Automotive and Logistics Martin Laubscher CEO Barloworld Automotive and Logistics 25 March 2013
Automotive and Logistics Division overview
Automotive and Logistics Division
Customers Barloworld Automotive (Automotive Business model)
Motor Retail Southern Africa
Car Rental
Fleet Services
Digital Disposal Solutions
Motor Retail Australia
Barloworld Logistics
Supply Chain Mangmt
Freight Mangmt and Services
Supply Chain Software
Transport Solutions
Communication, HR, IT, Legal, Finance, Sustainable Development, Strategy, Empowerment and Transformation, Risk Management, Business Development and Sales, Governance, Ethics and Compliance
• Inter-business unit synergies and cost efficiencies • Apply Collective Wisdom
• Leveraging Automotive infrastructure to achieve critical mass for growth • Retain strategic focus on each business unit
2
Automotive and Logistics Division overview Sense of Scale General Information Employees
10 611
Countries
16
Automotive Principals
Avis; BMW; Chrysler/Fiat; Daimler; Ford; General Motors; Mazda; Toyota; Volkswagen
Car Rental locations
>190
Wholly owned Motor Retail dealerships (SnA & Oz) Key Indicators
40 FY Sep 2011
FY Sep 2012
Rental Days
5.14m
5.71m
New & Used retail units sold
85 092
88 467
195 788
227 019
71
76
Total vehicles under management New vehicles sold per dealership per month DTS km’s travelled FY 12
44.3m
SAT tons shipped FY 12
15.575t
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Automotive and Logistics Division overview • Strong overall result in a competitive trading environment • Revenue: R29.5bn (FY’11: R26.4bn) – up 12% • Record operating profit R1 152m (FY’11: R911m) – up 26% • Operating margin for the year 3.9% (FY’11: 3.4%)
Operating profit (Rm) Car Rental
Margin 7.1% 6.6%
+14%
Motor Retail
2.4% 2.1%
+26%
Fleet Services
15.2% 16.0%
+23%
2.2% 0.8%
+170%
Logistics -
100
200
Sep 2012
300
400
500
600
Sep 2011
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Automotive and Logistics Division overview • Enhance return on equity • Continued cash focus • Targeted capital allocation • Growing market share • Optimising vehicle fleets (utilisation) • Managing working capital levels • Improving asset turn • Expense management
Automotive and Logistics Division overview Corporate activity • Secured Lesotho government contract extension in Avis Fleet Services (AFS) • AFS secured City of Johannesburg outsourced fleet management contract for 5 years • Acquired a minority interest in re – environmental solutions and waste management business • Acquired a 50.1% share in Manline and formed Barloworld Transport Solutions
Emphasis on driving profitable growth and enhancing financial returns
6
Motor Retail Chris Wierenga (Roland Egger) Exec: Strategy (CE Motor Retail)
Automotive and Logistics Division overview Motor Retail
• Fewer, Bigger, Better” Strategy continues - 81 new vehicles sold per dealership per month (Sep’12: 76) - Appropriate dealership footprint • Southern Africa - Focused brand strategy aligned to overall Automotive business model - Improved operating margin through cost containment and margin expansion - Continued strong finance and insurance contribution • Australia - Portfolio performing well Leading Indicators SA - Jan'13 YTD
AUS - Jan'13 YTD
% Growth
30 20 10 New Units
Service Hours
Parts Revenue
F & I Net Profit
8
Automotive and Logistics Division overview Total South African Vehicle Market 900 800 700 600 500
400 300 200 100 0 2007
2008
2009
2010
2011 Passenger
2012 LCV
2013F
2014F
2015F
2016F
2017F
M&HCV
Source: Econometrix
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Automotive and Logistics Division overview Motor retail • Target operating margin and returns • Continue to review brands and business mix in line with changing customer needs
• Entrench “be the Best” culture • Continuous improvement and innovation of our vehicle disposal solutions
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Car Rental Keith Rankin CE Car Rental
Automotive and Logistics Division overview Car Rental
• Improved rental days despite prior year Census impact • Static revenue per day in a competitive environment impacted by higher replacement volumes (hail storm) • Continued focus on operating costs • Fleet utilisation impacted by hail damage • Continued solid used vehicle profit contribution • Coach charter integration progressing slowly
• Sustained customer satisfaction above 90% Leading Indicators Jan '13YTD
% Growth
15
Sep '12 YTD
10 5
0 -5 Rental Days
Rate Per Day
Fleet Utilisation
Fleet Size
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Automotive and Logistics Division overview Car rental • AvisBudget Group • Retain market leadership • Focus on improving quality of the business: - Yield, fleet planning, acquisition, mix, utilisation, distribution and disposal • Environmentally responsible corporate • CSI >90%
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Fleet Services Clive Else CE Avis Fleet Services
Automotive and Logistics Division overview Fleet Services
• Pleasing performance in low interest rate environment • Strong financed fleet growth supported by Phakisaworld acquisition – effective January 2012 • Strong growth in fleets under maintenance • Good used vehicle profits despite lower margins • Intelligent Fuel Management enhances overall product offering • Secured and renewed significant contracts Leading Indicators Jan '13 YTD
% Growth
30
Sep '12 YTD
20 10 0 Maintenance Fleet
Finance Fleet
Total Fleet
15
Logistics Steve Ford CE Barloworld Logistics
Automotive and Logistics Division overview Logistics
Good turnaround and positioned for growth • Southern Africa - Ellerines supply chain contract now fully operational - Higher volumes through Barloworld Equipment
- Recent corporate activity positions business for growth • Europe, Middle East and Asia - Rationalisation and cost control taking effect, stabilising volumes in sea-air market
- Appointed new local management in Spain and Far East, however difficult trading conditions persist - Progressing supply chain management activities in Dubai
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Automotive and Logistics Division overview Logistics • Build a significant integrated logistics business • Organic growth through focused business development team • Targeted acquisitive growth • Settle recent acquisitions
