Wrap Text
Unaudited Interim Results for the six months ended 31 December 2014
SUPER GROUP LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1943/016107/06
Share code SPG
ISIN ZAE000161832
("Super Group" or "the Group" or "the company")
UNAUDITED INTERIM RESULTS
for the six months ended 31 December 2014
FINANCIAL PERFORMANCE AND
HIGHLIGHTS
For the six months ended 31 December 2014
UP 23%
REVENUE
R8,7 BILLION
UP 13%
TRADING PROFIT
R730 MILLION
UP 10%
PROFIT BEFORE TAXATION
R652 MILLION
DOWN 0.9
OPERATING PROFIT MARGIN
8,2%
UP 11%
HEPS
134 CENTS
UP 16%
ADJUSTED HEPS
146 CENTS
UP 34%
CASH GENERATED
FROM OPERATIONS
R1,0 BILLION
UP 7%
NAV PER SHARE
(SINCE 30 JUNE 2014)
1 538 CENTS
INTRODUCTION
Despite the trading environment, specifically in Africa, for the six months ended 31 December 2014 being exceptionally
challenging, Super Group delivered a solid and commendable set of results. The Group's integrated mobility solutions
model, complemented by strategic acquisitions, continues to enhance shareholder value.
The logistics and transport industry in South Africa continues to face challenges with the competitive landscape
escalating and margins continuing to erode in this market. The outsourcing of logistics is slowly gaining momentum, but
it remains tough to win meaningful contracts with competitor price reductions impacting across all sectors. Logistics into
Africa went through a tough six months with exceptionally competitive cross-border rates and other factors discussed
in detail below.
The Australian economy continued to grow and the tender pipeline remains strong in the fleet management market.
Changes to tariffs on imported new and second hand vehicles are unlikely to cause a material decline in new vehicle
prices or trigger mass imports of second hand vehicles. Although the fleet management market remains competitive SG
Fleet is well positioned in the Australian market and gaining traction in the United Kingdom (UK) market.
The Board is pleased to announce that Super Group has been included on the JSE Limited's (JSE) Socially Responsible
Index (SRI) with effect from 27 November 2014 and has been included in the JSE's MidCap Index with effect from 22
December 2014. These achievements reflect the hard work and dedication of the Super Group team over the past five
and a half years.
During the period under review, Super Group concluded various transactions that are explained in more detail in the
Divisional Review section of this document.
FINANCIAL PERFORMANCE
Revenue increased by 22,6% to R8 747 million (December 2013: R7 136 million). The growth in revenue was mainly due
to the good performances by the Supply Chain South Africa businesses, SG Fleet and Dealerships.
Operating profit margin declined to 8,2% (December 2013: 9,1%) as a result of continued competitive and inflationary
pressures, extremely disappointing performances by African Logistics and FleetAfrica; and an impairment charge of
R8,4 million relating to the closure of a business within Supply Chain South Africa, directly attributable to the crippling
impact of the South African steel industry strike during July and August 2014. The consistent focus on cost controls
within each business, operational efficiencies and securing new contracts contributed to an increase of 10,1% in operating
profit to R716,3 million (December 2013: R650,6 million).
The increase in net finance costs by 10,0% to R65 million (December 2013: R59 million) relates to increased net borrowings
position as a result of the Phola Coaches, Allen Ford (UK) and other acquisitions.
Profit before taxation increased by 10,1% to R652 million (December 2013: R592 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 period under review increased by 6,3% to 129,6
cents (December 2013: 121,9 cents) and 11,3% to 134,4 cents (December 2013: 120,7 cents), respectively. Adjusted HEPS
increased by 16,2% to 146,3 cents (December 2013: 125,9 cents) on the basis that the B-BBEE scheme, amortisation of
intangibles and acquisition costs amounting to 11,9 cents per share are excluded from HEPS.
The increase in total assets of 18,7% to R14 441 million (30 June 2014: R12 171 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 16,8% (December 2013: 18,8%) for the period under review. However, normalised RNOA,
after tax and excluding the effects of acquisitions and disposals during the period, is 18,9%.
Super Group's net debt position at 31 December 2014 increased to R798 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 31 December 2014 was
14,6% (30 June 2014: 1,7%). The net asset value per share increased by 7,0% for the period to 1 538 cents at 31 December
2014 (30 June 2014: 1 437 cents). The Group's Statement of Financial Position remains healthy.
Operating cash flow increased by 7,7% for the period to R1 007 million (December 2013: R935 million) with a working
capital inflow of R9 million compared to an outflow of R175 million in the comparable period. The working capital inflow
is attributable to better working capital management at the end of December 2014. Cash generated from operations,
after working capital, increased by 33,7% to R1 016 million (December 2013: R760 million).
During the period under review, the company repurchased 2,514,330 shares, totaling 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.
DIVISIONAL REVIEW
SUPPLY CHAIN
Six months ended Six months ended Year ended
31 December 31 December 30 June
R'000 Change % 2014 2013 2014
Revenue 18,5 4 292 223 3 622 921 7 192 965
South Africa 21,4 3 974 137 3 274 632 6 525 257
African Logistics (8,7) 318 086 348 289 667 708
Operating profit 8,3 302 946 279 679 508 175
South Africa 22,8 289 030 235 373 428 786
African Logistics (68,6) 13 916 44 306 79 389
Operating margin (%) 7,1 7,7 7,1
South Africa 7,3 7,2 6,6
African Logistics 4,4 12,7 11,9
Profit before taxation 5,6 260 841 247 030 436 334
South Africa 20,9 247 956 205 116 360 615
African Logistics (69,3) 12 885 41 914 75 719
Net operating assets 5,0 3 104 420 2 956 852 2 923 174
South Africa 3,2 2 567 656 2 488 039 2 446 482
African Logistics 14,5 536 764 468 813 476 692
The majority of Supply Chain South Africa's businesses delivered a strong performance given the tepid economic climate
and challenges faced over this period. In particular, Super Rent, SG Consumer, SG Convenience and Safika Oosthuizens
delivered more than satisfactory financial performances. Digistics' results were disappointing and down on the prior
comparable period mainly as a result of new customer "start-up" costs, i.e. increased IT, staff and vehicle running costs.
Phola Coaches, a business providing passenger transport solutions for the educational, mining, power generation and
construction industries, acquired effective 1 July 2014, is meeting expectations. As a result of the crippling steel industry
strike during July and further impact in August 2014, SG Logistics was closed resulting in an impairment charge of R8,4
million.
African Logistics reported a disappointing set of results with the business being severely impacted by exceptionally
competitive cross-border rates, a significant over-supply of transport solutions mainly from diversifying South African
operators, border strikes in the Democratic Republic of Congo and the negative impact of the South African steel
industry strike. A foreign exchange gain of R8,1 million (December 2013: R10,6 million) was recorded for the period
under review on the back of a weaker average Rand against the US Dollar.
FLEET SOLUTIONS
Six months ended Six months ended Year ended
31 December 31 December 30 June
R'000 Change % 2014 2013 2014
Revenue 19,5 1 058 513 885 524 1 935 188
FleetAfrica 19,7 233 282 194 930 382 843
SG Fleet 19,5 825 231 690 594 1 552 345
Operating profit 10,0 326 873 297 108 650 366
FleetAfrica (45,9) 44 542 82 304 122 519
SG Fleet 31,4 282 331 214 804 527 847
Operating margin (%) 30,9 33,6 33,6
FleetAfrica 19,1 42,2 32,0
SG Fleet 34,2 31,1 34,0
Profit before taxation 10,8 321 300 289 929 639 796
FleetAfrica (43,1) 50 033 87 950 134 682
SG Fleet 34,3 271 267 201 979 505 114
Net operating assets 19,5 1 441 719 1 206 913 1 255 701
FleetAfrica 67,7 588 442 350 802 351 000
SG Fleet (0,3) 853 277 856 111 904 701
FleetAfrica performed below expectations with operating profit 45,9% lower than the previous interim period, despite
a 19,7% increase in revenue. The large decline in profitability and margin reflects the impact of the loss of the ad hoc
vehicle rental contracts to the City of Johannesburg and the implementation of the Transnet contract at the lower
margins typically associated with long-term contracts. The operating margin declined to 19,1%, which is more reflective
of a sustainable level for this business, excluding the ad hoc vehicle rental contracts.
SG Fleet reported an excellent set of results with strong growth in both revenue and operating profit. The implementation
of major clients is on track with its fleet size increasing to 89 000 vehicles. The stabilisation of the novated lease market
in Australia, following the historic period of Fringe Benefit Tax uncertainty, also positively contributed to the business'
performance. In the UK, the salary-packaged lease product is gaining traction resulting in a strong new business pipeline.
Static and relatively strong residual values were seen over the past six months ended 31 December 2014. The Australian
Dollar against the Rand positively impacted the interim results of Super Group to an amount of R13,8 million (December
2013: R10,5 million).
DEALERSHIPS
Six months ended Six months ended Year ended
31 December 31 December 30 June
R'000 Change % 2014 2013 2014
Revenue 29,1 3 379 461 2 618 378 5 150 402
Operating profit 14,4 80 886 70 718 139 032
Operating margin (%) 2,4 2,7 2,7
Profit before taxation 18,0 68 514 58 058 111 788
Net operating assets 212,2 1 589 279 509 037 877 911
Dealerships reported an exceptional set of results despite challenging market conditions. The NAAMSA dealer market
reported a 2,5% decline in new vehicle sales for the year ended 31 December 2014, while Dealerships new vehicle sales
increased by 1,0% for the period to 31 December 2014. While new vehicle volumes were relatively flat, the division
achieved very strong growth in the after-market, used vehicles and finance and insurance areas of the business. Used
vehicle performance continues to grow (17.3% up on the prior period) 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 2,8% (December 2013: 2,7%), excluding Allen
Ford (UK) results. During the six months ended 31 December 2014, two new dealerships were opened (Hino Trucks at
Super Park and the Mazda dealership split away from Ford, East Rand) and Super Group was appointed as the Suzuki
Midrand dealership.
As a result of the disappointing performance by the GWM South Africa distributorship, acquired effective 1 May 2014,
Super Group took the decision to dispose of 25,0% of its 50,1% interest effective 1 October 2014, to a private equity
group.
Effective 1 December 2014, Super Group acquired 100% of Allen Ford (UK), a franchised motor dealership with more
than 100 years in the UK motor industry, for a consideration of R614 million (funded in Pounds Sterling). Allen Ford is the
second largest independently-owned Ford franchise network in the UK, operating 13 franchised Ford motor dealerships
and two franchised Kia dealerships. The one month trading for Allen Ford (UK) within the Super Group stable, had no
material impact on the results for the six months ended 31 December 2014.
SERVICES
The Services segment includes the Corporate, Insurance and Mauritius operations. The Mauritius and Insurance operations
performed slightly ahead of expectations.
PROSPECTS
Continued modest growth in the South African environment is expected over the short to medium term. Super Group
is of the opinion that the cost impact of the exceptionally high infrastructural costs, labour uncertainty and competitive
trading conditions will pose challenges and opportunities for the Group in its drive for cost-efficiencies.
African Logistics, despite being faced with many challenges, remains strategically positioned to benefit from any
increased activity in sub-Saharan Africa. The business' focus is currently on the improvement of operational efficiencies
and vigorous cost optimisation in an over-traded sub-Saharan environment.
FleetAfrica will continue with the implementation of the Transnet contract. FleetAfrica continues to explore and tender
on new fleet management contract opportunities in an environment where sales cycles are extended. Diversification of
the business' traditional customer base beyond South Africa is being investigated.
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 Division is anticipating difficult trading conditions to continue as consumers remain under pressure,
but is confident that its dealerships are well positioned to continue its good trading performance. On the agenda is the
restoration of GWM South Africa's market share and profitability. The assimilation of the Allen Ford (UK) acquisition and
related opportunities within this operational sphere will be pursued. At year end, Allen Ford (UK) will be reported as a
separate entity.
Super Group's position as an innovative, integrated mobility solutions company is strong and the Group remains
committed to achieving a real increase in earnings.
A decision was taken not to declare a dividend for the six months ended 31 December 2014.The Board remains of the
opinion that Super Group should rather re-invest cash generated in acquisitions or to repurchase shares.
The unaudited condensed consolidated results for the six months ended 31 December 2014 will be available on the
Group's website after 17:00 on Monday, 23 February 2015 and the presentation to the investor community can be viewed
on the Group's website from Tuesday, 24 February 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 www.supergroup.
co.za.
On behalf of the Board
P Vallet P Mountford
Chairman of the company Chief Executive Officer
23 February 2015
Sandton
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The Condensed Consolidated Interim Financial Statements for the six-month period ended 31 December 2014 are
prepared in accordance with International Financial Reporting Standard (IAS 34) Interim Financial Reporting, the
SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as
issued by the Financial Reporting Standards Council and the requirements of the JSE Listings Requirements and the
Companies Act of South Africa. These Condensed Consolidated Interim Financial Statements have not been reviewed
or audited by the Group's auditors.
The accounting policies applied in the preparation of these Condensed Consolidated Interim Financial Statements for
the six-month period ended 31 December 2014, are in terms of International Financial Reporting Standards (IFRS)
and are consistent with those applied in the previous 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 to
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 accounting policies have been amended for the standards mentioned in this
paragraph, but there was no material effect on the prior year results and consequently no restatements have been made.
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.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Six month Six month
period ended period ended Year ended
31 December 31 December 30 June
2014 2013 2014
Unaudited Unaudited Audited
R'000 R'000 R'000
Revenue 8 747 104 7 136 317 14 296 765
Trading profit before depreciation and amortisation 1 045 333 914 899 1 930 195
Depreciation and amortisation (315 506) (269 288) (579 641)
Trading profit 729 827 645 611 1 350 554
Capital items (13 534) 4 999 (6 045)
Operating profit 716 293 650 610 1 344 509
Net finance charges (64 603) (58 706) (102 206)
Profit before taxation 651 690 591 904 1 242 303
Income tax expense (160 853) (147 443) (304 609)
Profit for the period 490 837 444 461 937 694
Profit for the period attributable to:
Non-controlling interests 104 745 89 664 208 524
Equity holders of Super Group 386 092 354 797 729 170
490 837 444 461 937 694
Other comprehensive income
Effect of foreign exchange (36 576) 84 198 161 120
Revaluation of land and buildings – – 23 652
Taxation effect of revaluation of land and buildings – – (5 838)
Other comprehensive income for the period (net of tax) (36 576) 84 198 178 934
Total comprehensive income for the period (net of tax) 454 261 528 659 1 116 628
Total comprehensive income for the period attributable to:
Non-controlling interests 71 002 115 838 274 784
Equity holders of Super Group 383 259 412 821 841 844
454 261 528 659 1 116 628
RECONCILIATION OF HEADLINE EARNINGS
Profit attributable to equity holders of Super Group 386 092 354 797 729 170
Capital items after tax 14 210 (3 542) (1 495)
Headline profit for the period 400 302 351 255 727 675
Earnings per share (cents)
Basic 129,6 121,9 249,2
Diluted 126,7 118,3 241,9
Headline earnings per share (cents)
Basic 134,4 120,7 248,7
Diluted 131,4 117,1 241,4
RECONCILIATION OF ADJUSTED EARNINGS
Headline profit for the period 400 302 351 255 727 675
Acquisition costs after tax 22 046 1 699 5 561
B-BBEE costs after tax 1 628 1 435 6 805
Amortisation of intangible assets arising on business
combinations after tax 11 944 12 040 20 774
Adjusted headline profit for the period 435 920 366 429 760 815
Adjusted headline earnings per share (cents)
Basic 146,3 125,9 260,0
Diluted 143,0 122,2 252,4
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 December 31 December 30 June
2014 2013 2014
Unaudited Unaudited Audited
R'000 R'000 R'000
ASSETS
Non-current assets
Property, plant and equipment 3 084 062 2 799 076 2 865 531
Investment property 120 400 64 716 120 400
Full maintenance lease assets 803 308 579 539 554 728
Intangible assets 228 952 230 498 199 566
Goodwill 2 374 512 1 782 507 1 887 982
Investments and other non-current assets 190 615 33 320 43 650
Deferred tax assets 375 858 322 040 371 597
Current assets 7 263 775 6 103 273 6 127 348
Asset held-for-sale – – 60 000
Inventories 2 055 953 1 017 647 1 367 803
Trade receivables 2 074 514 1 779 805 1 783 680
Sundry receivables 965 124 847 405 858 999
Insurance-related assets 15 176 14 411 16 687
Cash and cash equivalents 2 153 008 2 444 005 2 040 179
Total assets 14 441 482 11 914 969 12 170 802
EQUITY AND LIABILITIES
Capital and reserves
Capital and reserves attributable to equity holders
of Super Group 4 590 626 3 941 258 4 268 796
Non-controlling interests 887 511 838 225 952 693
Total equity 5 478 137 4 779 483 5 221 489
Liabilities
Non-current liabilities
Fund reserves 342 883 299 604 338 948
Non-controlling interest put options and other liabilities 290 069 215 531 222 152
Full maintenance lease liabilities 92 912 101 923 101 009
Interest-bearing borrowings 2 519 427 2 157 034 1 645 247
Provisions 150 881 140 974 155 011
Deferred tax liabilities 249 068 252 044 232 659
Current liabilities 5 318 105 3 968 376 4 254 287
Full maintenance lease liabilities 81 503 87 577 109 735
Interest-bearing borrowings 257 238 338 509 275 238
Trade and other payables1 4 667 257 3 188 740 3 428 209
Insurance-related liabilities 29 315 33 811 37 810
Income tax payable 145 764 68 903 82 550
Provisions1 137 028 250 836 320 745
Total equity and liabilities 14 441 482 11 914 969 12 170 802
1 Leave pay included in:
Trade and other payables 76 552 – –
Provisions – 73 175 77 555
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
Six month Six month
period ended period ended Year ended
31 December 31 December 30 June
2014 2013 2014
Unaudited Unaudited Audited
R'000 R'000 R'000
Cash flows from operating activities
Operating cash flow 1 007 217 934 976 2 004 716
Working capital inflow/(outflow) 8 941 (174 762) (90 175)
Cash generated from operations 1 016 158 760 214 1 914 541
Finance costs paid (120 324) (103 168) (222 400)
Investment income and interest received 54 424 47 682 123 954
Income tax paid (105 831) (157 611) (293 200)
Dividend paid to non-controlling interest (56 992) (30 808) (255 588)
Net cash generated from operating activities 787 435 516 309 1 267 307
Cash flows from investing activities
Net additions to plant and equipment (225 514) (339 834) (650 805)
Net additions to land, buildings and leasehold improvements (91 779) (88 872) (114 206)
Net additions to full maintenance lease assets (340 910) (16 920) (68 789)
Net additions to intangible assets (17 107) (15 639) (21 535)
Proceeds on disposal of assets held-for-sale – 6 100 6 100
Net acquisition of businesses (Net of cash acquired) (695 799) (3 545) (18 147)
Additional investment in existing subsidiary (26 437) – (334 639)
Other investing activities (566) (98 253) (85 097)
Net cash outflow from investing activities (1 398 112) (556 963) (1 287 118)
Cash flows from financing activities
Net share repurchases (72 451) (53 273) (64 338)
Net interest-bearing borrowings raised 858 468 585 534 110 070
Net full maintenance lease borrowings (repaid)/raised (33 599) 37 490 52 510
Net cash inflow from financing activities 752 418 569 751 98 242
Net increase in cash and cash equivalents 141 741 529 097 78 431
Net cash and cash equivalents at beginning of the period 2 040 179 1 872 545 1 872 545
Effect of foreign exchange on cash and cash equivalents (28 912) 42 363 89 203
Cash and cash equivalents at end of the period 2 153 008 2 444 005 2 040 179
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Non-
Share Share Other Retained buyback controlling Total
capital premium reserves earnings reserve Total interest equity
R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000
Balance at 30 June 2013 – Audited 315 334 1 746 798 713 234 1 447 226 (690 196) 3 532 396 751 917 4 284 313
Other comprehensive income – – 58 024 – – 58 024 26 174 84 198
Translation adjustment – – 58 024 – – 58 024 26 174 84 198
Profit for the period – – – 354 797 – 354 797 89 664 444 461
Total comprehensive income for the period – – 58 024 354 797 – 412 821 115 838 528 659
Realisation of revaluation reserve through
depreciation – – (50) 50 – – – –
Share-based payment reserve movement – – – 8 727 – 8 727 426 9 153
Dividends paid – – – – – – (30 808) (30 808)
South African share options exercised – – – (102 520) – (102 520) (180) (102 700)
Share buybacks – – – – 49 427 49 427 – 49 427
Deferred tax recorded directly in equity on
movement in options – – – 46 599 – 46 599 1 032 47 631
Non-controlling interest put options – – – (6 192) – (6 192) – (6 192)
Balance at 31 December 2013 – Unaudited 315 334 1 746 798 771 208 1 748 687 (640 769) 3 941 258 838 225 4 779 483
Other comprehensive income – – 54 650 – – 54 650 40 086 94 736
Translation adjustment – – 36 836 – – 36 836 40 086 76 922
Revaluation of land and buildings – – 23 652 – – 23 652 – 23 652
Taxation effect of revaluation of land and
buildings – – (5 838) – – (5 838) – (5 838)
Profit for the period – – – 374 373 – 374 373 118 860 493 233
Total comprehensive income for the period – – 54 650 374 373 – 429 023 158 946 587 969
Realisation of revaluation reserve through
depreciation – – (1 086) 1 086 – – – –
Realisation of revaluation reserve through
sale of revalued properties – – (13 031) 13 031 – – – –
Share-based payment reserve movement – – – 9 878 – 9 878 1 357 11 235
South African share options exercised – – – (99 483) – (99 483) – (99 483)
South African B-BBEE good leaver1 options
exercised – – – (1 936) – (1 936) (9) (1 945)
Share buybacks – – – 150 363 150 363 – 150 363
Dividends paid – – – – – – (224 780) (224 780)
Deferred tax recorded directly in equity on
movement in options – – – 47 077 – 47 077 716 47 793
Non-controlling interest put options
movement – – – 34 224 – 34 224 – 34 224
Transactions with equity partners – – – (96 576) – (96 576) 209 030 112 454
Australia share options exercised – – – (116 880) – (116 880) (116 413) (233 293)
Australian initial public offering transaction
costs – – – (28 152) – (28 152) (28 039) (56 191)
NCI recognised in respect of subsidiaries
acquired – – – – – – 113 660 113 660
Balance at 30 June 2014 – Audited 315 334 1 746 798 811 741 1 885 329 (490 406) 4 268 796 952 693 5 221 489
Other comprehensive income – – (2 833) – – (2 833) (33 743) (36 576)
Translation adjustment – – (2 833) – – (2 833) (33 743) (36 576)
Profit for the period – – – 386 092 – 386 092 104 745 490 837
Total comprehensive income for the period – – (2 833) 386 092 – 383 259 71 002 454 261
Realisation of revaluation reserve through
depreciation – – (66) 66 – – – –
Share-based payment reserve movement – – – 12 377 – 12 377 1 553 13 930
South African share options exercised – – – (117 955) – (117 955) (228) (118 183)
South African B-BBEE good leaver options
exercised – – – (1 481) – (1 481) – (1 481)
Share buybacks – – – – 47 411 47 411 – 47 411
Dividends paid – – – – – – (56 992) (56 992)
Deferred tax recorded directly in equity on
movement in options – – – 20 856 – 20 856 660 21 516
Non-controlling interest put options
movement – – – (4 919) – (4 919) – (4 919)
Transactions with equity partners – – – (17 718) – (17 718) (8 719) (26 437)
Acquisition of businesses – – – – – – 19 308 19 308
Disposal of business – – – – – – (91 766) (91 766)
Balance at 31 December 2014 – Unaudited 315 334 1 746 798 808 842 2 162 647 (442 995) 4 590 626 887 511 5 478 137
1 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.
OPERATING SEGMENTS
Services and inter-company
Supergroup Supply Chain Supply Chain South Africa African Logistics Fleet Solutions FleetAfrica SG Fleet Dealerships
eliminations
Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month Six month
period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended period ended
31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December
2014 2013 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Revenue 8 747 104 7 136 317 4 292 223 3 622 921 3 974 137 3 274 632 318 086 348 289 1 058 513 885 524 233 282 194 930 825 231 690 594 3 379 461 2 618 378 16 907 9 494
Depreciation and
amortisation (315 506) (269 288) (215 218) (186 045) (193 163) (167 579) (22 055) (18 466) (86 168) (71 161) (53 291) (35 269) (32 877) (35 892) (8 531) (6 446) (5 589) (5 636)
Net operating
expenditure – excluding
capital items (7 701 771) (6 221 418) (3 770 776) (3 160 822) (3 489 162) (2 874 013) (281 614) (286 809) (645 472) (517 470) (135 449) (77 357) (510 023) (440 113) (3 291 847) (2 541 216) 6 324 (1 910)
Trading profit 729 827 645 611 306 229 276 054 291 812 233 040 14 417 43 014 326 873 296 893 44 542 82 304 282 331 214 589 79 083 70 716 17 642 1 948
Capital items (13 534) 4 999 (3 283) 3 625 (2 782) 2 333 (501) 1 292 – 215 – – – 215 1 803 2 (12 054) 1 157
Operating profit 716 293 650 610 302 946 279 679 289 030 235 373 13 916 44 306 326 873 297 108 44 542 82 304 282 331 214 804 80 886 70 718 5 588 3 105
Net finance costs and
share of profit in equity –
accounted investee (64 603) (58 706) (42 105) (32 649) (41 074) (30 257) (1 031) (2 392) (5 573) (7 179) 5 491 5 646 (11 064) (12 825) (12 372) (12 660) (4 553) (6 218)
Profit before tax 651 690 591 904 260 841 247 030 247 956 205 116 12 885 41 914 321 300 289 929 50 033 87 950 271 267 201 979 68 514 58 058 1 035 (3 113)
Services & inter-company
Supergroup Supply Chain Supply Chain South Africa African Logistics Fleet Solutions FleetAfrica SG Fleet Dealerships
eliminations
As at As at As at As at As at As at As at As at As at As at As at As at As at As at As at As at As at As at
31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014 31 December 2014 30 June 2014
Unaudited Audited Unaudited Audited Unaudited Audited Unaudited Audited Unaudited Audited Unaudited Audited Unaudited Audited Unaudited Audited Unaudited Audited
R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000
ASSETS
Non-current assets
Property, plant and
equipment 3 084 062 2 865 531 2 043 412 1 927 450 1 667 396 1 594 716 376 016 332 734 11 634 12 489 586 469 11 048 12 020 305 712 225 785 723 304 699 807
Investment property 120 400 120 400 – – – – – – – – – – – – – – 120 400 120 400
Full maintenance lease
assets 803 308 554 728 – – – – – – 803 308 554 728 668 083 397 210 135 225 157 518 – – – –
Intangible assets 228 952 199 566 172 275 144 596 172 275 144 596 – – 48 340 49 149 – – 48 340 49 149 149 499 8 188 5 322
Goodwill 2 374 512 1 887 982 515 501 443 598 463 042 395 320 52 459 48 278 1 265 790 1 338 774 87 822 87 822 1 177 968 1 250 952 593 221 105 610 – –
Investments and other
non-current assets 190 615 43 650 9 424 5 208 9 424 5 208 – – – – – – – – – 3 992 181 191 34 450
Current
Assets held-for-sale – 60 000 – – – – – – – – – – – – – – – 60 000
Inventories 2 055 953 1 367 803 447 820 324 313 411 290 290 317 36 530 33 996 70 188 47 212 2 008 689 68 180 46 523 1 537 945 996 278 – –
Trade receivables 2 074 514 1 783 680 1 380 819 1 115 664 1 254 400 1 011 646 126 419 104 018 409 945 434 660 119 905 86 754 290 040 347 906 278 598 218 162 5 152 15 194
Sundry receivables 965 124 858 999 575 224 531 099 552 051 507 776 23 173 23 323 82 854 86 752 16 230 16 697 66 624 70 055 27 476 19 877 279 570 221 271
Insurance – related assets 15 176 16 687 – – – – – – – – – – – – – – 15 176 16 687
Intercompany trade
receivables – – 18 348 10 341 17 541 9 607 807 734 – 289 – 289 – – 804 557 (19 152) (11 187)
SEGMENT ASSETS 11 912 616 9 759 026 5 162 823 4 502 269 4 547 419 3 959 186 615 404 543 083 2 692 059 2 524 053 894 634 589 930 1 797 425 1 934 123 2 743 905 1 570 760 1 313 829 1 161 944
LIABILITIES
Non-current liabilities
Long-term borrowings 2 612 339 1 746 256 551 881 491 776 551 881 491 776 – – 397 158 424 156 61 641 67 044 335 517 357 112 428 058 – 1 235 242 830 324
Non-controlling interest
put options and other
liabilities 290 069 222 152 266 622 222 152 266 622 222 152 – – – – – – – – – – 23 447 –
Fund reserves 342 883 338 948 – – – – – – 342 883 338 948 48 935 42 912 293 948 296 036 – – – –
Long-term provisions 150 881 155 011 2 717 – 2 717 – – – 138 730 145 576 – – 138 730 145 576 – – 9 434 9 435
Current liabilities – –
Short-term borrowings 338 741 384 973 246 829 255 215 246 829 255 215 – – 81 503 119 988 35 912 41 053 45 591 78 935 – – 10 409 9 770
Trade and other payables
and provisions 4 804 285 3 748 954 1 917 417 1 549 747 1 843 865 1 488 443 73 552 61 304 677 579 679 791 167 195 93 524 510 384 586 267 2 015 471 1 295 370 193 818 224 046
Insurance – related
liabilities 29 315 37 810 – – – – – – – – – – – – – – 29 315 37 810
Intercompany trade
payables – – 46 466 24 140 41 378 19 053 5 088 5 087 11 001 4 039 11 001 4 039 – – 1 759 6 (59 226) (28 185)
SEGMENT LIABILITIES 8 568 513 6 634 104 3 031 932 2 543 030 2 953 292 2 476 639 78 640 66 391 1 648 854 1 712 498 324 684 248 572 1 324 170 1 463 926 2 445 288 1 295 376 1 442 439 1 083 200
Net capex 675 310 855 335 233 154 639 847 195 648 600 303 37 506 39 544 348 638 97 376 331 117 44 986 17 521 52 390 63 003 11 758 30 515 106 354
Net operating assets 6 998 885 5 825 949 3 104 420 2 923 174 2 567 656 2 446 482 536 764 476 692 1 441 719 1 255 701 588 442 351 000 853 277 904 701 1 589 279 877 911 863 467 769 163
BUSINESS COMBINATIONS
Purchase
consideration
Date Interest transferred/
Subsidiaries and businesses Nature of Operating acquired/ acquired/ (received)
acquired/disposed business segment disposed (disposed) (%) R'000
GWM (S.A.) Proprietary Limited Distributorship Dealerships 1 October 2014 (25) (15 000)
(GWM)
Phola Coaches Proprietary Logistics Supply Chain - 1 July 2014 75 110 744
Limited (Phola) South Africa
Volvo and Land Rover Dealerships Dealerships 25 August 2014 100 60 211
Dealerships
Allen Ford (UK) Limited Dealerships Dealerships 1 December 2014 100 614 490
(Allen Ford)
Other acquisitions Logistics Supply Chain - 1 July 2014 and 100 24 459
South Africa 1 December 2014
Total purchase consideration 794 904
Volvo and
Fair value of assets acquired and Land Rover Other
liabilities assumed GWM Phola dealerships Allen Ford acquisitions Total
at date of acquisition/disposal: R'000 R'000 R'000 R'000 R'000 R'000
Assets
Property, plant and equipment (12 561) 46 189 1 622 34 475 11 532 81 257
Intangible assets – 43 443 – – – 43 443
Goodwill (2 959) 52 820 43 378 450 433 14 901 558 573
Equity accounted investee (3 992) – – – – (3 992)
Non-current receivable – 3 678 – – – 3 678
Deferred tax asset (20 925) – – 2 319 – (18 606)
Inventories (250 665) 4 601 37 748 769 529 9 067 570 280
Trade and other receivables (116 223) 18 885 – 200 906 22 730 126 298
Taxation receivable (6) – – – – (6)
Cash and cash equivalents (59 279) 2 916 – 154 583 885 99 105
(466 610) 172 532 82 748 1 612 245 59 115 1 460 030
Liabilities
Interest-bearing borrowings – 11 773 – – – 11 773
Trade and other payables (241 957) 13 405 22 392 984 457 34 656 812 953
Income tax payable – 4 083 – 10 399 – 14 482
Provisions (37 794) 1 557 145 2 899 – (33 193)
Deferred tax liabilities – 11 662 – – – 11 662
(279 751) 42 480 22 537 997 755 34 656 817 677
Acquirees' carrying amount at
(disposal)/acquisition (186 859) 130 052 60 211 614 490 24 459 642 353
Less: Non-controlling interest 91 766 (19 308) – – – 72 458
Loss on sale of subsidiary 12 053 – – 12 053
Deferred contingent consideration 21 137 – – – 21 137
Investment in equity-accounted
investee recognised 46 903 – – – – 46 903
Purchase consideration
(received)/transferred (15 000) 110 744 60 211 614 490 24 459 794 904
Cash disposed/(acquired) 59 279 (2 916) – (154 583) (885) (99 105)
Cash outflow 44 279 107 828 60 211 459 907 23 574 695 799
A 25% shareholding in GWM has been sold effective 1 October 2014. The Group has retained a 25,1% shareholding in
GWM and which 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 R43.4 million in respect of trade name, customer relationships and
contracts.
The acquisition of the Volvo and Land Rover dealerships allows the Group to bolster the Dealerships division. The
acquisition of Allen Ford positions the Group to expand the Dealerships division into the United Kingdom.
The other acquisitions enable the Group to bolster the Supply Chain South Africa division.
The purchase price allocation exercise has not been finalised on certain acquisitions. The Group has 12 months from
acquisition date to finalise this exercise and recognise any intangible assets identified.
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, Volvo and Land Rover dealership, Allen Ford and the other
acquisitions amounting to R52.8 million, R43.4 million, R450.4 million and R14.9 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 R22.1 million relating to these acquisitions are included in the consolidated statement
of comprehensive income.
Volvo and
Land Rover Other
Impact of the acquisitions on the Phola Dealerships Allen Ford Acquisitions Total
results of the Group R'000 R'000 R'000 R'000 R'000
From the dates of acquisition, the acquired
businesses contributed:
Revenue 93 580 107 955 313 993 39 848 555 376
Attributable profit/(loss) to equity holders of
Super Group1 5 232 2 087 (6 172) (180) 967
1 Profit after tax, after non-controlling interest.
Total
Net costs on increase in existing shareholding in subsidiaries: R'000
Non-controlling interest 8 719
Effect of transactions between equity partners on equity 17 718
Cash outflow 26 437
During the year the Group purchased an additional 0,61% shareholding in SG Fleet for R26.4 million, bringing the total
shareholding to 53,15% at 31 December 2014.
SALIENT FEATURES
Six month Six month
period ended period ended Year ended
31 December 31 December 30 June
2014 2013 2014
Unaudited Unaudited Audited
R'000 R'000 R'000
1. Interest-bearing borrowings
SG Fleet interest-bearing borrowings 304 245 399 262 333 399
Asset-based finance 982 953 1 027 445 925 811
Corporate bond 476 554 476 554 477 060
Acquisition borrowings 428 058 – –
Property and other borrowings 584 855 592 282 184 215
2 776 665 2 495 543 1 920 485
2. Share statistics
Total issued less treasury shares ('000) 298 580 291 580 297 039
Weighted number of shares ('000) 297 872 291 006 292 565
Diluted weighted number of shares ('000) 304 750 299 972 301 422
Net asset value per share (cents) 1 537,5 1 351,7 1 437,1
3. Capital commitments
Authorised but not yet contracted for capital
commitments, excluding full maintenance lease assets 422 132 350 865 562 135
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 arm's length
basis with related parties.
5. Subsequent events
Other than the matters disclosed, the directors are not
aware of any matter or circumstance arising subsequent to
the balance sheet date up to the date of this report, which
will affect these results.
CORPORATE INFORMATION
Directors:
Executive: P Mountford (Chief Executive Officer) and C Brown (Chief Financial Officer)
Non-Executive: P Vallet (Chairman of the company), N Davies*, J Newbury*, V Chitalu*#, D Rose* and Dr E Banda*
*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 10272-2050
Email: DB@amstock.com
Shareholder Service (toll-free) Tel: (866) 706-0509
Shareholder Service (international) Tel: (718) 921-8124
www.amstock.com
www.supergroup.co.za
Date: 23/02/2015 04:35:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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