2014 AGENDA 02 OVERVIEW 06 REVIEW 22 REVIEW 37 39 GROUP - PowerPoint PPT Presentation

AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 2014

AGENDA 02 OVERVIEW 06 REVIEW 22 REVIEW 37 39 GROUP FINANCIAL OUTLOOK QUESTIONS DIVISIONAL 1 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

GROUP OVERVIEW 02

GROUP OVERVIEW GROUP STRUCTURE INDUSTRIAL FLEET MANAGEMENT CONTRACT MINING EQUIPMENT AND LOGISTICS AND PLANT RENTAL DISTRIBUTION, LEASING RENTAL VALUE-ADDED CORPORATE OPENCAST MINING VALUE-ADDED SERVICES FOR: LEASING AND LOGISTICS FOR: SERVICES: Forklifts Passenger vehicles Drilling Mobile cranes Light, medium and heavy Blasting commercial vehicles Port equipment Load and haul Construction and mining equipment Mining trucks Short-term plant rental Vehicle remarketing Other industrial equipment Logistics 3 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

GROUP OVERVIEW SALIENT FEATURES REVENUE OPERATING PROFIT 9.8% 9.6% R9 089 million to R9 978 million R1 038 million to R938 million CASH GENERATED by operations INTEREST-BEARING before changes in working capital borrowings 3.4% 5.0% R2 867 million to R2 965 million R7 597 million to R7 976 million HEADLINE EARNINGS per share REVENUE-GENERATING assets 26.3% 4.8% 104.0 cents to 76.7 cents R9 578 million to R10 034 million 4 4 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

GROUP OVERVIEW MOVING VALUE SALIENT FEATURES continued Results negatively impacted by once off items: In Contract Mining and Plant Rental; and › Impairment of Protech investment › Fleet Management and Logistics and Industrial Equipment divisions demonstrated resilience by recording an increase in revenue, operating margins and profitability Ongoing investments in revenue-generating assets translating into higher annuity income and cash flows Rest of Africa and UK increased their operating profit contribution Continue to balance exposure to Contract Mining No dividend declared: Position the group for future growth in Fleet Management and › Logistics and Industrial Equipment Will revert to stated dividend policy in near term › Global commodity demand under pressure which is impacting Contract Mining and Plant Rental 5 5 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

FINANCIAL REVIEW 06

FINANCIAL REVIEW REVENUE OVERVIEW GROUP REVENUE* R9 978 million (2013: R9 089 million) 2014 3 037 +12.1% Higher revenue from outright INDUSTRIAL sales in UK 2013 2 708 EQUIPMENT 2014 2 796 +18.4% Increase in leasing revenue FLEET MANAGEMENT and used vehicle remarketing 2013 2 362 AND LOGISTICS +6.9% 2014 4 515 Increase due to a contract CONTRACT MINING changing to wet rate and FX 2013 4 223 AND PLANT RENTAL impact on Benga revenue * Excludes inter-company revenue of R370 million (2013: R204 million) 7 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

FINANCIAL REVIEW VALUE CHAIN REVENUE STATEMENT 2014 R’ MILLION Distribute Lease/rent Value-add Sell Total Industrial Equipment 1 220 923 712 182 3 037 Fleet Management and Logistics - 1 212 930 654 2 796 Contract Mining and Plant Rental - 399 4 033 83 4 515 Total 1 220 2 534 5 675 919 10 348 2013 Industrial Equipment 1 051 740 744 173 2 708 Fleet Management and Logistics - 1 094 825 443 2 362 Contract Mining and Plant Rental - 509 3 602 112 4 223 Total 1 051 2 343 5 171 728 9 293 Industrial Equipment value-add revenue decreased as a result of customers delaying services on their owned fork trucks Contract Mining and Plant Rental revenue from leasing/rent decreased on the back of a slowdown of rentals into the mining sector 8 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

FINANCIAL REVIEW VALUE CHAIN REVENUE STATEMENT 2014 2013 8% 9% 11% 12% 25% 24% 55% 56% Distribute Rent/lease Value-add Sell 9 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014

FINANCIAL REVIEW GROUP INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2014 R’ MILLION 2014 2013 % ch Revenue 9 978 9 089 +9.8% Net operating expenses (6 974) (6 219) +12.1% Profit from operations 3 004 2 870 +4.7% Depreciation, amortisation and recoupments (2 066) (1 832) +12.8% Operating profit 938 1 038 (9.6%) Net foreign exchange (losses)gains (1) 7 Impairment of leasing assets (2) (16) Protech impairment (63) - Profit before net finance costs 872 1 029 +15.3% Net finance costs (603) (543) +11.0% Profit before taxation 269 486 (44.7%) EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 10

FINANCIAL REVIEW GROUP INCOME STATEMENT (cont) FOR THE YEAR ENDED 30 JUNE 2014 R’ MILLION 2014 2013 % ch Profit before taxation 269 486 (44.7%) Income tax expense (18) (78) (76.9%) Profit for the year 251 408 (38.5%) RECONCILIATION OF TAXATION RATE (%) 2014 2013 Standard taxation rate 28.0 28.0 Foreign tax incentive (14.1) (6.0) Deferred tax asset recognition (5.1) (4.2) Other taxation adjustments (2.1) 1.1 Effective taxation rate 6.7 18.9 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 11

FINANCIAL REVIEW WEIGHTED AVERAGE SHARES IN ISSUE MILLIONS 2014 2013 Weighted average shares in issue, net of treasury shares 394.2 411.4 Weighted share buy back (8.5) Weighted treasury shares sold for staff scheme 2.1 Weighted average shares in issue 396.3 402.9 Basic and diluted HEPS (cents) 76.7 104.0 Basic and diluted EPS (cents) 60.6 100.0 Lereko Mobility Proprietary Limited has an option to buy 5.8 million shares at the 20 day VWAP as at 4 June 2015, alternatively Eqstra will repurchase and cancel the shares at 0.1 cents per share EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 12

FINANCIAL REVIEW BALANCE SHEET - ASSETS R’ MILLION 2014 2013 % ch Revenue-generating assets 10 034 9 578 +4.8% Inventories 1 117 945 +18.2% Trade and other receivables 1 704 1 576 +8.1% Cash and cash equivalents 93 300 (69.0%) Other assets 928 902 +2.9% Total assets 13 876 13 301 +4.3% 2014 2013 8% 6% OPERATING ASSETS 14% 15% South Africa Rest of Africa UK 77% 80% EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 13

FINANCIAL REVIEW BALANCE SHEET - EQUITY AND LIABILITIES R’ MILLION 2014 2013 % ch Total equity 3 451 3 275 +5.4% Interest-bearing borrowings 7 976 7 597 +5.0% Accounts payables and provisions 1 664 1 654 +0.6% Other liabilities 785 775 +1.3% Total equity and liabilities 13 876 13 301 +4.3% 12 000 10 000 8 000 6 000 4 000 2 000 0 2009 2010 2011 2012 2013 2014 Revenue-generating assets Interest-bearing borrowings EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 14

FINANCIAL REVIEW CASH FLOW STATEMENT R’ MILLION 2014 2013 % ch Cash generated from operations before working 2 965 2 867 +3.4% capital movements Working capital movements* 457 292 +56.5% Cash generated from operations 3 422 3 159 +8.3% Cash flows from interest and taxation (630) (614) +2.6% Net cash flows from operating activities 2 792 2 545 +9.7% Net cash flows from investing activities (3 117) (2 821) +10.5% Net cash flows from financing activities 113 (44) Net decrease in cash and cash equivalents before (212) (320) (33.8%) effect of exchange rate * Includes R681 million (2013:R509 million) of leasing assets transferred to inventory as a non cash flow item EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 15

FINANCIAL REVIEW MOVEMENT IN CASH AND CASH EQUIVALENTS At beginning of the year 300 Cash generated from operations 2 965 Increase in interest-bearing borrowings 263 Movement in finance lease receivables 44 Increase in working capital 224 * Taxation paid 27 Net finance costs and fx movements 598 Net capital expenditure 2 449 * Transactions with shareholders 150 Business acquisitions and investments 31 At the end of the year 93 * Changes in working capital and net capital expenditure have been adjusted for the leasing assets that were transferred to inventory as a non cash flow item EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 16

FINANCIAL REVIEW CAPITAL EXPENDITURE R’ MILLION 2014 2013 EXPANSION 1 045 1 199 Industrial Equipment 667 565 Fleet Management and Logistics 378 539 Contract Mining and Plant Rental - 95 REPLACEMENT (NET OF PROCEEDS) 2 085 1 636 Industrial Equipment 189 285 Fleet Management and Logistics 1 144 744 Contract Mining and Plant Rental 752 607 TRANSFER TO INVENTORIES (681) (509) Net capital expenditure 2 449 2 326 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 17

FINANCIAL REVIEW FUNDING POSITION FUNDING FACILITIES (R’ MILLION) Facility size Utilised Unutilised RSA bank debt General banking facility 900 101 799 Liquidity facility 1 000 1 000 Term facility 2 628 2 628 ECE backed debt US Ex-Im and Coface 216 216 Call facility Asset manager 50 50 Total 4 794 2 995 1 799 RSA non-bank debt Bond Maturity date 3 419 CP Various 823 EQS01 18 Nov 2014 270 EQS02 22 Sep 2015 50 EQS04 01 Jul 2015 411 EQS09 28 Nov 2016 100 EQS05 25 Apr 2017 900 EQS06 09 Apr 2018 340 EQS07 09 Apr 2018 106 EQS08A 04 Oct 2018 Amortising 419 Total SA funding 6 414 Rest of world 1 720 1 488 232 Total funding 7 902 EQSTRA AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2014 18