Investors Presentation 10 & 11 May 2005 FOR THE SIX MONTHS ENDED 31 MARCH 2005

Transcription

1 Investors Presentation 10 & 11 May 2005 FOR THE SIX MONTHS ENDED 31 MARCH 2005

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4 FACT SHEET FOR SIX MONTH PERIOD Current market capitalisation R6,9 billion Revenue R3,3 billion EBITDA R460 million EBITDA as % of turnover 14% Interim dividend 52 cents per share Share price: 9 May 3724 Weighted average number of shares used to calculate earnings per share 173 million

5 HIGHLIGHTS FOR THE 6 MONTH PERIOD Impact of compulsory share buyback 9% Electrical group slowly taking form ATC & African Cables business combined BEE partner finalised New products launched Improved ROE from 50,5% to 62,9%

6 FINANCIALS

7 SOLID FINANCIAL PERFORMANCE HEPS up 31% cents (HY04: cents) Turnover increased by 9% R3,3 billion Operating profit increased by 28% R433 million Headline earnings improved to R313 million Interim dividend of 52 cents per share 30% up

8 DIVIDENDS (cents per share) Interim Final Linear (Interim)

9 INCOME STATEMENT HY05 HY04 % Rm Rm change Revenue 3, , EBITDA Operating profit Net interest and dividend income (42) Profit before taxation Profit after taxation Share of associate companies' profits (11) Earnings attributable to RLO shareholders HEPS (cents) Taxation rate (% )

10 BALANCE SHEET R million 31 March March 2004 Non-current assets Property, plant and equipment Goodwill Investments Finco accounts receivable Deferred taxation assets , Current assets Inventory & contracts in progress Accounts receivable Cash and cash equivalents (net) ,799 1,923 Total assets 3,163 2,776 Shareholders' funds 1,155 1,377 Non-current liabilities Current liabilities 1,961 1,339 Total equity and liabilities 3,163 2,776

11 GROUP CASH FLOW INFORMATION R million EBITDA (Increase)/decrease in net working capital (312) 1,065 Finco receivables (232) 984 Other working capital (80) 81 Cash generated from operations 148 1,455 Net interest and dividends received (incl associates) Taxation paid (244) (199) Dividends paid (incl outside shareholders) (218) (192) CASH GENERATED BY OPERATIONS (257) 1,093 Capital expenditure (23) 7 Acquisitions and other investments (3) (47) Other (net) Actual net cash flow (273) 1,064 Movement in Finco borrowings 311 (1,044) Net cash flow adjusted for Finco borrowings 38 20

12 PROFITABILITY RATIO S EBITDA % Operating margin (%) HY HY05

13 PROFITABILITY RATIO S 70 Return on equity (%) Return on net operating assets (%) HY HY05

14 SEGMENTAL ANALYSIS REVENUE HY05 % HY04 % Rm Rm Electrical Engineering Electronics Office systems (17) Consumer products and services 1, , Telecommunications Reutech (26) Total Electronics 3, , Total operations 3, , Less: Reunert's attributable portion of associate companies' revenue (704) (704) % change Revenue as reported 3,276 3,012 9

15 SEGMENTAL ANALYSIS OPERATING PROFIT BEFORE HY05 % HY04 % % GOODWILL AMORTISATION Rm Rm change Electrical Engineering Electronics Office systems Consumer products and services Telecommunications (7) Reutech (4) (1) 16 4 (125) Total Electronics Total operations Less: Reunert's attributable portion of associate companies' net operating profit (53) (57) Operating profit before goodwill

16 % Contribution Revenue Telecom 18% Reutech 3% Operating profit Consumer 32% Telecom 11% Reutech -1% Electrical 22% Electrical 35% Consumer 46% Office systems 11% Office systems 23%

17 GROUP OPERATIONS

18 CBI Residential sector buoyant Depressed sales Mining Exports Mainly due to stronger rand Launched wiring accessories in February Rapid market share gains Heinemann Australia Acquired July 2004 Ahead of budget Launching Mitsubishi product range New plant in Lesotho Operational

19 ATC Trading profitably Acquisition of African Cables business completed Powerhouse Utilities 25,1% shareholding Life after Telkom Nearly 60% of orders received are non-telkom 21% exports Diversifying customer base Process/Petro Chemical market Data communications market Mining

20 AFRICAN CABLES (division of ATC) Order intake continues to grow Powerhouse Utilities 25,1% empowerment partner Capacity constraints addressed R6 million invested to date Rod conversion plant: R16 million 3 additional machines: R16 million Should be on stream January 2006 Cafca in Zimbabwe Supplying copper rod & Bells cable Productivity issues to be addressed Exports Needs attention Current capacity constraints

21 NASHUA Nashua Kopano Black owned franchise merged with Nashua Direct business BEE shareholding 26% Strong growth in volumes of multi functional machines Printer sales: increased 2½ times previous year Colour printer sales twice that of previous year Increased total document volume March: 314 million prints Launching Nashua Broadband 1 June Based on same recipe as Nashua Mobile Service Provider for telecomms operators Sentech, Telkom & others

22 NASHUA FINANCE Successfully rebuilt the finance book after sale in 12/03 R761 million Swaps taken Book 20% linked rates. 80% fixed rates contracts on own book Average period 3 1 / 2-4 years

23 NASHUA MOBILE Buoyant consumer demand continued Customer base has grown by since year-end contract subscribers Sept contract subscribers March 05 Real average revenue per user R534 (Handset business R457 + LCR R1 623) FY04: R538 Revenue 70% handset business 30% specialised services Stronger focus on blue-chip individuals Distribution model Increase touch points Expect number portability to be introduced March 2006

24 REUNERT CONSUMER & COMMERCIAL Distributor of consumer electronics and business systems Multiple brands Panasonic, Futronic, Nintendo New brand: Akai Consumer product prices continued to decline Higher volumes sold Market position greatly improved

25 REUTECH Order book is a serious concern Difficult trading conditions Denel situation Suspension of Armscor senior personnel International markets wary of SA

26 SIEMENS TELECOMMUNICATIONS Strong order book Exchange rate has a negative impact on absolute profits STC Fixed line business Telkom upgrade of switches to soft switch status continues Mobile business Vodacom 3G roll-out nearing completion (initial phases) Cell C considering 3G

27 PROSPECTS With the exception of Reutech, the group s operations are expected to enjoy buoyant market conditions. Reunert should continue to deliver real headline earnings growth.

28 CHANGES TO BOARD DE Cooper Resign as chairman MJ Shaw Incoming chairman KS Fuller Non-executive director Chairman of audit committee

29 Contact details Carina de Klerk Tel