PRESENTATION RMB Morgan Stanley Off-Piste Conference 29 Sep 2017 Presented by Arnold Goldstone (Chief Executive Officer)
Agenda 01 COPORATE HISTORY 02 BUSINESS PROFILE Capital Equipment Group Engineering Solutions Group Building Supply Group 03 KEY FINANCIAL INFORMATION 04 PROSPECTS AND STRATEGY 05 EXEC MANAGEMENT & SHAREHOLDING Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 2
CORPORATE HISTORY • 1989: Founded and listed on Johannesburg Stock Exchange (JSE) • Top 100 Company for 21 years since then • Annual Global Revenue of Invicta Group R10bn+ (US$ 750m+) • Presence in over 20 countries • Over 5 000 employees • Revenue: 74% SA, 26% rest of world • Importer and distributor of industrial consumables, capital equipment and related spares Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 3
BUSINESS PROFILE Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 4
Divisional structure CAPITAL EQUIPMENT ENGINEERING SOLUTIONS BUILDING SUPPLY GROUP GROUP GROUP (Discontinued) Leading distributor of Importer & distributor of Manufacturer, wholesaler engineering consumables agricultural equipment, and distributor of building and provider of engineering construction equipment, supplies worldwide solutions forklifts and aftermarket replacement parts • BMG • MacNeil • Northmec Hansen Distribution o o • New Holland* OST Manufacturing o o • CSE • Mandirk • Brands 4 Africa • Doosan SA Tool • Tiletoria o • HPE Sibuyile o • ESP • Autobax • Criterion • Hyflo • Kian Ann Group *Equipment sales discontinued. Aftermarket support continues (spare parts). Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 5
Engineering Solutions Engineering Solutions • BMG (Bearing Man Group) Engineering components & technical services o 135 branches o Bearings, Seals, PT , Tools, Fasteners o Drives, Motors, Belting, Field Services o Filtration, Hydraulics, Lubrication, Pneumatics o • Hansen Mandirk Group (incl SA Tool) • Tools & equipment o 19 branches & subsidiaries o Autobax • Automotive o 3 branch network o OST • • Hyflo Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 6
Capital Equipment (SA) ) • Northmec (Agricultural Machinery) • New Holland* (Agricultural Machinery) • CSE (Earthmoving Machinery) • Doosan (Earthmoving Machinery) • HPE (Hyundai Earthmoving) • Criterion (Forklifts) • ESP (Parts) • 201 dedicated outlets *Equipment sales discontinued. Aftermarket support continues (spare parts) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 7
Capital Equipment (Kian Ann Group) Kian Ann Engineering • One of the world's largest independent distributors of heavy machinery and diesel engine parts • HQ in Singapore • Subsidiaries in Singapore, Indonesia, China, Canada, United Kingdom and Myanmar • Joint venture in India • Associate in China Kian Chue Hwa Industries • One of Asia’s largest independent distributors of commercial and industrial vehicle parts • HQ in Singapore • Subsidiaries in Indonesia, Thailand and Malaysia • Associate in Myanmar Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 8
Building Supply Group (Discontinued) • Tiletoria • MacNeil Distributors • Brands 4 Africa • 15 outlets in SA Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 9
KEY FINANCIAL INFORMATION Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 10
REVENUE (R bn) Acquired Sold BSG Acquired 14 after y/e GFC Kian Ann Macneil Sold Engineparts (T/O R250m) 12 12 10 11 10 10 R billion 8 8 6 6 4 5 5 4 3 2 3 2 2 2 2 1 1 1 - Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 11
EPS (cents per share) Feb 15: Special div (R1.5bn) & rights issue (44% more shares (107m in issue)) 900 788 742 800 737 700 647 Cents per share 600 504 499 500 437 453 396 400 356 292 300 133 164 190 170 200 46 60 100 0 Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 12
Revenue contribution by operating segment (excluding Head Office) R’million 14 000 11,513 12 000 10,465 10,620 10,455 1,893 10 000 1,388 1,837 1,639 7,558 8 000 4,665 630 3,955 4,209 4,299 6 000 3,425 4 000 5,122 4,955 4,607 4,484 2 000 3,503 0 MAR 2013 MAR 2014 MAR 2015 MAR 2016 MAR 2017 Building Supply Group 16% (17%) 43% Capital Equipment Group (43%) 41% Engineering Solutions Group (40%) 2017 (2016) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 13
Operating profit contribution by operating segment (excluding Head Office) R’million 1 200 1,058 1,043 1,024 1 000 108 87 67 838 768 800 70 39 473 499 480 600 406 390 400 484 470 457 200 362 339 0 MAR 2013 MAR 2014 MAR 2015 MAR 2016 MAR 2017 Building Supply Group 10% (9%) 44% Capital Equipment Group (43%) Engineering Solutions Group 46% (48%) 2017 (2016) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 14
Revenue contribution by region (includes discontinued operations) Other 5% (3%) Asia 14% (9%) 7% Africa (11%) 74% (77%) South Africa* Y/E 31 Mar 2017 (2016) *Target: 50% by 2020 Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 15
Revenue contribution by sector (includes discontinued operations) Mining 12% (14%) Construction 27% Manufacturing & Industry (29%) 12% (15%) 24% 25% General Trading (19%) (23%) Agriculture & Forestry 2017 (2016) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 16
Return on Net Operating Assets (RONA) (based on average net operating assets) 35% 30% 25% 20% 15% 10% 5% 25,8% 29,8% 30,9% 24,8% 17,5% 21,8% 19,4% 17,6% 20,6% 24,1% 27,3% 22,5% 0% FY 2015 FY 2016 FY 2017 CEG ESG BSG IVT Group Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 17
Earnings per share H1 & H2 (5 yr history) 1 000 955 78m weighted 900 average nr of ordinary shares 218 788 800 742 700 88 Rights issue 600 430 107m weighted Cents average nr of 499 425 500 ordinary shares 361 396 400 29 246 300 160 200 358 312 293 253 207 100 0 MAR 2013 MAR 2014 MAR 2015 MAR 2016 MAR 2017 1st Half 2nd Half Once-off Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 18
INVICTA SHARE PRICE HISTORY 5 YRS (CENTS) Special dividend and rights issue Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 19
PROSPECTS AND STRATEGY Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 20
Prospects • Signs of improvement in South East Asia • SA: tough trading conditions (mining charter, recession, low business confidence, too much political uncertainty = very little new investment) • Benefits of relocations, restructurings and expansions to start coming through in H2 • Focus of the Group will remain on: o margin management and cost control o working capital optimisation o cash generation Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 21
Prospects contd. • Proceeds from sale of BSG likely to flow in next month • R1bn + available for acquisitions. Stay focused on industrial consumables and capital equipment (deep knowledge of these industries, high cash generation, good return on sales and good return on equity) • Local and international investments • Local acquisition opportunities improving at realistic prices • Offshore acquisitions: hallmark is high P:E’s but low cost of debt • Regulatory approval obtained for secondary listing (will do it only if it makes sense to do so to raise hard currency) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 22
Strategy I nvicta’s strategy is to: • Generate healthy cash from existing businesses • Build on the strength of the current businesses • Focus on customer service, value-added distribution and supply chain efficiencies • Diversify the Group’s revenue stream geographically by organic growth and acquisition • Make targeted acquisitions • Maintain RONA >20% for each of the underlying businesses • Improve group return on equity • Targeting 50% of group income from offshore by 2020 Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 23
Group profit drivers • Mining and industrial activity (ESG) • Agricultural activity (Northmec and aftermarket parts) • Construction and earthmoving activity (CSE, Doosan SA & HPE) • Warehousing (Criterion Equipment) • Global replacement spares market (Kian Ann) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 24
EXECUTIVE MANAGEMENT AND SHAREHOLDING Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 25
Executive Management Team BOARD OF DIRECTORS Dr Christo Wiese (Non-Executive Chairman) ENTITY CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER Invicta Holdings ARNOLD GOLDSTONE CRAIG BARNARD TONY SINCLAIR GEOFF BALSHAW Capital Equipment Group Engineering Solutions Group GAVIN PELSER BENNIE GROENEWALD Building Supply Group NEIL MALHERBE KEVIN DIAB (Discontinued) Invicta Holdings Limited | Off-Piste Conference 29 Sep 2017 26
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