REVIEWED FINAL RESULTS FOR THE YEAR ENDED 30 JUNE 2015

Transcription

1 REVIEWED FINAL RESULTS FOR THE YEAR ENDED 30 JUNE 2015

2 REVIEWED FINAL RESULTS for the year ended June 2015 CONTENTS Page Highlights 1 Introduction 1 Financial performance 2 Divisional review 3 Supply Chain 3 Fleet Solutions 3 Dealerships 4 Services 4 Subsequent events 4 Prospects 5 Basis of preparation and accounting policies 5 Condensed Consolidated Statement of Comprehensive Income 6 Condensed Consolidated Statement of Financial Position 7 Condensed Consolidated Statement of Cash Flows 8 Condensed Consolidated Statement of Changes in Equity 9 Operating segments 10 Business combinations 12 Salient features 14 Corporate information IBC SUPER GROUP LIMITED (Incorporated in the Republic of South Africa) Registration number 1943/016107/06 Share code SPG ISIN ZAE ( Super Group or the Group or the company )

3 HIGHLIGHTS For the year ended 30 June % REVENUE R19,8 BILLION +12% OPERATING PROFIT R1,5 BILLION +9% HEPS 271 CENTS +11% CORE HEPS 289 CENTS +6% OPERATING CASH FLOW R2,1 BILLION +17% NAV PER SHARE CENTS INTRODUCTION The Group reported a good set of results for the year ended 30 June 2015, despite a challenging economic and trading environment. Super Group is a leading transport logistics and mobility group, headquartered in South Africa. The Group includes supply chain, dealerships and fleet solutions businesses focused on offering a comprehensive range of services, utilising world-class skills and technology. The businesses that comprise Super Group are Supply Chain South Africa, African Logistics, FleetAfrica, a 54% interest in SG Fleet Group Limited (a listed Australian fleet management business), Dealerships South Africa (SA), Dealerships United Kingdom (UK), which includes the 100% interest in Allen Ford (UK), a franchised Ford and Kia motor dealer group acquired on 1 December 2014, and Services. The logistics and transport industry in South Africa has seen a marked increase in new players, increasing the competitive landscape and eroding margins. Although the outsourcing of logistics continues to gain momentum, it remains challenging to win meaningful contracts with competitor pressure on prices impacting across all sectors. Logistics into Africa continued to be exceptionally tough with highly competitive cross-border rates and other factors impacting the results negatively. The Australian operating environment was muted and business sentiment declined over the reporting period. Despite these trends, the fleet management market continued to grow and SG Fleet continues to enjoy a strong tender pipeline. The fleet management market remains competitive, however, SG Fleet is well positioned in the Australian market and continues to gain traction in the UK market. The UK market showed positive signs of recovery with Dealerships UK benefitting from the growth experienced by the dealership market. During the year under review, Super Group concluded various transactions that are explained in more detail in the Divisional Review section of this document. SUPER GROUP Reviewed final results for the year ended 30 June

4 FINANCIAL PERFORMANCE Revenue increased by 38.6% to R million (June 2014: R million). The growth in revenue was mainly attributable to the solid performances by Supply Chain South Africa, both Fleet Solutions businesses, Dealerships SA and the inclusion of Allen Ford (UK) for the seven months to June Although operating profit increased by 11.6% to R1 501 million (June 2014: R1 345 million), operating profit margin declined to 7.6% (June 2014: 9.4%) as a result of the Allen Ford (UK) acquisition and an extremely disappointing performance by African Logistics. The increase in net finance costs by 35.7% to R139 million (June 2014: R102 million) relates to an increased net borrowings position as a result of the Phola Coaches, Allen Ford (UK) and other acquisitions. Profit before taxation increased by 9.7% to R1 362 million (June 2014: R1 242 million), directly as a result of the improved operational profitability of the Group. Earnings per share (EPS) and headline earnings per share (HEPS) for the year under review increased by 8.5% to 270,4 cents (June 2014: 249,2 cents) and 9.0% to 271,1 cents (June 2014: 248,7 cents), respectively. Core HEPS increased by 11.2% to 289,1 cents (June 2014: 260,0 cents) on the basis that the Broad-Based Black Economic Empowerment (B-BBEE) scheme, amortisation of intangibles and acquisition costs amounting to 18,0 cents per share are excluded from HEPS. The increase in total assets of 25.6% to R million (30 June 2014: R million) was mainly as a result of newly acquired assets together with the completion of a new dealership at Super Park. The Group s Return on Net Operating Assets (RNOA), after tax, was 16.7% (June 2014: 18.6%) for the year under review. However, normalised RNOA, after tax and excluding the effects of acquisitions and disposals during the period, is 18.1%. Super Group s net debt position at 30 June 2015 increased to R995 million as a result of the various acquisitions concluded in South Africa and the Allen Ford (UK) acquisition. The Group s total gearing as at 30 June 2015 was 16.8% (30 June 2014: 1.7%). The net asset value per share increased by 16.9% for the year to 1 680,5 cents at 30 June 2015 (30 June 2014: 1 437,1 cents). The Group s Statement of Financial Position remains healthy. Operating cash flow increased by 5.9% for the year to R2 123 million (June 2014: R2 005 million) with a working capital outflow of R102 million (June 2014: R90 million). As a result, cash generated from operations, after working capital, increased by 5.5% to R2 021 million (June 2014: R1 915 million). During the year under review, the company repurchased shares, totalling 0.8% of the issued share capital, at an average share price of R31,26. The total consideration relating to these repurchases was R79 million. REVENUE to June OPERATING PROFIT to June PROFIT BEFORE TAXATION to June SUPPLY CHAIN 42 % SUPPLY CHAIN 37 % SUPPLY CHAIN 35 % FLEET SOLUTIONS 11 % FLEET SOLUTIONS 46 % FLEET SOLUTIONS 50 % DEALERSHIPS 47 % DEALERSHIPS 17 % DEALERSHIPS 15 % R million Contribution indicated R million Contribution indicated R million as a percentage of Group as a percentage of Group excl. services excl. services Contribution indicated as a percentage of Group excl. services 2

5 DIVISIONAL REVIEW SUPPLY CHAIN 30 June 30 June Change % Revenue South Africa African Logistics (6.5) Operating profit South Africa African Logistics (70.7) Operating margin (%) South Africa African Logistics Profit before taxation South Africa African Logistics (73.0) Net operating assets South Africa African Logistics The majority of Supply Chain South Africa s businesses delivered a strong performance in a challenging trading environment and sluggish economic climate. SG Consumer reported good financial results for the year under review with solid volume growth on the back of new contracts. Digistics performed well, adding Corner Bakery and Pizza Hut as new clients. Safika Oosthuizens experienced unsettled trading conditions in the second half of the year given the Eskom situation, but delivered a strong financial result for the full year. SG Convenience disappointed on the back of increased infrastructural costs. SG Consumer, SG Mobility, Freight, Super Rent and Phola Coaches performed in line with expectations. During the first half of the year, SG Logistics was closed resulting in an impairment charge of R8,4 million. African Logistics reported disappointing results with revenue, operating profit and profit before taxation declining materially. The reduction in revenue was as a result of an effective 11.9% reduction in transport rates. Operating profit margin was also significantly below the target level of 12% and was eroded by sporadic mining labour unrest in the Democratic Republic of Congo and worsening border efficiencies. The cross border operations are of concern and the results reflect a large increase in South African-based operators expanding into Africa, transport rate reductions and South-bound volume decline due to mining closures or reduced output levels. FLEET SOLUTIONS 30 June 30 June Change % Revenue FleetAfrica SG Fleet Operating profit FleetAfrica (5.5) SG Fleet Operating margin (%) FleetAfrica SG Fleet Profit before taxation FleetAfrica (12.7) SG Fleet Net operating assets FleetAfrica SG Fleet (10.0) FleetAfrica performed well and met budget expectations. Revenue increased by 36.5% with operating profit margin returning to a more normalised level of 22.1%. The lower operating margin is due to the business securing long-term contracts with lower margins. FleetAfrica has managed to secure a number of meaningful contracts and delivered 77% of the vehicles on the Transnet contract. About 80% of FleetAfrica s contracts are public sector work-related. The business is also pursuing certain opportunities in Botswana. Its B-BBEE Level 2 rating has been extended until April SG Fleet reported a solid set of results and the momentum coming out of the 2014 financial year has been maintained, allowing the business to exceed SUPER GROUP Reviewed final results for the year ended 30 June

6 its profit forecast disclosed in its listing prospectus. Further customer wins and deeper penetration within existing customers, has resulted in SG Fleet having a fleet size of over vehicles. Good progress was made in both the corporate and government segments with new wins from a Federal Government department and the Australian arm of a major international professional services firm. The novated lease market showed good growth and the salary-packaged lease product gained good traction in the UK. The exchange rate applicable to the Australian Dollar against the Rand positively impacted the final results of Super Group to an amount of R0,5 million (June 2014: R19,5 million). DEALERSHIPS 30 June 30 June Change % Revenue Dealerships SA Dealerships UK Operating profit Dealerships SA Dealerships UK Operating margin (%) Dealerships SA Dealerships UK 2.3 Profit before taxation Dealerships SA Dealerships UK Net operating assets Dealerships SA (23.0) Dealerships UK Dealerships SA reported an exceptional set of results despite challenging market conditions. The NAAMSA dealer market reported a 0.7% decline in new vehicle sales for the year ended 30 June 2015 (June 2014: 2.1% decline), while Dealerships new vehicle sales increased by 5.7% for the same period. This was attributable to the inclusion of two newly acquired dealerships and opening three new dealerships during the year. The majority of businesses within Dealerships SA performed really well. Used vehicle performance continued to grow (25.4% up on the prior year) as a direct result of significant new vehicle price increases and additional focus within the division. The above, together with strict overhead control and working capital management, resulted in Dealerships increasing its operating margin to 2.9% (June 2014: 2.7%). Dealerships UK holds the 100% interest in Allen Ford (UK), a franchised motor dealership group operating 13 franchised Ford motor dealerships and two franchised Kia dealerships in the UK, acquired effective 1 December The seven-month results reported by Allen Ford were ahead of expectations and are reflected after the deduction of once-off acquisition costs of R16,8 million. SERVICES The Services segment includes the Corporate, Insurance and Mauritius operations. SUBSEQUENT EVENTS Super Group announced the acquisition of a 75% equity interest in IN time, a German-based company providing time-critical delivery services across Europe. Super Group is acquiring the 75% interest from Equistone Partners. The enterprise value for IN time, via Telo Zwei Vermögensverwaltung GmbH (the holding company), before deducting the Euro debt of 58,0 million, is 153,5 million (approximately R2,1 billion). The settlement arrangement will be in the form of Super Group s 75% equity interest of 48,9 million (R685 million) and the Super Group Shareholder s Loan of 30,3 million (R424 million). IN time management will retain a 25% equity interest valued at 16,3 million (R228 million). The valuation of IN time was based on a historic PE multiple of 8.4 times and the effective return on equity, including the shareholders loans, is 11.9%. Super Group s investment will be funded via existing cash on hand within the Group and a proposed fully underwritten renounceable Rights Offer of approximately R900 million. The conditions precedent include approval by the South African Reserve Bank, received on 14 August 2015, and the successful completion of the proposed Rights Offer. The IN time presentation is available on Super Group s website 4

7 PROSPECTS The South African economy is expected to remain under severe pressure over the short to medium term. The operational challenges the Group is expecting are an increase in the competitive landscape resulting in pricing compressions across all sectors, the South African currency weakening against all major currencies, interest rate hikes, inflationary pressures including the high costs of running facilities during power load-shedding and depressed consumer spending as a result of higher unemployment rates. Supply Chain South Africa s stated strategy of pursuing selected opportunities in higher growth niche markets, remains unchanged. The Group will further focus on increasing customer penetration and expanding its clientbase in the consumer and industrial products environment. African Logistics results are unlikely to reverse significantly over the medium term, but the Group is of the view that good opportunities remain in this market. FleetAfrica continues to explore and tender on new fleet management contract opportunities and is pursuing opportunities outside of South Africa. SG Fleet s focus will remain on increased penetration of existing customers, converting fleet management customers to full leasing services, bringing new entrants to the outsourced fleet management model, introducing innovative products to major customers and differentiated product and service propositions. The Dealerships SA business is anticipating difficult trading conditions to continue as consumers remain under pressure. The weak Rand and potential interest rate hikes will place pressure on operations. Dealerships SA remain confident that its dealerships are well positioned to continue its good trading performance. Dealerships UK is expecting good growth in the new and second hand vehicle market in the UK. On 30 June 2015 Super Group announced that Mr Neill Davies, a director since November 2009, retired from the Board of directors. The Board would like to express its appreciation for the valuable input and contribution Neill contributed during his tenure and wishes him a long and fulfilling retirement. Super Group is also pleased to announce the appointment of Ms Mariam Cassim to the Board as an Independent Non-Executive Director with effect from 1 July Super Group s position as an innovative, integrated mobility solutions company is strong and the Group remains committed to, organically and through strategic acquisitions, achieve a real increase in earnings for the medium to longer term and unlock shareholder value. A decision was taken not to declare a dividend for the year ended 30 June The Board remains of the opinion that Super Group should rather reinvest cash generated in acquisitions or to repurchase shares. The reviewed Condensed Consolidated Financial Statements for the year ended 30 June 2015 will be available on the Group s website after 17:00 on Monday, 24 August 2015 and the presentation to the investor community can be viewed on the Group s website from Tuesday, 25 August 2015 after 12:00. Copies of the full announcement are available on request from Nigel Redford, Company Secretary, nigel.redford@supergrp.com. The Group s website is On behalf of the Board P Vallet Chairman of the company 24 August 2015 Sandton P Mountford Chief Executive Officer The auditor s report does not necessarily report on all of the information contained in this announcement/financial results. Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor s engagement they should obtain a copy of the auditor s report together with the accompanying financial information from the company's registered office. BASIS OF PREPARATION AND ACCOUNTING POLICIES The Condensed Consolidated Financial Statements for the year ended 30 June 2015 are prepared in accordance with the requirements of the JSE Limited Listings Requirements for preliminary reports and the requirements of the Companies Act of South Africa. The Listings Requirements require preliminary reports to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34: Interim Financial Reporting. The accounting policies applied in the preparation of the Condensed Consolidated Financial Statements for the year ended 30 June 2015, are in terms of IFRS and are consistent with those applied in the previous Consolidated Annual Financial Statements, except for the standards and amendments to standards that are relevant to and became effective for the first time in Super Group s financial year commencing 1 July 2014: Offsetting Financial Assets and Financial Liabilities (Amendments to IAS 32), Recoverable Amount Disclosures for Non-Financial Assets (Amendments to IAS 36), Classification and measurement of contingent consideration (Amendments to IFRS 3), Disclosure on the aggregation of operating segments (Amendments IFRS 8), Measurement of short-term receivables and payables (Amendments to IFRS 13), Restatement of accumulated depreciation (amortisation) on revaluation (Amendments to IAS 16 and IAS 38) and Inter-relationship of IFRS 3 and IAS 40 (Amendments to IAS 40). The impact of adopting the above standards and amendments to standards had no material effect on the Condensed Consolidated Financial Statements. The Condensed Consolidated Financial Statements have been reviewed by the Group s auditors, KPMG Inc. and their unqualified report is available for inspection at the company s registered office. The Condensed Consolidated Financial Statements are presented in Rand, which is the company s functional currency and the Group s presentation currency. These results have been compiled under the supervision of the Chief Financial Officer, Colin Brown, CA(SA), BCompt (Hons), MBL. SUPER GROUP Reviewed final results for the year ended 30 June

8 CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 30 June 30 June Reviewed Audited Revenue Trading profit before depreciation and amortisation Depreciation and amortisation ( ) ( ) Trading profit Capital items (6 045) Operating profit Net finance charges ( ) ( ) Profit before taxation Income tax expense ( ) ( ) Profit for the year Profit for the year attributable to: Non-controlling interests Equity holders of Super Group Other comprehensive income Effect of foreign exchange # (17 385) Hedge accounting* (67) Revaluation of land and buildings* Taxation effect of revaluation of land and buildings* (4 338) (5 838) Other comprehensive income for the year (net of tax) Total comprehensive income for the year (net of tax) Total comprehensive income for the year attributable to: Non-controlling interests Equity holders of Super Group RECONCILIATION OF HEADLINE EARNINGS Profit attributable to equity holders of Super Group Capital items after tax (1 495) Headline earnings for the year RECONCILIATION OF CORE HEADLINE EARNINGS Headline earnings for the year Acquisition costs after tax B-BBEE costs after tax Amortisation of intangible assets arising on business combinations after tax Core headline earnings for the year Earnings per share (cents) Basic Diluted Headline earnings per share (cents) Basic Diluted Core headline earnings per share (cents) Basic 289,1 260,0 Diluted 282,1 252,4 # Item of other comprehensive income which will be reclassified to profit or loss in the event of deconsolidation of relevent subsidiary. *Items of other comprehensive income which will not be reclassified to profit or loss. 6

9 CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION 30 June June 2014 Reviewed Audited ASSETS Non-current assets Property, plant and equipment Investment property Full maintenance lease assets Intangible assets Goodwill Investments and other non-current assets Deferred tax assets Current assets Assets held-for-sale Inventories Trade receivables Sundry receivables Cash and cash equivalents Total assets EQUITY AND LIABILITIES Capital and reserves Capital and reserves attributable to equity holders of Super Group Non-controlling interests Total equity Liabilities Non-current liabilities Fund reserves Non-controlling interest put option and other liabilities Full maintenance lease liabilities Interest-bearing borrowings Provisions Deferred tax liabilities Current liabilities Full maintenance lease liabilities Interest-bearing borrowings Non-controlling interest put option liability Trade and other payables Income tax payable Provisions Total equity and liabilities SUPER GROUP Reviewed final results for the year ended 30 June

10 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS 30 June 30 June Audited Reviewed Restated 1 Cash flows from operating activities Operating cash flow Working capital outflow ( ) (90 175) Cash generated from operations Finance costs paid ( ) ( ) Investment income and interest received Income tax paid ( ) ( ) Dividend paid to non-controlling interest ( ) ( ) Net cash generated from operating activities Cash flows from investing activities Net additions to plant and equipment ( ) ( ) Net additions to land, buildings and leasehold improvements ( ) ( ) Net additions to full maintenance lease assets ( ) (68 789) Net additions to intangible assets (35 328) (21 535) Proceeds on disposal of assets held-for-sale Net acquisition of businesses (net of cash acquired) ( ) (18 147) Dividends received from equity-accounted investee Other investing activities (85 097) Net cash outflow from investing activities ( ) ( ) Cash flows from financing activities Net share repurchases (75 937) (64 338) Net additional investment in existing subsidiaries 1 (78 940) ( ) Net interest-bearing borrowings raised Net full maintenance lease borrowings raised Net cash inflow/(outflow) from financing activities ( ) Net increase in cash and cash equivalents Net cash and cash equivalents at beginning of the year Effect of foreign exchange on cash and cash equivalents (38 831) Cash and cash equivalents at end of the year Additional investment in existing subsidiaries was previously classified as cash flow from investing activities. This has been reclassified to financing activities as mandated by IAS 7.42A. 8

11 CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Share Share Share Other Retained buyback Non-controlling Total capital premium reserves earnings reserve Total interest (NCI) equity Balance at 30 June 2013 Audited ( ) Changes in equity for the 2014 year Other comprehensive income Translation adjustment Revaluation of land and buildings Taxation effect of revaluation of land and buildings ( 5 838) ( 5 838) ( 5 838) Profit for the year Total comprehensive income for the year Realisation of revaluation reserve through depreciation (1 136) Realisation of revaluation reserve through reclassification of revalued properties (13 031) Share-based payment reserve movement South African share options exercised ( ) ( ) (180) ( ) South African B-BBEE good leaver options exercised 1 (1 936) (1 936) (9) (1 945) Share buybacks Deferred tax recorded directly in equity on movement in options NCI put options movement Dividends paid to NCI ( ) ( ) Transactions with equity partners (96 576) (96 576) SG Fleet share options exercised ( ) ( ) ( ) ( ) SG Fleet initial public offering (IPO) transaction costs (28 152) (28 152) (28 039) (56 191) NCI recognised in respect of subsidiaries acquired Balance at 30 June 2014 Audited ( ) Changes in equity for the 2015 year Other comprehensive income (37 917) Translation adjustment (37 886) (17 385) Effective portion of hedge (36) (36) (31) (67) Revaluation of land and buildings Taxation effect of revaluation of land and buildings (4 338) (4 338) (4 338) Profit for the year Total comprehensive income for the year Realisation of revaluation reserve through depreciation (116) 116 Realisation of revaluation reserve through reclassification of revalued properties (4 403) Share-based payment reserve movement South African share options exercised ( ) ( ) (228) ( ) South African B-BBEE good leaver options exercised 1 (4 966) (4 966) (4 966) Share buybacks Deferred tax recorded directly in equity on movement in options NCI put options movement Dividends paid to NCI ( ) ( ) Additional investment in existing subsidiaries (49 665) (49 665) (29 275) (78 940) NCI recognised in respect of subsidiaries acquired NCI derecognised in respect of subsidiary disposed (91 766) (91 766) Balance at 30 June 2015 Reviewed ( ) A good leaver is an employee who participated in the Broad-Based Black Economic Empowerment Scheme whose employment was terminated due to their death, retrenchment, retirement or sale of the subsidiary or business which employed the participant. SUPER GROUP Reviewed final results for the year ended 30 June

12 OPERATING SEGMENTS 30 June 2015 Reviewed Super Group Supply Chain South Africa African Logistics 30 June 2014 Audited 30 June 2015 Reviewed 30 June 2014 Audited 30 June 2015 Reviewed 30 June 2014 Audited Revenue South Africa Australia United Kingdom Africa and other Depreciation and amortisation ( ) ( ) ( ) ( ) (51 461) (37 238) Net operating expenditure excluding capital items ( ) ( ) ( ) ( ) ( ) ( ) Trading profit Capital items (6 045) (5 181) (525) Operating profit Net finance charges ( ) ( ) (72 130) (68 171) (2 834) (3 670) Profit before tax Super Group Supply Chain South Africa African Logistics Reviewed Audited Reviewed Audited Reviewed Audited ASSETS Non-current assets Property, plant and equipment Investment property Full maintenance lease assets Intangible assets Goodwill Investments and other non-current assets Current assets Asset held for sale Inventories Trade receivables Sundry receivables Intercompany trade receivables SEGMENT ASSETS South Africa Australia United Kingdom Africa and other LIABILITIES Non-current liabilities Long-term borrowings Non-controlling interest put options and other liabilities Fund reserves Long-term provisions Current liabilities Short-term borrowings Non-controlling interest put option Trade and other payables and provisions Intercompany trade payables SEGMENT LIABILITIES South Africa Australia United Kingdom Africa and other Net capex South Africa Australia United Kingdom Africa and other Net operating assets

13 30 June 2015 Reviewed FleetAfrica SG Fleet Dealerships SA Dealerships UK 30 June 2014 Audited 30 June 2015 Reviewed 30 June 2014 Audited 30 June 2015 Reviewed 30 June 2014 Audited 30 June 2015 Reviewed 30 June 2014 Audited Services and intercompany eliminations 30 June 2015 Reviewed 30 June 2014 Audited ( ) (90 446) (67 728) (64 851) (15 243) (13 971) (10 007) (12 511) (11 565) ( ) ( ) ( ) ( ) ( ) ( ) ( ) (9 043) (17 278) (22 733) (34 966) (27 244) (22 139) FleetAfrica SG Fleet Dealerships SA Dealerships UK Services and intercompany eliminations Reviewed Audited Reviewed Audited Reviewed Audited Reviewed Audited Reviewed Audited (21 814) (11 187) (55 530) (28 185) SUPER GROUP Reviewed final results for the year ended 30 June

14 BUSINESS COMBINATIONS Subsidiaries and businesses acquired/disposed Nature of business Operating segment Date disposed/ acquired Interest (disposed)/ acquired (%) Purchase consideration (received)/ transferred GWM (S.A.) Proprietary Limited (GWM) Distributorship Dealerships SA 1 October 2014 (25) (15 000) Phola Coaches Proprietary Limited (Phola) Logistics Volvo, Land Rover and Tommy Martin Dealerships Dealerships Dealerships SA Allen Ford (UK) Limited (Allen Ford) Dealerships Dealerships UK Other acquisitions Logistics Supply Chain South Africa 1 July Supply Chain South Africa 25 August 2014 & 1 June December July 2014, 1 December 2014 & 1 April Total purchase consideration Fair value of assets acquired and liabilities assumed at date of (disposal)/acquisition: GWM Phola Volvo, Land Rover and Tommy Martin Dealerships Allen Ford Other acquisitions Total ASSETS Property, plant and equipment (12 561) Intangible assets Goodwill (2 959) Equity-accounted investee (3 992) (3 992) Deferred tax asset (20 925) (20 925) Inventories ( ) Trade and other receivables ( ) Provision for impairment of trade receivable (13 881) (9 782) Taxation receivable (6) (6) Cash and cash equivalents (59 279) ( ) LIABILITIES Interest-bearing borrowings Trade and other payables ( ) Income tax payable Provisions (37 794) (25 449) Deferred tax liabilities ( ) Acquirees carrying amount at (disposal)/ acquisition ( ) Non-controlling interest disposed/(acquired) (16 189) Loss on sale of subsidiary Deferred contingent consideration Investment in equity-accounted investee recognised Purchase consideration (received)/transferred (15 000) Cash disposed/(acquired) (2 916) ( ) (1 014) (99 234) Cash outflow

15 A 25% shareholding in GWM has been sold effective 1 October The Group has retained a 25,1% shareholding in GWM and it is being accounted for as an equity-accounted investee. The sale agreement gives rise to a deferred contingent purchase consideration which will be receivable after the finalisation of GWM's 30 June 2017 Annual Financial Statements. The acquisition of Phola positions the Group in the passenger transport sector. The Group performed a purchase price allocation exercise on Phola whereby intangible assets acquired were seperately valued. The valuation, using projected financial information led to the recognition of R28,6 million in respect of trade name, customer relationships and customer contracts. The acquisitions of the Nelspruit Volvo and Land Rover Dealership and Tommy Martin Delta dealerships in Roodeport bolsters the Dealerships division. The acquisition of Allen Ford expands the Dealerships division into the United Kingdom. The purchase price allocation exercise on Allen Ford led to the recognition of R68,8 million in respect of trade name and customer relationships. The other acquisitions enhance the Supply Chain South Africa division. The non-controlling interests have been calculated using the present ownership instruments proportionate share in the recognised amounts of the acquiree s identifiable net assets. Goodwill has been recognised on the acquisition of Phola, the South African dealerships, Allen Ford and the other acquisitions amounting to R62,2 million, R56,4 million, R405,6 million and R64,3 million respectively. Goodwill of R3,0 million has been derecognised on the disposal of GWM. Goodwill is attributable mainly to the skills and technical talent of the workforce and synergies expected to be achieved from integrating the acquired businesses into the Group s various operations. None of the goodwill is expected to be deductible for tax purposes. The acquisition related costs of R18,3 million relating to these acquisitions are included in the Profit and Loss. Impact of the acquisitions on the results of the Group Phola Volvo and Land Rover Dealerships Allen Ford Other acquisitions Total From the dates of acquisition, the acquired businesses contributed: Revenue Attributable profit/(loss) to equity holders of Super Group (1 086) Profit after tax, non-controlling interest and acquisition cost Net costs on increase in existing shareholding in subsidiaries: SG Fleet Digistics Total Non-controlling interest Effect of transactions between equity partners on equity (264) Cash outflow During the year the Group purchased an additional 1.46% shareholding in SG Fleet for R70,2 million and an additional 4.9% in Digistics for R8.7 million. If the above acquisitions had occurred on 1 July 2014 the contribution to revenue would have been R6 428,8 million, profit attributable to equity holders of Super Group for the year would have been R86,4 million and the profit after tax for the year would have been R90,1 million. SUPER GROUP Reviewed final results for the year ended 30 June

16 SALIENT FEATURES 30 June 30 June Reviewed Audited 1. INTEREST-BEARING BORROWINGS SG Fleet interest-bearing borrowings Asset-based finance Corporate bond Acquisition borrowings Property and other borrowings SHARE STATISTICS Total issued less treasury shares ( 000) Weighted number of shares ( 000) Diluted weighted number of shares ( 000) Net asset value per share (cents) CAPITAL COMMITMENTS Authorised but not yet contracted for capital commitments, excluding full maintenance lease assets Capital commitments will be funded from normal operating cash flows and the utilisation of existing borrowings facilities. 4. RELATED PARTY TRANSACTIONS The Group, in the ordinary course of business, entered into various sales and purchase transactions on an arms length basis with related parties. 5. SUBSEQUENT EVENTS Super Group announced the acquisition of a 75% equity interest in IN time, a German-based company providing time-critical delivery services across Europe. Super Group is acquiring the 75% interest from Equistone Partners. The enterprise value for IN time, via Telo Zwei Vermögensverwaltung GmbH (the holding company), before deducting the Euro debt of 58,0 million, is 153,5 million (approximately R2,1 billion). The settlement arrangement will be in the form of Super Group s 75% equity interest of 48,9 million (R685 million) and the Super Group Shareholder s Loan of 30,3 million (R424 million). IN time management will retain a 25% equity interest valued at 16,3 million (R228 million). The valuation of IN time was based on a historic PE multiple of 8.4 times and the effective return on equity, including the shareholders loans, is 11.9%. Super Group s investment will be funded via existing cash on hand within the Group and a proposed fully underwritten renounceable Rights Offer of approximately R900 million. The transaction is subject only to the successful completion of the proposed Rights Offer. The IN time presentation is available on Super Group s website 6. SIGNIFICANT EVENTS Allen Ford (UK) Limited acquisition The Group acquired 100% of Allen Ford (UK) for R614,5 million. The Statement of Financial Position of the Goup at 30 June 2015 has been impacted by increases in Property, plant and equipment of R294,5 million, Intangible assets of R69,3 million, Goodwill of R428,1 million, Inventories of R1 236,3 million, Trade and other receivables of R203,0 million, Long-term borrowings of R603,6 million and Trade and other payables of R1 419,9 million as a result of this acquisition. Trading relating to the seven months ended 30 June 2015 has been included in the Statement of Comprehensive Income. FleetAfrica contracts FleetAfrica has managed to secure a number of meaningful contracts, which has increased the Full maintenance lease assets and Full maintenance lease liabilities by R503,0 million and R363,6 million respectively, in the Statement of Financial Position. Phola Coaches Proprietary Limited acquisition The Group acquired 75% of Phola Coaches for R110,7 million. The Statement of Financial Position of the Group at 30 June 2015 has been impacted by increases in Goodwill of R62,2 million, Property, plant and equipment of R42,5 million and Intangibles of R21,3 million as a result of this acquisition. Trading relating to the 12 months ended 30 June 2015 has been included in the Statement of Comprehensive Income. GWM (S.A.) Proprietary Limited disposal During the year the Group disposed of 25% of its shareholding in the GWM Distributorship for R36,1 million (including present valued deferred contingent consideration). The Statement of Financial Position of the Group at 30 June 2015 has been impacted by decreases in Inventory of R250,7 million, Trade and other receivables of R116,2 million and Trade and other payables of R242,0 million as a result of this disposal. 14

17 7. FAIR VALUE Property, plant and equipment Land, buildings and leasehold improvements Hierarchy Level 2 Level 3 Investment properties Deferred contingent purchase consideration Valuation technique Valuation performed by Onyx valuation services. The valuation model considers the present value of net cash flows to be generated from these properties, taking into account expected rental growth rate, void period, occupancy rate, lease incentive costs such as rent-free periods and other costs not paid by tenants. The expected net cash flows are discounted using risk-adjusted discount rates. Among other factors, the discount rate estimation considers the quality of a building and its location (prime vs secondary), tenant credit quality and lease terms This valuation was performed using the present value of expected future profits, discounted using a rate of 5,6% after taxation. FEC Assets The fair values are based on broker quotes. Similar contracts are traded in an active market and reflect the actual transactions in similar instruments. FEC Liabilities Digistics put option This put option has been based on the average non-controlling interest non-proportionate share of the profit after tax for the last 3 financial years preceding the 1 October 2017 expiration of the put option at a price earnings ratio of 6,5. The present value has been determined using an after tax discount rate of 5,6% Safika Oosthuizens put option This put option is based on a fair market value of the business at 1 March 2016 minus 15%. The present value has been determined using an after tax discount rate of 5.6% The carrying value of all other financial instruments approximates the fair value of the financial instruments as at 30 June Movement in level 3 financial instruments measured at fair value The following table shows a reconciliation from the opening to closing balances of level 3 financial instruments carried at fair value: Financial assets Deferred contingent purchase consideration 30 June 2015 Reviewed Opening balance Disposal of subsidiary Fair value adjustment to profit and loss Financial liabilities Put option liabilities Opening balance Movement of NCI liability in statement of changes in equity: (2 640) Settlement (8 730) Fair value adjustment Sensitivity analysis The significant assumption included in the fair value measurement of the deferred contingent purchase consideration relates to the projected income that is not observable in the market. A change of 100bps to the significant assumption had no material impact on the fair value of the asset. The significant assumption included in the fair value measurement of the put option liabilities relates to the projected income that is not observable in the market. The following table shows how the fair value of the liabilities would change if the significant assumption was increased by 100bps: Increase in Fair value liability Digistics Safika Oosthuizens SUPER GROUP Reviewed final results for the year ended 30 June

18 NOTES 16

19 CORPORATE INFORMATION DIRECTORS: Executive: P Mountford (Chief Executive Officer) and C Brown (Chief Financial Officer) Non-Executive: P Vallet (Chairman of the company), Dr E Banda*, M Cassim*, V Chitalu*#, J Newbury* and D Rose* *Independent #Zambian COMPANY SECRETARY: N Redford REGISTERED OFFICE: 27 Impala Road, Chislehurston, Sandton, 2196 TRANSFER SECRETARIES: Computershare Investor Services Proprietary Limited (Registration number 2004/003647/07) Ground Floor, 70 Marshall Street, Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107) SPONSOR: Deutsche Securities (SA) Proprietary Limited (Registration number 1995/011798/07) 3 Exchange Square, 87 Maude Street, Sandton, 2196 INVESTOR RELATIONS: Keyter Rech Investor Solutions CC (Registration number 2008/156985/23) 5 2nd Road, Hyde Park, 2196 ADR INFORMATION: ISIN US86802E2072 CUSIP 86802E207 Structure Sponsored Level 1 ADR Exchange OTC Ratio (ADR:ORD) 1:5 Deutsche Bank Trust Company Americas c/o American Stock Transfer & Trust Company Peck Slip Station PO Box 2050 New York, NY DB@amstock.com Shareholder Service (toll-free) Tel: (866) Shareholder Service (international) Tel: (718) SUPER GROUP Reviewed Final results for the year ended 30 June 2015

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