Business context and trading conditions

The new Bidvest Travel and Aviation division brings together existing ground-handling operations, airport lounges, the air cargo business, our travel management brands and Budget Car and Van Rental.

Our main focus was developing sustainability in business terms, including sustainable growth, profitability and sound business practices. We reorganised Bidair, creating a leaner, better-structured business that can focus on its operating efficiencies and client service and our bottom line increased significantly as a result.

The reorganisation resulted in enhanced focus on training. For our ground-handling operation this sets the scene for a focused effort to achieve an IATA Safety Audit for Ground Handling Operations (ISAGO) accreditation this year.

Performance

Results in the context of challenging industry conditions were very pleasing. Revenue of R1,9 billion (2010: R1,7 billion) was up by 8,1%. Trading profit of R274,2 million (2010: R207,2 million) was 32,3% higher.

Despite competitor pressures, margins improved through better procurement and rationalisation activities. ROFE improved to 20,5%.

Rationalisation within our travel management business continued. All teams engaged in focused efforts to manage expenses and drive efficiencies. Quality standards were not compromised in pursuit of savings.

Bidair won new ground-handling contracts, including two with African carriers, complementing our positioning as a supplier to some of the world’s leading airlines. Bidair’s service-level agreements involve measuring, among other things, the extent to which we deliver our services on time and how far we may be responsible for a given delay. Our on-time performance is very high, scoring well over 99% – illustrating the quality of our service.

For the third year in succession, Bidair teams at Cape Town International Airport won the ACSA Feather Award as the best ground-handling service provider – testimony to the quality of our people and the effectiveness of the training effort.

Bidvest Premier airport lounges, part of Bidair, invested R7 million to completely refurbish its international lounge at O.R. Tambo international airport. This brings total investment in the lounges over recent years to almost R40 million. Our product offering and service standards were dramatically improved and a hospitality mindset was introduced to all our lounges. Bidvest Premier is the only commercial lounge brand that has truly national representation.

Sustainability

Bidair employs over 3 000 people and works with international airlines in a highly regulated environment, necessitating world-class quality operation. In the air travel industry, safety is of paramount importance. This requires a very high level of training and strict adherence to procedure. Significant training spend is non-negotiable in our sector. Training investment measured as courses conducted increased by 50% in our ground-handling operation. All training is designed to meet our requirement of “safe, reliable service”.

Our cargo operation successfully implemented a ‘people’s flight plan’ designed to increase investment in all aspects of staff development.

We focused all training efforts internally and ceased providing any training to external parties. Tighter focus and increased spend yielded excellent results.

Bidtravel’s customers are South Africa’s major corporates and government departments and training focuses on ensuring our travel consultants are able to meet customer service expectations and requirements. Budget Rent a Car is primarily end-user facing. Skills and training required for Budget employees include strong emphasis on customer service. Training includes modules such as induction, personal mastery and development, specific skills for specific market segments and adherence to regulatory requirements such as the Consumer Protection Act and Occupational Health and Safety. Training in the travel and car rental industries is essential in order to remain competitive.

The lost-time injury frequency rate increased, partly a result of improved record keeping. We continue to prioritise ongoing safety awareness and training.

The high level of regulation within which Bidair operates leaves relatively little room to manoeuvre in terms of changing practices towards more environmentally friendly methods. We endeavour to reduce idling times of our equipment and maintain it on site where possible to minimise unnecessary transport. Care is taken to dispose of tyres in the most environmentally sensitive manner. To ensure the highest possible levels of safety, regulations require that equipment is used only for a predetermined period before it is replaced.

In our offices, managers are taking the initiative to limit their use of paper and to maximise the proportion of waste that is recycled. Recorded water consumption rose, reflecting more accurate record keeping and the growth of the Bidair Hospitality business. Initiatives are in place to reduce electricity, fuel, paper and water consumption and to recycle paper and tyres in an environmentally responsible manner. All businesses have stepped up these efforts.

Corporate social investment spend increased significantly in line with growth in profit at some companies, and also reflected the introduction of new enterprise development projects.