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2016 Final Results

Aug 30 2016

Super Group reports super growth of 103% in offshore revenue contribution

Johannesburg, 29 August 2016 – Super Group, a leading transport logistics and mobility group, reported a solid set of results for the year ended 30 June 2016 despite the competitive business environment in the geographical locations in which the Group operates. The final results include Allen Ford’s (UK) results for the full year compared to seven months in the prior year, SG IN tIME’s (Supply Chain Europe’s) results for eight months and NLC Proprietary Limited’s (NLC’s), through SG Fleet (Australia), results for seven months.Peter Mountford, Group CEO, commented: “We managed to expand our international footprint substantially with the various offshore acquisitions concluded over the past two years and at year end, the non-South African businesses contributed 42% and 60% to revenue and operating profit, respectively. We are pleased to report that the growth in offshore revenue was 103%, operating profit 66% and profit before taxation 52% over the reporting period.”

Group revenue increased by 30.9% to R25,9 billion from R19,8 billion for the year to 30 June 2015 mainly as a result of the commendable performances by FleetAfrica, SG Fleet and Dealerships as well as the inclusion of the results of Allen Ford (UK), SG IN tIME and NLC (through SG Fleet), for the periods previously mentioned.

The main reason for the increase of 30.0% in operating profit to R1,952 million (June 2015: R1,501 million) being marginally below revenue growth, was due to the poor performance by SG Coal in the first half of the year. If SG Coal’s results, part of Supply Chain Africa, are excluded, then the decline of 13.7% in Supply Chain Africa’s operating profit would have been an increase of 3.3%.

Earnings per share and headline earnings per share increased by 12.2% to 297 cents and 10.4% to 293 cents, respectively. The net asset value per share increased by 30.7% for the year to 2 196,4 cents at 30 June 2016.

The increase in total assets of 49.1% to R22,8 billion is mainly as a result of the newly acquired assets of SG IN tIME and NLC during the year under review. The Group’s normalised Return on Net Operating Assets, after tax and excluding the effects of acquisitions during the period, was 15.5%. Super Group is satisfied with this return given the growth in offshore earnings where the weighted average cost of capital is lower than South Africa.

“Super Group’s borrowings increased by R993 million to R1,989 million, with R1,479 million debt attributable to SG Fleet largely for the NLC acquisition and R906 million debt attributable to the acquisition of SG IN tIME, Germany. We concluded a Rights Offer of R900 million in October 2015 to part fund the SG IN tIME acquisition and an Accelerated Bookbuild Offer of R360 million in December 2015 to bolster the Group’s capital structure following the acquisition of NLC by SG Fleet. As a result of the cash generated within the newly acquired businesses, the Group was able to reduce its total gearing from 31.9%, as at 31 December 2015, to 21.4% as at 30 June 2016;” reported Colin Brown, CFO of Super Group. He confirms this statement by saying that operating cash flow increased by 24.9% for the year to R2,652 million with a working capital cash inflow of R245 million as opposed to an outflow of R102 million in the prior year. As a result, cash generated from operations, after working capital, increased by a pleasing 43.4% to R2,897 million.

On 17 May 2016 Super Group announced the acquisition of nine Western Cape dealerships for a consideration of approximately R490 million and a strategic property for R200 million from Sandown Motor Holdings Proprietary Limited, a subsidiary of Mercedes-Benz. This transaction was subject to Competition Commission approval which was obtained in July 2016 and is expected to be effective 1 September 2016. The rationale for this transaction is in line with Dealerships SA’s strategy to make selective acquisitions of dealerships to expand its geographical footprint. Subsequent to year end, SG Fleet announced the acquisition of Fleet Hire, a UK contract hire, salary sacrifice, short-term rental and fleet management provider, for an acquisition price of £19,6 million effective August 2016. The acquisition provides SG Fleet with scale and profitable growth in the UK, and importantly, Fleet Hire establishes a platform for the company to build on and execute its strategic plans in this attractive market.

Mountford concludes: “The South African market conditions are expected to remain challenging and competitive with various industries remaining under pressure. Despite the subdued outlook for the country, the Group’s strategy is to explore strategic investment opportunities internationally and in South Africa to maintain the Group’s position as an innovative, integrated mobility solutions company.”

Final Results PDF (738 KB)
Press Release PDF (216 KB)
Press Advert PDF (1.6 MB)
Investor Presentation PDF (2.8 MB)