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The Bidvest Group Limited - Audited Results for the year ended June 2003
THE BIDVEST GROUP LIMITED
REGISTRATION NUMBER: 1946/021180/06
ISIN: ZAE000008132
Share code: BVT
RESULTS FOR THE YEAR ENDED JUNE 30 2003
The Bidvest Group is listed on the JSE Securities Exchange South Africa in the
Cyclical Services - Support Services sector with subsidiaries listed on the
London, Australian and Luxembourg stock exchanges.
2003 2002 % change
Revenue R47,1bn R41,95bn 12,2%
Operating income R2,2bn R2,02bn 11,5%
Operating income pre
translation gains R2,3bn R1,9bn 18,3%
Headline earnings R1,5bn R1,3bn 13,1%
Headline earnings per share 479,0c 436,2c 9,8%
Total distribution per share 220,0c 190,0c 15,8%
Operating margin 4,8% 4,6%
FINANCIAL HIGHLIGHTS
- Fourteen consecutive years of growth
- A compound growth rate in earnings per share over the past twelve years of
27,7%
- SA organic growth in operating income of approximately 16%
- Results impacted by:
- R117,7 million negative movement in unrealised currency losses on the
translation of foreign cash resources
- R73,0 million negative impact of the dollar-based fishing operations recording
lower incomes in local currency and the reduced quality of the catch
- R13,2 million reduced contribution from Bidcorp plc
- R8,9 million non-recurring loss from a discontinued business to the date of
closure
- R30,8 million increase in interest charges
- Without the effects of the conversion of offshore cash resources, headline
earnings per share would have increased by 20,4%
OPERATIONAL HIGHLIGHTS
- Unique and innovative black economic empowerment (BEE) initiative announced
- A number of small, but strategic acquisitions were made extending the range of
products offered and geographic spread of operations
- Swithenbank, a fresh product distribution business acquired by 3663 First for
Foodservice
- Danel SA (renamed Lithotech France), acquired out of receivership, made a
profit for the period
- Extensive restructuring in Bidcorp plc completed, at significant cost, but the
operations should make a meaningful contribution in the future
- Cross-selling progressing well
- Provision of integrated service solutions in Bidserv well received by market.
Other divisions also beginning to formulate integrated, packaged offerings
- mymarket.com service offering gaining impetus - currently has 32 buying
organisations and 660 suppliers listed with 5 637 users
Brian Joffe, Executive Chairman, commented:
"Bidvest"s decentralised and entrepreneurial business model has again shown that
solid operational performances are possible even in volatile markets. By
managing in real time and making innovative changes in response to changing
markets, our management teams appropriately positioned the businesses and
increased operating profit."
Fani Titi, Deputy Chairman, commented:
"By not forcing the pace of acquisitions, Bidvest"s strategic patience has paid
off. In the current volatile and difficult trading conditions numerous
opportunities surfaced. I have no doubt that Bidvest will be able to capitalise
on these prospects."
August 25 2003
ENQUIRIES:
The Bidvest Group Limited Tel: + 27 (11) 772 8700
Brian Joffe, Chairman
Jack Hochfeld, Investor Relations
David Cleasby, Investor Relations
Beachhead Media and Investor Relations Tel: +27 (11) 214 2400
Jennifer Cohen
Jaqui Swan
THE BIDVEST GROUP LIMITED
REGISTRATION NUMBER: 1946/021180/06
ISIN: ZAE000008132
Share code: BVT
CONSOLIDATED AUDITED RESULTS FOR THE YEAR ENDED JUNE 30 2003
HIGHLIGHTS
- Fourteen consecutive years of growth
- Revenue up 12,2%
- Operating income up 11,5%
- Headline earnings up 13,1%
- Headline earnings per share up 9,8%
- Headline earnings per share excluding translation gains up
20,4%
- Distribution per share 15,8%
CONSOLIDATED INCOME STATEMENT
for the year ended June 30
2003 2002 Percentage
R"000 R"000 change
Revenue 47 073 375 41 950 388 12,2
Operating income 2 244 121 2 012 611 11,5
Operating income before
translation gains 2 259 197 1 909 966 18,3
Translation gains (losses) (15 076) 102 645
Amortisation of goodwill (64 887) (52 646)
Disposal and discontinued
businesses (36 130) (11 797)
Disposal of fixed assets (25 418) 330
Net finance expense (110 982) (80 163)
Income before taxation 2 006 704 1 868 335 7,4
Taxation (557 148) (515 264)
Income after taxation 1 449 556 1 353 071 7,1
Income from associates 30 328 17 735
Trading profits 31 568 27 788
Impairment of and goodwill
in associates (1 240) (10 053)
Outside shareholders"
interest (97 576) (129 557)
Income attributable to
shareholders 1 382 308 1 241 249 11,4
Number of shares in
issue (weighted 000) 308 116 299 089
Headline earnings per
share (cents) 479,0 436,2 9,8
Earnings per share (cents) 448,6 415,0 8,1
Distribution per
share (cents)* 220,0 190,0 15,8
- interim 108,0 90,0
- final 112,0 100,0
Headline earnings
The following adjustments
to income attributable
to shareholders were taken
into account in the
calculation of headline
earnings:
Income attributable to
shareholders 1 382 308 1 241 249
Net amortisation of
goodwill 61 449 49 411
Amortisation of goodwill 64 887 52 646
Outside shareholders"
interest (3,438) (3 235)
Net loss on disposal
and discontinued
businesses 11 626 3 913
Loss on disposed and
discontinued business 36 130 11 797
Tax relief (16 017) (4 363)
Outside shareholders"
interest (8 487) (3 521)
Net loss on disposal
of assets 19 233 104
Loss (surplus) on
disposal of assets 25 418 (330)
Tax relief (7 385) -
Outside shareholders"
interest 1 200 434
Impairment of and goodwill
in associates 1 240 10 053
Headline earnings 1 475 856 1 304 730 13,1
Rand/Sterling exchange
rates
Opening rate 15,905 11,338
Closing rate 12,457 15,905
Average rate 14,288 14,544
The conversion of foreign cash resources has resulted in an unrealised exchange
loss of R15,1 million for the year ended June 30 2003 as compared to R102,6
million gain in the comparable period. If the effect of these gains are
eliminated from the results, headline earnings per share would have increased by
20%.
*Includes dividends, distribution out of share premium and capitalisation issues
at market value at date of the award.
SEGMENTAL ANALYSIS
for the year ended June 30
2003 2002 Percentage
R"000 R"000 change
Revenue
The Services Division 18 292 281 16 424 403 11,4
Bidfreight 13 676 421 12 984 127 5,3
Bidcorp plc 1 956 688 1 078 403 81,4
Namsov Fishing 282 107 320 993 (12,1)
Bidserv 1 735 005 1 505 982 15,2
Renfin 642 060 534 898 20,0
The Foodservice
Products Division 22 557 416 21 121 321 6,8
Bidvest plc 19 733 754 18 741 489 5,3
Caterplus 1 970 925 1 653 732 19,2
Combined Foods 852 737 726 100 17,4
The Commercial
Products Division 7 584 909 5 500 712 37,9
Bidoffice 4 743 195 3 512 837 35,0
Bidpac 730 579 625 537 16,8
Voltex 2 111 135 1 362 338 55,0
Corporate Services 93 920 159 387 (41,1)
I-Fusion 90 665 159 225 (43,1)
mymarket.com 3 255 162 1 909,3
Intergroup eliminations (1 455 151) (1 255 435) -
47 073 375 41 950 388 12,2
Operating income
The Services Division 750 502 718 570 4,4
Bidfreight 395 400 355 971 11,1
Bidcorp plc 834 14 034 (94,1)
Namsov Fishing 31 497 104 509 (69,9)
Bidserv 166 713 134 317 24,1
Renfin 156 058 109 739 42,2
The Foodservice
Products Division 843 449 672 927 25,3
Bidvest plc 569 434 460 875 23,6
Caterplus 179 817 132 493 35,7
Combined Foods 94 198 79 559 18,4
The Commercial
Products Division 613 342 487 675 25,8
Bidoffice 393 845 313 715 25,5
Bidpac 103 069 84 142 22,5
Voltex 116 428 89 818 29,6
Corporate Services 36 828 133 439 (72,4)
I-Fusion (5 042) (9 096) 44,6
mymarket.com (7 242) (2 172) (233,4)
Investment and
other income 8 317 108 904 (92,4)
Group properties 40 795 35 803 13,9
2 244 121 2 012 611 11,5
% %
Operating margins
The Services Division 4,10 4,38 (6,2)
Bidfreight 2,89 2,74 5,5
Bidcorp plc 0,04 1,30 (96,7)
Namsov Fishing 11,16 32,56 (65,7)
Bidserv 9,61 8,92 7,7
Renfin 24,31 20,52 18,5
The Foodservice
Products Division 3,74 3,19 17,4
Bidvest plc 2,89 2,46 17,3
Caterplus 9,12 8,01 13,9
Combined Foods 11,05 10,96 0,8
The Commercial
Products Division 8,09 8,87 (8,8)
Bidoffice 8,30 8,93 (7,0)
Bidpac 14,11 13,45 4,9
Voltex 5,51 6,59 (16,4)
4,77 4,80 (0,6)
STATEMENTS OF CHANGES IN SHAREHOLDERS" INTEREST
for the year ended June 30
2003 2002
R"000 R"000
Shareholders" interest at the
beginning of the year 5 563 617 3 860 494
Share capital issued (427) 770
- capitalisation issue - 107
- cash issue - 623
- in terms of the share
incentive scheme 62 71
- repurchase of shares by subsidiary (489) (31)
Share premium arising on
shares issued (537 993) 409 300
- in terms of the share
incentive scheme 31 780 40 067
- cash issue - 557 377
- refund of share premium to
shareholders (168 797) (159 743)
- repurchase of shares by
subsidiary (400 844) (26 725)
- share issue costs (132) (1 676)
Movement in non-distributable
reserves (474 927) 329 882
- foreign currency translation
reserve (474 927) 329 882
Movement in retained income 862 389 963 171
- income attributable to
shareholders 1 382 308 1 241 249
- dividends and capitalisation
issues (475 284) (267 870)
- secondary tax on companies (44 635) (10 208)
Shareholders" interest at the
end of the year 5 412 659 5 563 617
CONSOLIDATED BALANCE SHEET
at June 30
2003 2002
R"000 R"000
Assets
Non-current assets 4 927 958 5 118 290
Fixed assets 3 493 246 3 602 498
Intangible assets 689 218 681 903
Deferred taxation 219 340 262 747
Investments and advances 384 072 378 997
Banking and other advances 142 082 192 145
Current assets 9 643 424 9 998 814
Other current assets 7 282 863 7 253 322
Liquid funds 2 360 561 2 745 492
Total assets 14 571 382 15 117 104
Equity and liabilities
Capital and reserves 6 103 451 6 370 033
Shareholders" interest 5 412 659 5 563 617
Outside shareholders" interest 690 792 806 416
Non-current liabilities 1 007 749 615 836
Deferred taxation 115 824 252 048
Post-retirement obligations 190 179 200 250
Long-term portion of
interest-bearing borrowings 665 583 135 838
Banking liabilities 36 163 27 700
Current liabilities 7 460 182 8 131 235
Other current liabilities 6 794 077 6 887 622
Current portion of
interest-bearing borrowings 666 105 1 243 613
Total equity and liabilities 14 571 382 15 117 104
Number of shares in issue (000) 302 679 311 217
Net tangible asset value
per share (cents) 1 561 1 569
CONSOLIDATED CASH FLOW STATEMENT
for the year ended June 30
2003 2002
R"000 R"000
Cash flow from operating activities 1 506 715 1 967 371
Operating income net of
capital items 2 182 573 2 001 144
Depreciation and other
non-cash items 746 026 543 348
Changes in working capital (261 904) 207 183
Cash generated by operations 2 666 695 2 751 675
Net finance expense (110 982) (80 163)
Taxation paid (521 492) (395 737)
Distributions to shareholders
- Company (475 284) (267 763)
- subsidiaries (52 222) (40 641)
Cash effects of investment
activities (1 167 628) (1 956 063)
Net additions to fixed assets (991 232) (695 118)
Net additions to intangible
assets (8 442) (18 759)
Net acquisition of subsidiaries,
businesses, associates and
investments (167 954) (882 186)
Cash effects of financing
activities (70 234) 525 622
Proceeds from shares issued
- Company 31 710 596 462
- subsidiaries 7 670 506
Purchase of treasury shares (401 333) (26 756)
Distribution of share premium
to shareholders (168 797) (159 743)
Net borrowings raised 460 516 115 153
Net increase in cash and
cash equivalents 268 853 896 930
Net cash and cash equivalents
at the beginning of the year 2 202 331 1 058 213
Currency adjustments (250 840) 247 188
Net cash and cash equivalents
at the end of the year 2 220 344 2 202 331
Net cash equivalents are
made up as follows
Cash on hand and in the bank 2 360 561 2 745 492
Bank overdrafts shown as current
portion of interest-bearing debt (140 217) (543 161)
2 220 344 2 202 331
BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements have been prepared in accordance with South African
Statements of Generally Accepted Accounting Practice and the accounting policies
used are consistent with the prior year.
AUDIT REPORT
The consolidated results for the year have been audited by KPMG Inc and their
unqualified audit report is available for inspection at the Company"s registered
office.
COMMENT
Bidvest achieved satisfactory results and a solid operational performance,
delivering its fourteenth consecutive year of growth. Management performed well
recording significant organic growth. Operating margins improved in an
environment of an appreciating currency.
The results may be below market expectation, principally due to the R117,7
million negative movement in unrealised currency losses on the translation of
foreign cash resources; the R73,0 million negative impact of the dollar-based
fishing operations recording lower income in local currency and the reduced
quality of the catch; the R13,2 million reduced contribution from Bidcorp; and
an R8,9 million non-recurring loss from a discontinued business to the date of
closure.
OPERATING ENVIRONMENT
The year was characterised by volatile international markets, re-inforced by the
build-up to, the outbreak and aftermath of the war in Iraq. The world"s advanced
economies recorded a real growth rate of less than 2%.
South Africa"s firm commitment to monetary and fiscal discipline, improvements
in competitiveness and sound economic performance was recognised and rewarded by
two international credit ratings. This positive sentiment also surfaced in the
foreign exchange market where the rand outperformed most other currencies. High
domestic interest rates and the positive balance of trade further contributed to
the improved rand. Nevertheless, the Group"s managers positioned their
businesses to minimise the impact of the currency"s volatility.
FINANCIAL HIGHLIGHTS
Revenue grew by 12,2% to R47,1 billion (2002: R42,0 billion) and the operating
margin, excluding movements in translation gains on cash resources, increased to
4,8% (2002: 4,6%). Operating income amounted to R2,2 billion (2002: R2,0
billion), an increase of 11,5%.
Headline earnings increased by 13,1% to R1,5 billion (2002: R1,3 billion), with
headline earnings per share increasing by 9,8% to 479,0 cents per share (2002:
436,2 cents per share). If the effects of the conversion of offshore cash
resources were eliminated from the results, headline earnings per share would
have increased by 20,4%.
A compound growth rate in headline earnings per share over the past twelve years
of 27,7% per annum has been achieved.
Income attributable to shareholders increased by 11,4% to R1,4 billion (2002:
R1,2 billion).
Total distributions to shareholders increased by 15,8% to 220,0 cents per share
(2002: 190,0 cents per share).
Bidvest bought back shares worth R401,3 million. This in no way reflects on the
considerable prospects available to the Group. The balance sheet remains strong,
with adequate funding capability to pursue opportunities as and when they arise.
The Group is currently ungeared on a net basis, yet is generating returns in
excess of its cost of capital. Given the right circumstances Bidvest would
increase its debt to equity ratio to 40%.
Fitch Ratings reaffirmed our credit rating as a AA- (zaf).
BUSINESS HIGHLIGHTS
BLACK ECONOMIC EMPOWERMENT
Black economic empowerment (BEE) in South Africa is both a business and national
imperative and considerable management resources were focused on evaluating the
role of BEE within Bidvest and creating an innovative solution.
In July 2003 Bidvest announced a major BEE initiative whereby Dinatla, a
dedicated and credible, broad based empowerment consortium, would, subject to
shareholder approval, become a 15% shareholder in the Group. The initiative is
well on track and the required documentation is almost complete. We expect to
implement the initiative by early November 2003, further evolving Bidvest into a
truly empowered organisation.
CORPORATE GOVERNANCE
Good corporate governance has always been an important part of the Bidvest
culture, where it is a way of life rather than a set of rules. Bidvest is one of
only three South African companies included in the Dow Jones Sustainability
Index, selected on the basis of strategy, innovation, financial performance and
stakeholder relations.
One needs to guard against restrictive corporate governance where undue
administrative requirements place pressure on businesses. Notwithstanding this,
Bidvest"s entrepreneurial flair is maintained within the bounds of good
corporate governance.
We are confident that our corporate governance meets the highest standard and
will continue to contribute to sustained value creation and long-term
performance.
The composition and size of the Board will be reviewed in light of the recently
announced BEE initiative.
STRATEGIC REVIEW
Bidvest is ideally positioned for growth with control over our routes to market
and distribution channels. Our solid international businesses are poised for
further expansion and recognised empowerment credentials will further drive
local growth. The businesses are finely tuned and we have excellent management
teams.
Bidvest has developed and operates primarily in emerging markets, where
diversification creates critical mass, providing the funds and management talent
from existing operations to expand, start and fund new ventures. Management
talent is cultivated by exposure to a wide variety of situations. From our
diversity we build strength.
Customers drive our business strategy. We continually look at our product and
service offerings in light of the ever-changing customer requirements and grow
and develop our businesses accordingly - extending our reach into each customer.
Related diversification around common operations or functions to the same set of
customers removes volume constraints imposed by the size of a given industry.
The success of Bidvest"s decentralised and entrepreneurial strategy has shown
that sustainable results are not only created in growing markets. Bidvest has
consistently improved its performance in sometimes stagnant and often mature
industries through increased efficiencies and market share growth.
The Group remains acquisitive by nature and committed to expanding its
distribution, services and trading strategy. Bidvest uses acquisitions not to
achieve breakthrough, but rather to accelerate momentum. Finding the right
acquisitions at the right price and at the right time requires skill and
patience. Successful acquisitions require the insight and experience to
facilitate a smooth integration. Bidvest is well known for its ability to
identify underperforming assets and to achieve remarkable turnarounds.
Bidvest continues to look for acquisitions in South Africa and abroad to expand
our service offerings. Progress has been made in SouthAfrica in the development
of our integrated service solution concept and cross-selling between Group
companies, particularly through mymarket.com, is beginning to gain impetus.
OPERATIONAL REVIEW
THE SERVICES DIVISION
The Services Division comprises Bidfreight, Bidserv and Rennies Financial
Services. The division grew revenue by 11,4% to R18,3 billion (2002: R16,4
billion). Operating income at R750,5 million (2002: R718,6 million) represents a
4,4% increase.
BIDFREIGHT
Bidfreight"s revenue (excluding Bidcorp plc and Namsov) increased by 5,3% to
R13,7 billion (2002: R12,9 billion) and operating income increased by 11,1% to
R395,4 million (2002: R355,9 million).
Bidfreight experienced a year where the strengthening rand/dollar exchange rate
impacted the profitability of the division. Imports into South Africa have
generally shown only a modest response to the strengthening currency whilst
exports to the developed world are becoming less competitive and increasingly
less profitable. We continue to liaise and work closely with Transnet to assist
where possible to convert road traffic back to rail and to find workable
solutions to the bottlenecks in the transport infrastructure, particularly in
the ports. The restructuring of Portnet into the National Ports Authority and
the South African Port Operations is progressing well and the division looks
forward to the start of the anticipated port concessing process. Bidfreight, and
in particular the terminals operations, are well positioned to benefit from
concessions in its fields of expertise.
BIDCORP PLC
The restructuring and weaker markets, particularly in the last six months, have
delayed the turnaround of Bidcorp, but significant progress, at a cost, has been
made. A solid foundation, from which to move forward, has been established.
BIDSERV
Bidserv"s revenue increased by 15,2% to R1,7 billion (2002: R1,5 billion) and
operating income increased by 24,1% to R166,7 million (2002: R134,3 million).
Bidserv operates in the soft services sector of the facilities management
industry and supplies a wide range of services throughout South Africa. A
general move by the market to formal tender processes resulted in tougher
trading conditions, particularly in the latter part of the financial year. The
division"s extensive national footprint, superior service and product quality
resulted in a high percentage of contract wins. Bidserv increased its market
share and improved margins.
RENNIES FINANCIAL SERVICES
Rennies Financial Services" (Renfin) revenue increased by 20,0% to R642,1
million (2002: R534,9 million) and operating income increased by 42,2% to R156,1
million (2002: R109,7 million).
It was a year of mixed fortunes for Renfin. All operations enjoyed more positive
trading conditions in the first half of the year. The second half of the year
was, however, marked by traveller anxieties in the lead up to the Iraqi war,
which turned out to have only a minor impact on travel patterns, and the
outbreak and rapid spread of the SARS virus, which had a devastating effect on
global travel suppliers as much travel was postponed. Rennies Bank showed
excellent growth and its short-term A2 rating was reconfirmed. A long-term BBB
rating was also awarded.
Notwithstanding the strength of the currency, tourist flow to South Africa
continues.
THE FOODSERVICE PRODUCTS DIVISION
The Foodservice Products Division comprises Bidvest plc, Caterplus and Combined
Foods, which are focused on the supply and distribution of foodservice products
to the leisure, hospitality and catering industries. Revenue for this division
grew by 6,8% to R22,6 billion (2002: R21,1 billion). Operating income increased
25,3% to R843,5 million (2002: R672,9 million).
BIDVEST PLC
Bidvest plc"s revenue increased by 5,3% to R19,7 billion (2002: R18,7 billion)
and operating income increased by 23,5% to R569,4 million (2002: R460,9
million).
UNITED KINGDOM
3663 First for Foodservice"s revenue increased by 5,4% to R15,3 billion (2002:
R14,6 billion) and operating income increased by 23,5% to R457,0 million (2002:
R369,7 million).
The acquisition of Swithenbank is a strategically important step to building a
competency platform to distribute fresh product to the foodservice marketplace,
extending the products and services offered.
AUSTRALASIA
Bidvest Australasia"s revenue increased by 4,8% to R4,4 billion (2002: R4,2
billion) and operating income increased by 22,4% to R119,9 million (2002: R97,9
million).
A number of small acquisitions were made, making the division a truly national
foodservice products distributor in Australia and New Zealand. The non-core
operation in Darwin, acquired as part of John Lewis, was sold.
CATERPLUS
Caterplus" revenue increased by 19,2% to R2,0 billion (2002: R1,7 billion) and
operating income increased by 35,7% to R179,8 million (2002: 132,5 million).
In the first half of the financial year the declining exchange rate gave rise to
significant food inflation. At the same time the country experienced a vast
improvement in the numbers of domestic and foreign tourists, which boosted the
resort, hotel and restaurant sectors. In the second half of the period the
strengthening rand saw a sharp decline in food prices.
COMBINED FOODS
Combined Foods" revenue increased by 17,4% to R852,7 million (2002: R726,1
million) and operating income increased by 18,4% to R94,2 million (2002: R79,6
million).
NCP Yeast reported significantly improved results and returns for the year.
Chipkins Bakery Supplies remains profitable and continues to generate pleasing
returns. Crown National attributes its continued success largely to its core of
dedicated, loyal, experienced and committed staff. This commitment has led to a
significant improvement in profitability.
THE COMMERCIAL PRODUCTS DIVISION
The Commercial Products Division comprises Bidoffice, Bidpac and Voltex, which
are focused on the manufacture, trading and distribution of commercial products.
Revenue for the division increased by 37,9% to R7,6 billion (2002: R5,5
billion). Operating income grew 25,8% to R613,3 million (2002: R487,7 million).
BIDOFFICE
Bidoffice"s revenue increased by 35,0% to R4,7 billion (2002: R3,5 billion) and
operating income increased by 25,5% to R393,8 million (2002: R313,7 million).
The Stationery division once again performed above expectation, delivering solid
returns and generating significant cash, despite pressure on the revenue line as
a result of the strengthening rand. The Printing and Related division delivered
an outstanding performance as evidenced by all key indicators. Satisfactory
trading conditions and improved asset management did not yield the anticipated
returns in the Office Automation division due to an increased incidence of bad
debts and a further investment in information technology. Cash generation was,
however, much improved. The Office Furniture division greatly enhanced its
contribution to Bidoffice.
We are pleased with the performance of Lithotech France, which in its early
stages has made a profit.
BIDPAC
Bidpac"s revenue increased by 16,8% to R730,6 million (2002: R625,5 million) and
operating income increased by 22,5% to R103,1 million (2002: R84,1 million).
Bidpac produced pleasing results in a difficult and volatile market. Improved
profitability and excellent asset management resulted in strong, positive cash
flows and a substantial improvement on the return on funds employed.
VOLTEX
Voltex"s revenue increased by 55,0% to R2,1 billion (2002: R1,4 billion) and
operating income increased by 29,6% to R116,4 million (2002: R89,8 million).
Voltex experienced buoyant trading conditions to the end of December 2002 as a
result of the renewed business confidence and the weaker rand, which encouraged
foreign investment and capital expenditure. Government"s commitment to housing
projects gained momentum and further boosted the division"s performance. The
second half of the financial year was a period of consolidation. Cheaper imports
became prevalent and facilitated the re-emergence of smaller wholesalers whose
price-cutting put margins under pressure.
PROSPECTS
Bidvest"s strategic patience, not forcing the pace of acquisitions, has paid off
in that the current difficult trading conditions have created numerous
opportunities.
Our BEE initiative holds enormous potential. We are excited to have been able to
find such an innovative solution, which will result in the empowerment of our
BEE shareholders and staff, economic benefits for suppliers, access to large
tenders and the social upliftment of the communities in which we operate.
Export initiatives are being developed throughout the Group, but the
strengthening rand has slowed these activities.
mymarket.com is an integral part of Bidvest"s technological evolution. We have
responded to and are using technology with thoughtfulness and creativity, to
accelerate momentum rather than create it, driven by a compulsion to turn
unrealised potential into results.
The restructuring of Bidcorp plc and the closure of Safcon is now behind us. We
are hopeful that the underperforming businesses will make a meaningful
contribution in the future.
As an empowered South African business, we are poised at the point of
breakthrough.
Bidvest is proud of its achievements. We have a sound financial base, dedicated
and capable management teams and exciting prospects. Management is budgeting for
real growth.
We look forward with great confidence to participating in a new era in South
African business together with our empowerment partners. We are certain that
Bidvest will grow both organically and acquisitively, maximising opportunities
to make a lasting contribution to this country.
DISTRIBUTION OUT OF SHARE PREMIUM
Notice is hereby given that a distribution out of share premium of 112,0 cents
per share, in lieu of a dividend, has been awarded to members recorded in the
register of the Company at close of business on Friday, September 26 2003.
Shareholders are advised that the last day to trade "CUM" the distribution will
be Thursday, September 18 2003. The shares will trade "EX" distribution as from
Friday, September 19 2003 and the record date will be Friday, September 26
2003. Share certificates may not be dematerialised or rematerialised during the
period Friday, September 19 2003 to Friday, September 26 2003, both days
inclusive. Payment will be made on Monday, September 29 2003.
In terms of the requirements of the Companies Act, the directors confirm that
after the payment of the distribution the Company will be able to pay its debts
as they become due in the ordinary course of business, and its consolidated
assets, fairly valued, will exceed its consolidated liabilities.
In terms of article 56A of the Company"s articles of association, payments
amounting to R10 or less will be aggregated and donated to the Bidvest
Chairman"s Fund Trust, for distribution to charitable institutions.
For and on behalf of the board
B Joffe F Titi
Executive Chairman Deputy Chairman
August 22 2003
THE BIDVEST GROUP LIMITED ("Bidvest" or "the Group")
DIRECTORS
B Joffe (Executive Chairman), F Titi* (Deputy Chairman), IA Berman, MC Berzack,
LG Boyle, LI Chimes, BR Chipkin*, M Chipkin, RW Graham, AM Griffith, CH
Kretzmann, S Koseff*, D Masson*, LK Matisonn*, SP Ngwenya*, P Nyman, JL
Pamensky*, LP Ralphs, TH Reitman* (British), FEA Robarts, DK Rosevear, AC
Salomon (Alternate HL Greenstein), CE Singer, PC Steyn, R Wainer, CE Watt, PD
Womersley. *Non-executive
COMPANY SECRETARY
MA David
TRANSFER SECRETARIES
Computershare Limited, 70 Dmarshall Street Johannesburg 2001, South Africa. PO
Box 1053, Johannesburg 2000, South Africa.
REGISTERED OFFICE
Bidvest House, 18 Crescent Drive, Melrose Arch, Melrose 2196 Johannesburg, South
Africa. PO Box 87274, Houghton 2041, Johannesburg, South Africa.
REGISTRATION NUMBER: 1946/021180/06
ISIN: ZAE000008132
Share code: BVT
URL: www.bidvest.com
Date: 25/08/2003 07:27:21 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department