Barloworld Limited - Merrill Lynch Conference Sun City 12-13 March 2013 Our values live on ...
Welcome to Barloworld Barloworld “Our values live on…” Barloworld is a focused multinational industrial corporation with annual revenues exceeding R58 billion. An aligned strategic approach directs our operations in delivering integrated customer solutions, meeting exacting performance standards and creating sustainable value for all stakeholders. What we do • Barloworld offers its global customer base fmexible, value-adding, integrated business solutions backed by leading international brands through its core divisions: Equipment – earthmoving and power systems Automotive and Logistics – car rental, motor retail, fmeet services, used vehicles and disposal solutions, logistics management and supply chain optimisation Handling – forklift truck distribution, agricultural equipment and cost-effective wheel loaders The brands we represent on behalf of our principals include Caterpillar, Hyster, Avis, Audi, BMW, Ford, General Motors, Mazda, Mercedes-Benz, Toyota, Volkswagen, Massey Ferguson and others. Corporate Barloworld Limited (Registration number 1918/000095/06) information JSE codes: BAW and BAWP ISIN codes: ZAE000026639 and ZAE000026647 Registered offjce and business address Barloworld Limited, 180 Katherine Street, PO Box 782248, Sandton, 2146, South Africa Tel +27 11 445 1000 Email invest@barloworld.com Transfer secretaries – South Africa Link Market Services South Africa (Proprietary) Limited, (Registration number 2000/007239/07), 13th Floor, Rennie House, 19 Ameshoff Street, Braamfontein, Johannesburg 2001, (PO Box 4844, Johannesburg) Tel +27 11 630 0000 Registrars – United Kingdom Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, England Tel +44 190 383 3381 Transfer secretaries – Namibia Transfer Secretaries (Proprietary) Limited, (Registration number 93/713), Shop 8, Kaiser Krone Centre, Post Street Mall, Windhoek, Namibia (PO Box 2401, Windhoek, Namibia) Tel +264 61 227 647 Enquiries: Jacey de Gidts ABC Head, Group communications and marketing, Barloworld Limited Tel +27 11 445 1000 E-mail invest@barloworld.com For background information visit www.barloworld.com
Merrill Lynch Conference 12-13 March 2013 1 Barloworld Limited Barloworld Limited Merrill Lynch Conference Sun City 12 -13 March 2013 Strategic developments Update on corporate activity • Acquired Bucyrus Russia on 3 December 2012 for R436m • Converted Congo Equipment in the DRC into a 50 year JV • Acquired 25% Logistics Africa minority • Acquired a 50.1% share in Manline Logistics Emphasis on driving profitable growth and enhancing financial returns 2
2 Barloworld Limited Merrill Lynch Conference 12-13 March 2013 Key strategic developments • Reached agreement to acquire Bucyrus Russia effective 3 December for R436m • Finalised agreement to convert Congo Equipment in the DRC into a 50 year JV Equipment • EMD Africa JV with Electromotive Diesel to capture locomotive and rail services opportunities • MWM distribution rights for gas engines in southern Africa and Russia • Secured Lesotho government contract extension in Avis Fleet Services • Secured City of Johannesburg outsourced fleet management contract for 5 years Automotive • Acquired a minority interest in re- environmental solutions and waste and Logistics management business • Acquired a 50.1% share in Manline to form Barloworld Transport Solutions • Disposed of Handling US and UK in 2012 • Reviewing strategic options for Belgium and the Netherlands Handling • Expanded agriculture business in Siberia, western Russia and Mozambique • Grew SEM in Africa and Russia 3 Group revenue Revenue September 2012 Revenue September 2011 8% 10% 25% 28% 7% 7% 50% 5% 53% 7% Equipment Southern Africa Equipment Europe Equipment Russia Automotive and Logistics Handling 4
Merrill Lynch Conference 12-13 March 2013 3 Barloworld Limited Group operating profit Operating Profit September 2012 Operating Profit September 2011 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% -10% -10% Handling Equipment Southern Africa Equipment Europe Equipment Russia Automotive and Logistics Corporate 5 Equipment Southern Africa
4 Barloworld Limited Merrill Lynch Conference 12-13 March 2013 Geographical outlook 7 Market outlook* suggests continued medium term growth, but short term softening Building Construction Heavy Construction Contract Mining 34% 52% Mining Houses 47% 34% 52% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 * Based on traditional Caterpillar industry ex Bucyrus 8
Merrill Lynch Conference 12-13 March 2013 5 Barloworld Limited BWE is well positioned to take advantage of the growth in mining in our territories Mine development in the next 10 years will come from the following areas Russia/CIS/Mongolia 20% Africa 12% Eastern Europe 6% Western Europe 2% South America 14% China 13% Australia 12% North America 8% Rest of Asia 7% India 6% BWE has dealership presence in territories where 32% of mine development will take place in the next 10 years Source: Caterpillar Inc. 9 Extended mining product range – Bucyrus acquisition Open Pit Surface Mining Underground Mining Room and Pillar Hard Rock Longwall 10
6 Barloworld Limited Merrill Lynch Conference 12-13 March 2013 Bucyrus product line overview Hydraulic Excavators Drills Draglines and Rope Shovels Highwall Miner Longwall Room and Pillar Belt Systems Consumables Trucks 11 Major surface mining opportunities Coal Copper Iron ore Uranium Jindal FQM – Kalumbila Barrick – Lumwana Vale and Rio Tinto –Tete Bannerman – Etango Anglo Coal- Revuboe Extract Resources – Husab Zonnebloem Xstrata Kumba – Sishen ResGen – Boikarabelo Exxaro – Belfast Project CoAL – Makhado Xstrata – Tweefontein Anglo – New Largo 12
Merrill Lynch Conference 12-13 March 2013 7 Barloworld Limited Major underground mining opportunities Coal Copper Diamonds Hwange Zimbabwe Glencore – Mopani Debswana Morupule Mabila Ermelo Project DeBeers Venetia Sasol Impumelelo Total Forzando West Exxaro – Matla Xstrata – Tweefontein Sasol Bossjespruit Anglo – New Denmark Anglo – Goedehoop 13 Major infrastructure projects dependent on governments’ ability to execute and raise finance Awarded and in progress Potential To commence short term Mine Infrastructure Dams, Rail, Ports, Roads Infrastructure Backlogs Power, Ports, Roads North South Water Pipeline and railways Various Road Rehab Mine Infrastructure Neckartal Dam Rail and Dams Mine Infrastructure and 17 SIPS Projects Provincial and Municipal Infrastructure 14
8 Barloworld Limited Merrill Lynch Conference 12-13 March 2013 Roll-out EMPR major deals First Quantum Minerals Contract Value: R1.1bn • Drilling and loading equipment • Machines on order: 3 x 7495 electric rope shovels, 7 x MD6640 rotary blast hole drills • The Sentinel copper deposit is located west of Solwezi in the North Western Province of Zambia Swakop Uranium Contract Value: R1.2bn • Drilling and Loading equipment • Machines on order: 3 x 7495 electric rope shovels, 3 x 6060FS hydraulic mining shovels, 2 x MD6640 and 6 x MD6290 rotary blast hole drills • The Husab Project is regarded as the most important uranium discovery in recent years and will elevate Namibia to the third biggest uranium producer in the world 15 Equipment – southern Africa Outlook • Anticipated reduction in traditional CAT mining deliveries expected to be more than offset by incremental Bucyrus revenues • Firm back orders at December 2012 (R5.7bn) up 7.5% due to Bucyrus order from Swakop Uranium Husab project • Focused on growing sales of the Cat electric drive and Unit Rig (ex-Bucyrus) models – opportunities in the electric drive and ultra-mining truck market • Modest on-going improvement in construction activity including Angola • Parts and service revenues expected to remain solid Order book (Rm) Southern Africa 0 2 000 4 000 6 000 Dec 2012 Sep 2012 Sep 2011 Bucyrus 16
Merrill Lynch Conference 12-13 March 2013 9 Barloworld Limited Equipment Iberia Industry trend and outlook – Iberia: Total 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 18
10 Barloworld Limited Merrill Lynch Conference 12-13 March 2013 Headcount evolution – Iberia Iberia FSA Short term rental STET 2,388 2,363 2,146 1,954 1,792 1,665 1,534 1,417 1,396 1,114 346 273 0 250 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Dec-11 Sep-12 Dec-12 • Headcount across the Iberian region has been reduced by 992 employees or 41% • Average age of workforce reduced Workforce: Number of active employees | Not included: pre- retirement and suspensions. 19 Equipment – Iberia Outlook • Macro economic environment expected to remain challenging in the coming year • Order books lower due delivery of large portion of mining package deal; portions of mining package deals cancelled due to additional governmental austerity program • Power systems growth due to activity in marine and other niche markets • Focus on expanding market share while maintaining margins • Continued focus on cost control, cash generation and asset efficiency • Expect to deliver improved operating performance due to lower cost base Order book (€m) Iberia 0 100 200 300 Dec 2012 Sep 2012 Sep 2011 20
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