Reunert results for the year ended 30 September 2012

Transcription

1 2012 Reunert results for the year ended 30 September 2012

2 2012 OVERVIEW Dave Rawlinson, Chief Executive

3 Agenda Welcome to attendees Operational performance Dave Rawlinson, Chief Executive Financial results Manuela Krog, Financial Director CBi-electric Alan Dickson, Managing Director, CBi-electric Nashua JHB CT Andy Openshaw, Managing Director, Nashua Communications Mark Taylor, Managing Director, Nashua Mobile (CT) 6 Executive team focus Dave Rawlinson, Chief Executive 3

4 Salient features Rbn Revenue 7% up 2012: R11.7bn 2011: R10.9bn Rbn Operating profit 10% up 2012: R1.5bn 2011: R1.4bn

5 Salient features Normalised HEPS 9% up 2012: 644.4c 2011: 590.0c Cents Final dividend 9% up 2012: 275 cents per share 2011: 253 cents per share Cents Cover x Interim Final Special Dividend cover 5

6 Operating profit contribution per segment H10 2H10 1H11 2H11 1H12 2H12 CBi-electric Nashua Reutech Half Year Full Year 6

7 Cash on hand Rbn Cash on hand (including internal financing deposited with Quince) Rbn (0.5) (1.0) (1.5) (2.0) Net cash on hand reduced by Quince borrowings Quince net borrowings 7

8 2012 OPERATIONAL PERFORMANCE

9 Operations CBi-electric Rbn Revenue 3.6 African Cables Slower than expected rollout of infrastructure spend Delays in contract renewals with parastatals constrained growth 3.0 Signing of several long-term contracts with public sector enterprises provides a revenue base 2.0 Power Installations division performing well Acquisition of Tank Industries provides expanded product range Low Voltage Experienced good export demand Rbn Operating profit 0.6 Profit margin 20% 15% 10% 5% Margins supported by a weaker Rand Local residential and mining markets static Progress with ITmatic and industrial controls businesses slow Activity levels in Australia lower due to slow down in mining sector Telecom Cables New high bit rate ADSL cable qualified in % This secured revenue stream from Telkom Export market penetration slow 9

10 Operations Nashua Rbn 8.0 Revenue 7.2 Nashua Mobile Loss of LCR 6.0 Further reduction in ARPU as a result of bundled tariffs affected Nashua Mobile 4.0 Nashua Office Automation 2.0 Increased unit sales, but margin pressure due to weakening rand and increased competition 0.0 Rbn Operating profit 0.8 Profit margin 12% Nashua ECN Successful integration migration of targeted LCR customers Merger with Nashua Communications supports a converged telecommunications offering % 6% 3% 0% Nashua Communications Acquisition of KSS provides Cisco networking capability Quince Capital Solid performance, increase of 11% in the rental book 10

11 Operations Nashua Mobile Nashua Mobile revenue analysis Subscriptions (excl. LCR) Airtime (excl. LCR) Airtime (LCR) Subscriptions (LCR) Mar-09 Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 11

12 Operations Reutech Rbn Revenue Overview Strong performance from all divisions Weakening rand increased margins from export sales 0.4 All operations have stable order books 0.2 Reutech Communications Acquisition of Natcom and SAAB Grintek HF radio business Rbn 0.3 Operating profit Profit margin 30% 25% Reutech Radar Systems Continued success of mining surveillance radar Reutech Solutions % 15% 10% 5% 0% 5 year contract for maintenance of defence force communications networks Fuchs Electronics Expedited long awaited export order 12

13 Investment in future capacity Rm Replacement Expansion Investment R&D 13

14 Corporate action Sales Natcom R7.1m Tank Industries R16.7m SAAB Grintek R29.7m Total R76.8m Nashua franchises R3.5m KSS Technologies R19.8m 14

15 2012 FINANCIAL RESULTS Manuela Krog, Financial Director

16 Group income statement Rm % Revenue EBITDA EBITDA % Operating profit (before interest and dividends) Operating profit % Effective tax rate (before abnormal item in 2011) % Headline earnings per share (cents) Normalised headline EPS (cents) Dividend yield Price earnings ratio For the year ended 30 September 16

17 Exports 8% 3% 21% Europe 41% 7% 20% Asia North America Africa Australasia South America Reutech has the greatest export revenue proportion, with exports comprising 55% of segment revenue Export revenue for CBi-electric amounted to 12% of segment revenue 17

18 Group balance sheet Rm Total non-current assets Current assets Total assets Shareholders equity Non-controlling interests Non-current liabilities Current liabilities Total equity and liabilities Total liabilities to shareholders funds % Current ratio (times) Normalised return on ordinary shareholders funds % As at 30 September 18

19 Cash flow (Rm) (85) 495 (105) (291) Opening balance Cashflow from operating activities inlcuding traditional working capital Increase Increase in asset in Quince rental book asset Increase in device handset finance Investing activies rental book (Nashua subsidies Mobile) Financing activities Closing balance 19

20 Segmental revenues % 6% 31% 30% 2012 R11 662m 2011 R10 906m 62% 64% CBI-electric Nashua Reutech 20

21 Segmental analysis operating profit 3 (17) CBI-electric Nashua Reutech Other NSN 2012 Operating profit - Rm 2012 % % 2011 % CBi-electric Nashua Reutech Other (57) (4) 5 (61) (4) Total operations NSN - 17 Operating profit as reported For the year ended 30 September 21

22 Operations research and development 2012 Total R&D Rm Self-funded CBi-electric Nashua Reutech Total

23 2012 Nashua JHB: Andy Openshaw, Managing Director, Nashua Communications CT: Mark Taylor, Managing Director, Nashua Mobile

24 ECN post acquisition Nashua ECN Monthly Minutes, Nov '09 - Oct ' Nov-09 Feb-10 May-10 Aug-10 Nov-10 Feb-11 May-11 Aug-11 Nov-11 Feb-12 May-12 Aug-12 Mobile Local National Inbound Special International On-Net Successful integration Exceeded profit targets LCR migration targets exceeded Interconnect rates continue to drop Efficiency and volume support sustainability and boost margins Lower interconnect rates benefit new entrants 24

25 New Nashua Communications Creating a strategic platform for future growth 25

26 Focus for 2013 Creating a strategic platform for future growth Customers SERVICE DELIVERY COLLABORATION SOLUTIONS DIRECT SALES SOLUTION ENGINEERING DATA CENTRE SOLUTIONS NETWORK SOLUTIONS TECHNOLOGY MANAGEMENT INDIRECT SALES CARRIER / CLOUD SOLUTIONS TRAINING ADMINISTRATION AND SUPPORT 26

27 Key milestones achieved Cisco Gold Partner certification achieved in November 2012 Cisco Big Bet backing in the corporate data centre space Siemens Openscape platform deployed in the ECN cloud ECN Hosted PBX and Mobile Voice applications launch in the new year Successful cross selling achieved for combined PBX and voice offerings through the Nashua OA channel 27

28 Nashua Mobile key focus points for 2013 To support growth initiatives the business has been restructured into: Consumer and Enterprise Customer Operations to provide support Create efficiencies Focus on margin growth New network agreements will be concluded soon 28

29 Nashua Mobile Retail Refresh hardware technologies Update and redo the retail stores Address technology in the stores to have the same POS and Accounting system Automated credit collection system Revamp the front-end systems Grow retail footprint by partnering with stores In-store concept Cost effective Adding 100 new Nashua Mobile touch points 29

30 Nashua Mobile Enterprise Focus on SME and SMME Better margins and growth opportunities Augment our product suite to help drive more services into this base There is pressure for more discounts in the corporate space Refresh and revamp the technology Self-serve Account executives can serve customers at their offices in real time 30

31 Nashua Office Automation Strategy to follow a two-pronged approach for 2013 Maintain and grow current hardware and service model Grow production printing Improve penetration into strategic accounts Continuous training, motivation and support via our existing franchise channel Transform into a services-led organisation - Focus more on solutions than pure product Managed print service solutions Managed document service solutions - Provide document tracking, archiving, indexing or business process optimisation 31

32 Nashua companies working together Customers continue to look for a consolidated product offering Our businesses will continue to work and move closer together Each bringing their expertise, solutions and routes to market Into a converged product environment Cross selling across and between our customer bases is yielding good returns and adding to our brand strength Collaboration on consolidated product offerings to key clients Working together on the evolution of unified communications and cloud driven services across the product ranges 32

33 CBi-electric Alan Dickson, Managing Director, CBi-electric

34 Market conditions Market conditions are predominantly driven by state infrastructure projects 1a Generation build (IRP 2010) YEAR Coal, Pumped Storage & Eskom Wind (MW) Total generation build

35 Market conditions Market conditions are predominantly driven by state infrastructure projects 1b Transmission expansion (TDP) Transmission Assets New assets expected in HVDC 0 765kV Lines (km) kV Lines (km) kV Lines (km) 52 Total kms of line

36 Market conditions Market conditions are predominantly driven by state infrastructure projects 2 Renewable energy Window 1 (MW) Window 2 (MW) Remaining by 2016 (MW) Solar PV Solar CSP Wind R18bn local content in Window 1 and will grow in subsequent Windows Window 2 financial closure in March 2013 An additional 3 200MW between

37 Market conditions 3 Residential ZAR (m) 6.0 Buildings reported as completed Constant 2005 prices Stable 37

38 Market conditions 14 Welcome Commercial to attendees Chance of improved conditions 5 Mining Operational mining expected to continue at pre-unrest levels Deep level mining capital to be significantly reduced Iron ore and coal are primary drivers of capital expenditure 38

39 Head winds Mining uncertainty on project roll out Rising cost base (electricity and labour) Increasing competition and margin pressure State infrastructure execution risks 39

40 Positioning Strong local corporate responsibility Level 2 BBBEE Product designation Local manufacture investment Reduced component exposure by expanding in Value Added Services business IT Matic Power Installations Tank Acquisition Export 12% of CBi-electric group revenue across the world Rand hedge 40

41 Positioning Proven track record on operating efficiencies Well positioned within the electrical sector which has strong demand and long term fixed investment Eskom Renewable Energy Transnet 41

42 Executive team focus Dave Rawlinson, Chief Executive

43 Team focus 2013 CBi-electric 1 Local supplier of choice for R18 billion local spend on renewable energy roll-out 2 Increase export activity in Europe, USA and Africa 3 Participate actively in Eskom and Transnet expansion 43

44 Team focus 2013 Nashua Grow customer base and minutes on voice network Market penetration in converged voice and data network space Roll-out recently developed products for Hosted PBX Mobile voice Data storage 4 Grow mobile customer base Increase outlets in retail space Automate customer processes Service excellence 5 Accelerate roll-out of office solutions 44

45 Team focus 2013 Reutech Integrate Saab Grintek and Natcom acquisition into Reutech Communications Increase MSR market penetration Secure further orders for concentrated photovoltaic tracker solution Obtain and execute set-top box order Secure further export orders for Fuchs 45