INTERIM RESULTS PRESENTATION December 2016

Transcription

1 WELCOME

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4 INTERIM RESULTS PRESENTATION December 2016

5 Financial Highlights EBITDA Mix H Fiscal Year H H H % 15.2% 0.4% R'millions (unless otherwise stated) Revenue Gross Profit Gross Profit (%) 17,8 12,9 14,4 EBITDA Operating Income Operating Income (%) 5,7 5,3 5,2 Net Profit after Tax Earnings per Share (cents) 106,5 94,4 78,2 Headline Earnings per Share (cents) 106,1 94,1 80,4 Core Earnings per Share (cents) 110,2 94,1 80,4 Weighted Average Shares Outstanding (m) Inventories Total Stockholders Equity Debt to Equity Ratio (%) 18,7 26,7 74,7 Return on Net Equity (%) 16,9 17,8 18,8 51.4% ICT Distribution Services & Solutions Financial Services Group Central Services EBITDA Mix H % 20.3% 3.1% 76.7% 5 HIGHLIGHTS ICT Distribution Services & Solutions Financial Services Group Central Services

6 AGENDA Highlights Group Review Operational Review Strategy and the way forward

7 At a Glance REVENUE UP 47% to R6.3 billion CORE EPS UP 17% to cents CASH GENERATED UP 233% to R592.3 million SHORT TERM DEBT 0 7 HIGHLIGHTS

8 Activities Datacentrix BUY OUT of minorities concluded in Feb 2017 Securitisation BEDDED DOWN and R50m further funding B-BBEE transaction concluded - now BLACK OWNED and a Level 2 contributor IRAS Sustainability survey 1 st in the ICT sector and 16 th overall 8 HIGHLIGHTS

9 Equity Transactions SHARE BUY BACKS Datacentrix 6,461,472 R5.37 R35m Pinnacle R15.71 R71m DIVIDENDS Re-introduced dividends R33m 9 HIGHLIGHTS

10 GROUP REVIEW

11 Salient features of the income statement H H % Revenue ,5 EBITDA ,5 Depreciation and amortisation (44 996) (15 319) 193,7 Centrafin Net Finance Costs (54 205) (48 187) 12,5 FEC s Profit before taxation ,9 Taxation (96 031) (51 155) 87,7 Attributable Income ,4 RETURN TO SHAREHOLDERS Basic earnings per share (cents) 106,5 94,4 12,8 Headline earnings per share (cents) 106,1 94,1 12,7 Core earnings per share (cents) 110,2 94,1 17,2 11 GROUP REVIEW

12 Group Financial Ratios Overview Salient Features of the Income Statement H % H % Gross profit 17,8 12,9 Operating expenses (11,3) (7,2) EBITDA 6,5 5,6 Operating profit before Interest and taxation 5,7 5,3 Return on Equity 16,9 17,8 12 GROUP REVIEW

13 Group Working Capital H H Inventories on hand Inventories in transit Total Inventories Trade and other receivables Inventories on hand Dec-16 Dec-15 Distribution Datacentrix Solareff Trade and other payables WORKING CAPITAL GROUP REVIEW

14 Cash Equivalents & Borrowings Cash and Borrowings H R'000 HY R'000 Cash and cash equivalents Other long term liabilities Interest bearing liabilities Rand Merchant Bank Bonds Instalment Sale Agreements Derivative Financial Liability Short Term Loan (Investec) Bank Overdrafts Total Borrowing ( ) ( ) Debt to Equity % 18,7 26,7 NET CASH / (BORROWING) ( ) 14 GROUP REVIEW

15 OPERATIONAL REVIEW

16 DISTRIBUTION

17 Distribution Distribution showing healthy revenue growth of 11% Ongoing Expense Control costs down from 7,2% to 6.9% Improved Stock Management Continue to expand Product offering in changing market Remain highly Competitive & Efficient Continued focus on Net Working Capital Latest Channel Awards 17 OPERATIONAL REVIEW

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19 Recent Awards As voted by Resellers 1. SME Component Distributor Award Pinnacle 2. SME End-user Computing Award Pinnacle 3. SME Peripherals and Accessories Award Tarsus 4. SME Server, Storage and Networking Award Axiz 5. SME Distributor of the Year Award Pinnacle 6. Enterprise End-user Computing Award Axiz 7. Enterprise Printers, Peripherals and Accessories Award Axiz 8. Enterprise Server, Storage and Networking Award Axiz 9. Enterprise Software Distributor Award Axiz 10. Enterprise Distributor of the Year Award Axiz 20 OPERATIONAL REVIEW

20 Recent Awards Enterprise Distributor of the Year Award 2016 SME/Consumer Distributor of the Year Award 2016 Axiz Pinnacle Tarsus Drive Control First Distribution Mustek 6% 8% 8% 6% 5% 32% Axiz Pinnacle Tarsus Drive Control Syntech 14% 3% 4% 11% 17% 18% Westcon-Comstor Rectron 17% 18% Mustek Corex 7% 9% 17% Esquire Rectron 21 OPERATIONAL REVIEW

21 Recent Awards Distributor of the year awards Hewlett Packard Enterprise Microsoft VMWare McAfee Citrix Veeam HP Inc. 19 OPERATIONAL REVIEW

22 Distribution Income Statement H R'000 H R'000 % Revenue Gross Profit GP % of Revenue 11,4 11,6 Operating Expenses Cost % of Revenue 6,9 7,2 EBITDA EBITDA % of Revenue 4,4 4,4 22 OPERATIONAL REVIEW

23 Distribution Working Capital H R'000 H R'000 Net working capital (days) Days inventory (excluding in transit) Days sales Days purchases Return on equity 20,8% 20,8% 23 OPERATIONAL REVIEW

24 Distribution Revenue Contribution H H % OF TOTAL REVENUE H % 30% 19% 19% 10% 10% 41% 41% 26% 16% 9% 49% Enterprise & Infrastructure Software Client Computing Components & Accessories 24 OPERATIONAL REVIEW

25 STRUCTURED FINANCE SOLUTIONS

26 Structured Finance Solutions Revenue for the year increased by 20% Profit before tax increased by 26% Finance lease book increased to R660 million Securitisation finalised flexible funding facility Credit Risk Management remains Market Leading 26 OPERATIONAL REVIEW

27 Structured Finance Solutions Income statement H R'000 H R'000 % Revenue Gross Profit GP % of Revenue 59,8 60,4 Operating Expenses Cost % of Revenue 20,5 21,8 Profit Before Tax PBT % of Revenue 40,5 38,6 27 OPERATIONAL REVIEW

28 Structured Finance Solutions Performance of Financial Lease Book H R'000 H R'000 Value of the Finance Book Portfolio at Risk - 1 Day Post Post % 1,33 1,03 Period-end Period-end % 2,13 1,62 Return on equity % 30,5 31,9 Gearing % 74,5 76,1 28 OPERATIONAL REVIEW

29 Structured Finance Solutions PAR 1 Day PAR1day % 1.61% 1.33% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan PAR1day % Snapshot PAR1day % Snapshot Post Recovery 29 OPERATIONAL REVIEW

30 SERVICES AND SOLUTIONS

31 Services and Solutions Bedded down recent acquisitions Continued focus on growth Datacentrix awarded significant contracts Wits Department of Justice Coca-Cola bottling company Barloworld 31 OPERATIONAL REVIEW

32 Services and Solutions Solareff significant contracts Mall of Africa Woolworths Graham Beck 32 OPERATIONAL REVIEW

33 Solareff Installation Mall of Africa

34 Services and Solutions Income Statement H R'000 Revenue Gross Profit GP % of Revenue 28,6 Selling And Distribution Payroll Expense Administration Expenses Operating Expenses Cost % of Revenue 21,0 EBITDA EBITDA % of Revenue 7,6 34 OPERATIONAL REVIEW

35 STRATEGY AND THE WAY FORWARD

36 Acquisitions Notable Announcements Seeking companies with barriers to entry IP based businesses Target companies with an EBITDA of R60m plus Selective smaller acquisitions (strategic or complimentary) to existing divisions to accelerate organic growth Primary focus on services and solutions businesses Focus mainly on Local but consider International where it makes sense 36 STRATEGY

37 CEO s priorities and objectives Notable Announcements Implement new ICT charter Continue to balance the group returns Strengthen current businesses and gain market share Maintain and grow our first tier brand and services offering Increase returns to shareholders Drive further working capital improvements Build reputation as: a well-diversified ICT group Execute acquisition strategy 37 STRATEGY

38 THANK YOU Any reference to future performance included in this presentation has not been reviewed nor reported on by Pinnacle s auditors.