[PPT] - PRESENTATION 2019 AGENDA Brian Joffe Group CEO Overview and year PowerPoint Presentation

SLIDE 1

ANNUAL RESULTS

PRESENTATION

2019

Long4Life Limited

SLIDE 2

2

Long 4 Life Annual Results Presentation 2019

2

Long 4 Life Annual Results Presentation 2019

AGENDA

Brian Joffe – Group CEO
Overview and year in review
Mireille Levenstein – CFO
Financial analysis
Brian Joffe – Group CEO
Operational analysis
Sport and Recreation
Personal Care and Wellness
Grant Hobbs – CEO Beverages
Operational analysis
Beverages
Brian Joffe – Group CEO
Strategy and Outlook
Q&A
Supplementary information

SLIDE 3

3

Long 4 Life Annual Results Presentation 2019

Overview and year in review

Brian Joffe – Group CEO

SLIDE 4

4

Long 4 Life Annual Results Presentation 2019

4

Long 4 Life Annual Results Presentation 2019

OVERVIEW

Two years as a listed company on the JSE

There are areas where we could have done better but in general we are proud of the result
A full year of contribution from acquired businesses
HEPS growth of 28% to 38.7 cents
A strong balance sheet that is currently underinvested but

which can accommodate considerably more scale

Corporate office costs are arguably too high but this is deliberate as

we create a well-resourced support foundation for growth in future

No dividends for this period as we bought back shares as a

mechanism to enhance shareholder return

SLIDE 5

5

Long 4 Life Annual Results Presentation 2019

5

Long 4 Life Annual Results Presentation 2019

YEAR IN REVIEW

F2019 was a year of achievement with much to look forward to

Establishing ourselves as a lifestyle-themed group
Decentralised business model
Acquisitions have integrated well and the management team is confident

in our future

Exploiting opportunities in both mature and emerging consumer

Financial analysis

Mireille Levenstein – CFO

SLIDE 7

7

Long 4 Life Annual Results Presentation 2019

Gross margin

39.7%

Trading profit before depreciation and amortisation

R534.9 million

HEPS

38.7 cents

Effective tax rate

28.6%

Cash generated from operations

R465.1 million

Trading margin

12.5%

Trading profit

R454.2 million

Positive first half trajectory continued to second half, with strong finish for the year

Revenue

R3.6 billion

GROUP FINANCIAL HIGHLIGHTS

A sound financial performance

SLIDE 8

8

Long 4 Life Annual Results Presentation 2019

8

Long 4 Life Annual Results Presentation 2019

ACQUISITION TIMELINE

First full 12 months of trading

F2018:
Raised R2 billion on listing in April 2017
Holdsport, Sorbet and Inhle acquired effective 1 November 2017
F2019:
Chill Beverages acquired for R493 million effective 1 March 2018

(cash R368 million and shares R125 million)

Other smaller acquisitions:
Limelight acquired for R25.1 million effective 1 March 2018
ClaytonCare acquired effective 1 September 2018

for R 39.9 million (36% economic effective interest)

Comparatives not meaningful

SLIDE 9

9

Long 4 Life Annual Results Presentation 2019

PROFIT & LOSS

All three operating segments performed well

Unpacking margins and expenses

Gross profit R1.4 billion, gross margin 39.7%

(H1: 40.9% and H2: 38.8%)

GP margins maintained overall despite consumer price

sensitivity, manufacturing cost pressure, VAT increase

Corporate costs reflect investment in corporate office

capability for expansion in the future

Major expense categories
Staff

R445 million (48% of total expenses)

Occupancy

R271 million (29% of total expenses)

Depreciation

R81 million (2.2% of turnover)

Revenue Rm Trading profit Rm Trading margin Sport and Recreation 2 113.0 321.1 15.2% Beverages 1 355.5 153.8 11.3% Personal Care and Wellness 173.8 38.9 22.4% Central / corporate (59.6)

Total

3 642.3 454.2 12.5%

58% 37% 5%

Contribution to revenue

62% 30% 8%

Contribution to trading profit

(excluding Central) Sport and Recreation Beverages Personal Care and Wellness

SLIDE 10

10

Long 4 Life Annual Results Presentation 2019

40,9% 38,8% 39,7% 27,4% 24,1% 25,5% 11,6% 13,1% 12,5%

H1 F2019 H2 F2019 F2019

PROFIT & LOSS

Trading margin assisted by H2 operating leverage

Results weighted to second half due to seasonality
All three operational segments experience increase

trading in summer months

Approx 40/60 H1 H2 split in trading profit
Operating leverage in second half clearly evident
Trading margin 12.5%

(H1: 11.6% and H2: 13.1%)

Gross margin 39.7% (H1: 40.9% and H2: 38.8%) (H2

typically lower due to markdown sales)

Revenue Trading profit 2019 H2 H1 H2 H1 Sport and Recreation 56% 44% 60% 40% Beverages 59% 41% 63% 37% Personal Care and Wellness 68% 32% 61% 39% Group (before central costs) 58% 42% 61% 39%

Gross profit % Expenses % Trading margin %

SLIDE 11

11

Long 4 Life Annual Results Presentation 2019

11

Long 4 Life Annual Results Presentation 2019

Cents per share

Group HEPS on R348.8 million 38.7 Net interest income after tax (5.7) Corporate costs after tax (central, acquisition and share based payments 7.4 Operating headline earnings 40.4

PROFIT & LOSS

Operating earnings of 40.4 cents per share, 16.1 cents in H1 and 24.3 cents in H2

HEPS of 38.7 cents
Unpacking operating headline earnings*

* Detailed computation provided in supplementary information

Weighted average no. of shares: 902.1 million
No of shares in issue: 913.9 million (net of treasury shares 877.4

million)

Treasury shares acquired: 36.4 million shares (at R4.38 per share),

with 13.2 million shares for the 2018 FSP share scheme

SLIDE 12

12

Long 4 Life Annual Results Presentation 2019

12

Long 4 Life Annual Results Presentation 2019

FINANCIAL POSITION

Measuring our performance and returns

Return on funds employed (ROFE)
Internal measure of trading performance - measures operational efficiencies of trading

assets, separates investment and financing decisions

Group ROFE at 42%
Cash conversion ratio
Cash generated by operations was 102% of trading profit
Enhanced by large depreciation charge
Return on Equity (ROE)
7.6% after tax return on average for the year
Reflective of infancy of group, not fully invested, no gearing,

two-year period of acquisition and capital raising

Creating a total asset base of R5.8 billion and equity of R4.8 billion
Significant balance sheet capacity to grow and achieve future optimal

return objectives

SLIDE 13

13

Long 4 Life Annual Results Presentation 2019

FINANCIAL POSITION

Asset, equity and liability position

Group is not fully invested
Working capital:
Stock turnover - 2.7 x cost of sales
Trade debtors - no retail credit offering
Detailed working capital breakdown provided in

supplementary information

Borrowings - Bond on Chill property

R’000 2019 2018 ASSETS 5 796 663 5 144 377 Property, plant and equipment 526 502 198 955 Goodwill & Intangibles 3 038 741 2 571 733 Tax receivables & deferred tax 29 509 12 040 Associate 3 428

Other investments & loans

6 045 22 982 Inventory 812 525 580 363 Receivables 291 768 66 642 Cash 1 088 145 1 691 662 EQUITY & LIABILITIES 5 796 663 5 144 377 Capital & reserves 4 871 375 4 523 863 Tax payables & deferred tax liabilities 238 823 162 320 Borrowings 92 944 160 338 Provisions

2 126

Put option liability 48 000 48 000 Lease smoothing liability 48 026 47 353 Payables 497 495 200 377

SLIDE 14

14

Long 4 Life Annual Results Presentation 2019

14

Long 4 Life Annual Results Presentation 2019

Strong operating cash flows
Cash generated by operations before working capital R537.0 million
Working capital
Absorption of R71.9 million
Typical w/c cycle is absorption in H1 and generation in H2
Operations manage their w/c to suit their particular requirements
Cash generated by operations after working capital R465.1 million

(102% of trading profit)

Cash outflows from investing activities of R566 million
Capex expenditure R155.3 million (R76 million expansion capex)
Acquisition of subsidiaries consumed R426 million
Cash outflows from financing activities of R427 million
Repayment of borrowings R216 million (Holdsport R160 million and

Chill R56 million)

Treasure shares acquired R159.6 million

CASH FLOWS

The group is inherently cash generative

SLIDE 15

15

Long 4 Life Annual Results Presentation 2019

15

Long 4 Life Annual Results Presentation 2019

FINANCIAL GUIDANCE

Firepower to expand and increase scale

Strong financial position
R1.1 billion in cash on hand
Cash acquisition capacity is approximately R2 billion, by introducing

gearing

Operational cash generation
Current portfolio of businesses is generating approximately R590

million in trading profit before depreciation

Seasonality and operating leverage - H2 revenue and trading

profit significantly higher than H1

Investment in capex planned in year ahead at similar levels

to support growth

The group is targeting real growth in earnings in F2020

SLIDE 16

16

Long 4 Life Annual Results Presentation 2019

Operational analysis

Brian Joffe – Group CEO

SLIDE 17

17

Long 4 Life Annual Results Presentation 2019

A clear strategic focus, a proven model and excellent execution delivers a real increase in sales

New Sports stores in shopping malls generated pleasing footfall and provide valuable learnings
Disciplined store expansion and trading
Strong portfolio of international brands and own brands
Retail price deflation of 0.9% (2018: retail inflation 1.4%), yet 3.6% growth in trading density
A small and temporary negative impact on GP and sales due to the 1% rise in VAT
Outdoor Warehouse performed credibly, off a high base
Performance Brands design and manufacturing capability provides good potential and differentiation

Outlook

Selective expansion is continuing and trading space will grow by at least 2.5% in F2020

2019 2018 Year-on-year Stores Growth in sales Same store Stores Growth in sales Same store Sports retail* 43 10.1% 4.0% 40 5.1% 2.6% Outdoor Warehouse 26 3.3% 4.1% 26 8.8% 6.1% Total retail 69 8.4% 4.0% 66 6.0% 3.4% Performance Brands N/A (2.5%) N/A 33.7%

SPORT AND RECREATION

Revenue R2 113m, trading profit R321m, trading margin 15.2%

* Sports Retail division consist of the sales of Sportsmans Warehouse stores, OTG Active and Shelflife

SLIDE 18

18

Long 4 Life Annual Results Presentation 2019

PERSONAL CARE & WELLNESS

Revenue R174m, trading profit R39m, trading margin 22.4%

A record result driven by growing brand recognition as an affordable, well-run grooming offering

Seamless CEO transition with Rudi Rudolph taking up the role
Revenue growth of 19% year-on-year with trading profit

growth of 74%

Sorbet Man is showing potential with 20 stores operating

and with more in the pipeline

Limelight, a distributor of hair and beauty products,

contributed 12% of segment profits, generating a trading margin of 16.5%

ClaytonCare - 36% effective interest, made a modest contribution for six months

Outlook

Sorbet is budgeting for good growth in trading profit in F2020

with total stores growing to 219 from 207

Store formats Stores 28/2/2019 New stores Salons/nail bars 164 5 Dry bars 15 1 Sorbet Man 20 8 Candi & Co 8 1 Total 207

SLIDE 19

19

Long 4 Life Annual Results Presentation 2019

Operational analysis

Grant Hobbs – CEO Beverages

SLIDE 20

20

Long 4 Life Annual Results Presentation 2019

Strong growth in case volumes with market share gains being realised

Case volume mix - 62% (68%) contract packing, 34% (27%) own-brand, and 4% (5%) private label
Premium mixer brands Fitch & Leedes and Score energy drinks driving own-brand, vigorous innovation
Own-brand 50% volume growth, co-packing volumes increased by 9% (predominantly in energy segment)
Geographic production and distribution synergies and costs savings being realised between Chill and Inhle
Investing for growth and improved facilities
Continuing capex through F2020 to provide capacity for growth
Investment authorised subject to strict criteria, including

anticipated returns

Outlook
Categories are competitive but growing overall
A modern fixed asset base delivering a high-quality product
Well placed to deliver an improved result in F2020

BEVERAGES

Revenue R1 355m, trading profit R154m, trading margin 11.3%

Year-on-year % increase Case volumes sold 19 Revenue 28

SLIDE 21

21

Long 4 Life Annual Results Presentation 2019

Update on strategy and outlook

Brian Joffe – Group CEO

SLIDE 22

22

Long 4 Life Annual Results Presentation 2019

22

Long 4 Life Annual Results Presentation 2019

UPDATE ON STRATEGY

Previously articulated strategic objectives are unchanged

Own the cash flows in the main
Quality trading profits from good cash generating businesses with low to medium

risk characteristics

Strict decentralised philosophy but sharing what we learn
Commercially minded corporate office accessing potential deals

and sourcing competitively priced funding

Patient for the right opportunities at the right value
Will gear the balance sheet prudently as necessary to build scale

through acquisitions

Potential use of scrip will be balanced so as not to dilute shareholders
Real value seen in buybacks in the prevailing small to mid-cap valuation

environment and HEPS accretive

SLIDE 23

23

Long 4 Life Annual Results Presentation 2019

OUTLOOK

Another positive result is anticipated in F2020

Substantial scope to build off a platform of good quality lifestyle-themed assets
An uncertain macro climate presents us with opportunity and we have the flexibility to take advantage
Our brands

SLIDE 24

ANNUAL RESULTS

Supplementary

2019

Long4Life Limited

SLIDE 25

25

Long 4 Life Annual Results Presentation 2019

R’000 EPS Cents Headline earnings - Group 348 814 38.7 Net corporate costs after tax 67 021 7.4 Net interest after tax 51 537 5.7 Headline earnings excluding net interest 297 277 33.0 Headline earnings excluding net corporate costs 415 835 46.1 Headline earnings excluding net interest and corporate costs 364 298 40.4 Operating headline earnings per share 40.4 Corporate costs after tax per share (7.4) Interest income after tax per share 5.7 Group headline earnings per share 38.7 Weighted number of shares in issue '000 902 054

FINANCIALS – OPERATING EARNINGS COMPUTATION

R’000 before tax R’000 after tax Total corporate costs (R’000) 89 863 67 021 Share based payments 21 939 15 796 Acquisition costs 8 285 8 285 Central costs 59 639 42 940

SLIDE 26

26

Long 4 Life Annual Results Presentation 2019

FINANCIALS

Result weighted to the second half due to seasonality - an approximate 40/60 H1/H2 split in trading profit

Revenue Annual/ H1 ratio 2019 R’000 H2 R’000 H1 R’000 H2 % H1 % Group 3 642 341 2 109 421 1 532 920 58 42 Sport and Recreation 2.28 2 113 025 1 185 711 927 314 56 44 Beverages 2.47 1 355 450 806 073 549 377 59 41 Personal Care and Wellness 3.09 173 866 117 637 56 229 68 32 Trading profit excluding Corporate Annual/ H1 ratio 2019 R’000 H2 R’000 H1 R’000 H2 % H1 % Group 513 796 311 447 202 349 61 39 Sport and Recreation 2.48 321 133 191 473 129 660 60 40 Beverages 2.67 153 753 96 106 57 647 63 37 Personal Care and Wellness 2.59 38 910 23 868 15 042 61 39

58% 37% 5%

Contribution to revenue

62% 30% 8%

Contribution to trading profit

(excluding Corporate) Sport and Recreation Beverages Personal Care and Wellness

SLIDE 27

27

Long 4 Life Annual Results Presentation 2019

FINANCIALS

F2019 Acquisitions detail

Chill acquisition effective 1 March 2018
Consideration of R493m
25% in shares and 75% in cash (R368m)
Net tangible value R251m
Goodwill R242m
Assumed debt of R143m
In addition, R14m for Score Energy trademark
ClaytonCare effective 1 September 2018
Net consideration of R26m after cash acquired
In addition, R16m for 100% of property
LimeLight effective 1 March 2018
Consideration of R25m
Sorbet Morningside (corporate ownership)
R3m

SLIDE 28

28

Long 4 Life Annual Results Presentation 2019

FINANCIALS

Contribution to results by acquired subsidiaries:

Subsidiary (R’000) Revenue Trading profit* Chill 1 205 632 96 884 ClaytonCare* 42 513 4 455 Limelight 27 310 4 540 Property 927 466 Group 1 276 382 106 345 * Net contribution to L4L (36%) 1 604

SLIDE 29

29

Long 4 Life Annual Results Presentation 2019

FINANCIALS

Balance sheet as at 28 February 2019

Shares in issue 913.9m
Treasury shares 36.5m
Net shares in issue 877.4m
Ordinary shareholders equity R4 811.1m (548 cents per share net of treasury shares)
Minorities R60.3m
Total assets R5 796.7m
Goodwill and intangibles arising on acquisitions R3 038.7m
Cash of R1 088.1m
Total borrowings R92.9m

SLIDE 30

30

Long 4 Life Annual Results Presentation 2019

FINANCIALS

Long4Life share based expenses

Share Appreciation Rights (SAR)
Forfeitable Share Plan (FSP)
Conditional Share Plan (CSP)
CSP put in place at pre-listing that had conditions and growth targets

with only market conditions applying

This means macro, external market conditions not company specific
An IFRS2 anomaly arises such that when incentive targets are

based on market conditions only the expense cannot be reversed, even if the shares don’t vest

CSP expensed even if without value and is non-cash
No new CSP’s will be issued. The FSP scheme replacing the CSP was put in

place during F2019 and targets predominantly company related

In F2019, the following was expensed

CSP CEO R10.6m
CSP other (0% forfeiture) R4.8m
SAR R2.1m
FSP R4.4m (from Nov 2018)
Total R21.9m

SLIDE 31

31

Long 4 Life Annual Results Presentation 2019

FINANCIALS

Working capital by segment

* Trade payables R304 584

R’000 Inventory Receivables Payables* Net Sport and Recreation 638 646 37 110 (158 580) 517 176 Beverages 149 874 223 864 (290 329) 83 409 Personal Care and Wellness 24 005 30 670 (35 155) 19 520 Corporate

124

(13 431) (13 307) Group 812 525 291 768 (497 495) 606 798

SLIDE 32

32

Long 4 Life Annual Results Presentation 2019

FINANCIALS

Capital expenditure

R’000 Refurbishment & maintenance Expansion Total Sport and Recreation 68 858 22 100 90 958 Beverages 868 60 532 61 400 Personal Care and Wellness 1 000 1 875 2 875 Corporate

83

83 Group 70 726 84 590 155 316

SLIDE 33

33

Long 4 Life Annual Results Presentation 2019

FINANCIALS F2018

Key take aways from the eleven month period ended 28 February 2018

Change to a February year end to align with the largest acquired businesses (Sport and Recreation)
L4L acquired 100% of Holdsport, Sorbet, and Inhle (effective date on each 1 November 2017)
Acquisitions total consideration of R2.9bn funded through cash (R574.5m) and shares (R2.3bn)
see note 7.4 in the 2018 IAR for detail hereon
Refer to public announcements relating to acquisitions
Corporate expenses for eleven months
Holdsport, Sorbet, and Inhle Beverages contributed for four months
Net interest income of R122.3m remained significant in relation to trading profit of R147.5 million
Net interest income 51% of pre-tax profit
Balance sheet reflected cash of R1.7bn, 85% of the equity capital (R2.0bn) subscribed for on listing
564.1m weighted average shares
Total shares in issue 889.8m
Net asset value 506 cents per share

SLIDE 34

34

Long 4 Life Annual Results Presentation 2019

SPORT AND RECREATION

Segment overview

Sportsmans Warehouse, Outdoor Warehouse, E-Commerce, Performance Brands

(owns and distributes the First Ascent, Capestorm, Second Skins, and African Nature brands), Shelflife, and OTG Active

Total sales increased 7.9% to R2.1bn with R1.2bn in sales achieved in H2.
GP margin of 48.0% was in line with the previous two years. Whilst sales are weighted to H2, the H2 GP margin

is typically lower than H1 due to December/January discount sales

Same store retail sales grew 4.0% (0.4% in H1)
Sports retail grew 4.0% (0.1% in H1) and Outdoor Warehouse grew 4.1% (1.6% in H1)
Retail price deflation of 0.9% for the year (inflation of 0.6% in H1)
Forward FX contracts cover imported merchandise
R12.2m FX profit for the year (R10.4m FX profit in H1)
Stock levels are under scrutiny to assess where improvements can be made
Trading expenses growth of 8.2% (8.5% in H1), driven by 3.5% space growth (3.4% in H1) and CPI
Trading density increased by 3.6% to R21 204 per m² (R20 473 in F2018)
Member Rewards, developed with online expertise, is popular and using e-commerce assists with customer engagement
Basket size flat across the footprint compared to prior year

SLIDE 35

35

Long 4 Life Annual Results Presentation 2019

SPORT AND RECREATION

Sportsmans Warehouse

Somerset West and Nelspruit store sizes increased, scope to make big stores bigger for range and category expansion
Sportsmans Warehouse smaller mall-based store typically 1 000m²
Modified fixtures and design
Retains an almost complete experience relative to the traditional stores with certain items not stocked available to

customers within a short delivery window

Rosebank, Sandton City and Stellenbosch opened during F2019, all traded well and customer feedback is positive
New Eastgate mall-store May 2019
Design and fixtures will be implemented in larger existing stores as part of company-wide refurbishment programme
Ladies only OTG Active
Two 100m² stores opened with two more contracted in F2020 in prime locations
Also features as an “elevated” boutique execution in Sportsmans Warehouse
Online sneaker footwear range Shelflife complements Sportsmans Warehouse offer and a separate sales channel
Breadth and depth of a truly authentic sporting goods and athleisure offering + specialist advice a differentiator
Refining the customer experience through in-store kiosks, rapid click & collect order processing, and fulfilment

SLIDE 36

36

Long 4 Life Annual Results Presentation 2019

SPORT AND RECREATION

Outdoor Warehouse

Retains a key competitive advantage as a destination store with a comprehensive range of outdoor equipment

and apparel, with in-store services and specialist advice

Traded satisfactorily off a relatively high base as prior year sales were up 8.8%
Weighted trading space increased by 1.3% (7.1% in F2018)
Selling price deflation during year
A shorter December holiday period resulted in softer seasonal demand
Two stores were reduced in size to improve trading density and merchandising efficiencies
Refurbishment of store estate completed, incorporating latest design
Currently 26 stores with a new store planned for Randburg in F2020

Online

Seamless web and store capability targeted to be at world-class standard
Webrooming window for online browsing by customers, complementing physical footprint
Data leads to improved customer understanding and business inventory management

SLIDE 37

37

Long 4 Life Annual Results Presentation 2019

SPORT AND RECREATION

Wholesale (Performance Brands)

Represents the First Ascent, Capestorm, Second Skins and African Nature brands
Also develops own label technical apparel and equipment
Production from South Africa and international
Internal sales to the retail operations increased and are expected to grow ahead of independent sales in future
External sales to a variety of customers, including corporates, schools and the tourism sector ie game lodges
A significant business which is highly complementary and strategic

SLIDE 38

38

Long 4 Life Annual Results Presentation 2019

BEVERAGES

Chill Beverages

Factory located in Stellenbosch, Western Cape
Manufactures own-brand soft drinks and bespoke upmarket premium mixers, house-brand drinks for retailers,

and contract packing drinks for companies of varying size and requirements

Sources own raw materials – ingredients and packaging
Turnover up 29% to R1.2bn, trading profit improves to R96.9m, trading margin 8.0%
Plant and equipment increased by 22% due to investment in capacity
Upgraded glass capacity by 50% and canning capacity by 27%
Brand evolution continued, including launch of two water brands
Marketing teams now split into focused Fitch & Leedes and Score teams
Own-brands 56% of cases sold, up from 47%, due to continued strong demand and volume growth
The Health Promotion Levy on sugary beverages has had minimal impact as the industry reformulated

SLIDE 39

39

Long 4 Life Annual Results Presentation 2019

BEVERAGES

Inhle

Factory located in Heidelberg, Gauteng
Co-packing drinks business, predominantly aluminium beverage cans
Energy drinks the largest category at 90% of production
Low cost producer that allows private label customers to compete with drinks majors
Beverage canning filling expertise with up-to-date machinery and plant
Plant and equipment increased by 38% due to investment in capacity
Upgraded canning capacity by 20% and completed a new warehouse and customer centre
Ample land and water on Heidelberg property to expand
Currently at full capacity and examining expansion options

SLIDE 40

40

Long 4 Life Annual Results Presentation 2019

PERSONAL CARE & WELLNESS

Segment overview

Positioned within professional beauty services and selling independent leading brands and own-brands
Beauty salons and dry bars – facials, nails, waxing, massage, specialist products (Sorbet brand)
Men’s grooming (Sorbet Man brand)
Hair salon that specialises in ethnic hair (Candi & Co. brand)
Corporate owned Sorbet SK-N, offering skin and aesthetic treatments, launched May 2019 in Hyde Park

as a stand alone

Wholesale (Limelight)
ClaytonCare sub-acute rehabilitation centres

SLIDE 41

41

Long 4 Life Annual Results Presentation 2019

PERSONAL CARE & WELLNESS

Sorbet

A total of 15 new stores opened
5 new salons, 8 new Sorbet Man stores, 1 new dry bar, and 1 Candi & Co.
25 store refurbishments
Revenue increase by 19% to R102.8m with trading profit growing strongly to R31.4m, with the margin at 30%
Store sales mix approximately 75% services and 25% merchandise
Treatment mix has shifted in line with the economic environment and customers are seeking keener priced product
Differentiation is knowledgeable and committed franchisees, high standards of hygiene, and thorough staff training
Rate of renewals from long-standing franchisees at a satisfactory level
In F2020, 6 salons, 3 Sorbet Man, 1 nail bar, and 2 dry bars confirmed with 60 stores scheduled for refurbishment

Limelight

A positive contribution in the first year with revenue of R27.3m and trading profit of R4.5m, margin at 16.5%
Sole distribution rights to American Crew and OWAY acquired

SLIDE 42

42

Long 4 Life Annual Results Presentation 2019

PERSONAL CARE & WELLNESS

Acquisition of ClaytonCare Healthcare Group

Mechanism of acquisition
L4L acquired 59% of Long4Life Health, which in turn owns 61% of ClaytonCare
Resulting in an effective 36% economic interest in ClaytonCare operating entity wef 1 Sept 2018
L4L has 100% ownership of a property
R42.5m in revenue and R4.5m in trading profit, a margin of 10.6% - at the 100% level
A sub-acute (stepdown) rehabilitation medical group with capacity of 83 beds
An affordable service that is a complement to the wellness theme
Currently has 2 facilities – Clayton House in Randview and Care@Midstream