Investment case
Bidvest is a diversified Group spanning most of South Africa's economy. Many of our products and services are essential and, therefore, derive defensive income. Focus on cash generation and returns are deeply rooted.
Strategy has driven significant shifts over the past three years:
Profit mix has shifted towards annuity income
Trading margin and distribution gross margin increased
Capital and cash generated have been directed from non-core assets to internationalising niche services and greater annuity income streams
Returns have remained good. ROIC well above weighted cost of capital
Sustainability and stewardship initiatives progressed
| Margins improved and mix richer % |
Economic value created % |
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| * | Annuity income are mainly service and property related activities |
| ** | Wholesale and distribution relates to training activities in Office and Print, Commercial products, Electrical and Automotive |
| Cumalitive cash in-flow and out-flow (FY16 – 19) Rm |
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Distinctive characteristics:
Blended portfolio of defensive, cyclical and growth assets
Cash generative businesses that are relatively capital light
Highly entrepreneurial and decentralised management teams supported by lean corporate office
31 years of consistent trading profit outperformance
Strong track record of efficient capital allocation
Proven ability to quickly execute and assimilate acquisitions
Highly regarded brands
Embrace change through innovation
Positioned for international expansion in chosen niche areas
Aim for market leadership in operating sphere
| Operational RoFE 28%; ROIC 23% (10yr average)*
% |
Trading profit +10%; Free cash flow +8% (10yr CAGR)* |
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| * | Data prior to 2016 refer to Bidvest South Africa only |