON-INTEREST-
BEARING
LIABILITIES 7 427 6 080 2 754 2 431 480 415
- South Africa 6 099 4 799 1 788 1 468 375 320
- Rest of Africa 308 201 43 31 50 44
- Rest of world 1 020 1 080 923 932 55 51
INTEREST-BEARING
BORROWINGS 7 359 7 388 1 564 1 815 2 058 1 573
- South Africa 6 573 6 647 1 335 1 562 1 731 1 287
- Rest of Africa 348 308 74 72 207 132
- Rest of world 438 433 155 181 120 154
GROSS CAPITAL
EXPENDITURE 2 714 1 952 460 426 975 489
- South Africa 2 153 1 755 369 332 555 401
- Rest of Africa 153 65 29 13 116 45
- Rest of world 408 132 62 81 304 43
Gross capital
expenditure 2 714 1 952 460 426 975 489
Less: Proceeds
on disposal (1 152) (884) (84) (115) (465) (213)
Net capital
expenditure 1 562 1 068 376 311 510 276
Segmental information
25 December 2004
Aviation Car rental
INCOME STATEMENT leasing and tourism Distributorships
2004 2003 2004 2003 2004 2003
Rm Rm Rm Rm Rm Rm
BUSINESS
SEGMENTATION
Revenue
- Sales of goods 330 394 692 604 3 912 2 259
- Rendering of
services 903 796 1 027 1 033 243 195
- Gross premiums
received
- Interest
income
- Dividend
income
- Other
1 233 1 190 1 719 1 637 4 155 2 454
Inter-segment
revenue 82 102 702 460
1 233 1 190 1 801 1 739 4 857 2 914
Operating
expenses
excluding gains
and losses on
investments 1 028 970 1 470 1 421 4 379 2 682
Realised and
unrealised
(gains)/losses
on investments
Fair value gains
investments
Depreciation 89 82 116 145 28 25
Recoupments (55) 3 (38) (53) (2) (1)
Impairment of
aviation leasing
aircraft 43 26
Operating profit 128 109 253 226 452 208
Foreign exchange
(losses)/gains (2) (1) (3) (12) 1
Fair value
(losses)/gains on
foreign exchange
derivatives (1) (63) (7)
Goodwill
amortisation (12)
Profit before net
financing costs 126 108 252 211 377 202
Net financing
costs (71) (63) (13) (16) (19) (53)
Income from
associates and
joint ventures 11 30 1 19 11
Profit before
exceptional
items 66 75 239 196 377 160
GEOGRAPHIC
SEGMENTATION
Revenue 1 233 1 190 1 801 1 739 4 857 2 914
- South Africa 906 1 008 1 648 1 678 4 794 2 876
- Rest of Africa 103 61 63 38
- Rest of world 327 182 50
Operating profit 128 109 253 226 452 208
- South Africa 118 111 246 217 453 213
- Rest of Africa 7 9 (1) (5)
- Rest of world 10 (2)
Net financing
costs 71 63 13 16 19 53
- South Africa 68 62 13 15 18 51
- Rest of Africa 1 1 1 2
- Rest of world 3 1 (1)
BALANCE SHEET
BUSINESS
SEGMENTATION
Assets
Property, plant
and equipment 110 121 185 187 515 396
Intangible assets
(including
goodwill) 20 13 234 240
Investments,
loans and
associates 494 436 2 2 254 208
Leasing assets 2 248 2 141 216 180
Transport fleet
Vehicles for
hire 980 990
Inventories 555 676 342 342 1 446 1 173
Trade and other
receivables 531 413 366 384 1 194 713
Cash in financial
services
businesses
Operating assets 3 958 3 800 2 109 2 145 3 625 2 670
Deferred tax
assets
Loans to
associates
and other
investments
Taxation in
advance
Cash and cash
equivalents
Total assets per
balance sheet
LIABILITIES
Insurance funds
Retirement
benefit
obligations
Accounts payable
and provisions 301 513 700 588 1 669 808
Non-interest-
bearing
liabilities 301 513 700 588 1 669 808
Interest-bearing
borrowings
Deferred tax
liabilities
Current tax
liabilities
Total liabilities
per balance
sheet
GEOGRAPHIC
SEGMENTATION
OPERATING ASSETS 3 958 3 800 2 109 2 145 3 625 2 670
- South Africa 3 596 3 550 2 055 2 114 3 586 2 641
- Rest of Africa 34 31 39 29
- Rest of world 362 250 20
NON-INTEREST-
BEARING
LIABILITIES
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