The effective operation of our business supports efficient industry supply chains and the relevance and competitiveness of our clients, which in turn drives real economic activity and quality of life through the efficient movement of goods.
Inputs: Financial capital
- Direct access to equity and debt capital markets will attract funding from equity and debt investors, whose investment decisions are influenced by analysts and rating agencies.
- Our ability to generate cash provides us with the liquidity to fund working capital, replacement capex and investment in growth, in balance with stated dividend pay-out guidance.
Inputs: Human and intellectual capital
- Approximately 30 000 employees, whose level of engagement, relevant skills and diverse ideas, determine the efficacy of our client-focused solutions, operational excellence and continuous improvement, and their willingness to align with business plans and a high-performance, entrepreneurial and ethical culture.
- Ensuring that our people can work effectively with the standardised and customised systems and processes being implemented to support competitive differentiation, effectiveness and innovation.
- Our approach to digitisation and innovation aligns to our business strategy, and aims to build a global IT capability that serves our businesses and clients through an appropriate mix of standardised and customised system solutions.
Inputs: Manufactured capital
- The fixed and moveable assets, either owned by Imperial Logistics or by our third-party sub-contractors, according to the optimal asset mix for client requirements, profitability and returns.
- National transport infrastructure and utilities required to operate, particularly roads in Africa and waterways in Europe.
Inputs: Relationship capital
- The quality of our relationships with all stakeholders; specifically, our clients and their customers in the industries in which we operate, and the markets we give them access to, and to which our business partners (specifically sub-contractors) are critical in our ability to deliver to our clients' expectations.
- The quality of our relationships with regulators, governments and local communities in the 38 countries in which we operate, which determines our local relevance, and across all our operations our overall reputation, and protects our commercial and social licences to operate.
Inputs: Natural capital
- The gatekeepers of our natural capital are our multinational clients who insist on proper environmental risk management in the supply of our services, as well as regulators, non-profit organisations and civil society.
Outcomes: Financial capital
- Revenue of R51,4 billion, 53% in Africa and 47% internationally.
- Operating profit of R2,9 billion at a margin of 5,6%.
- Debt/equity ratio of 50% (2017: 122%).
- Free cash flow conversion of 70% to 75% supported by free cash flow of R1,1 billion will support our guideline to distribute a dividend of 45% of headline earnings per share (HEPS).
- Optimal capital structure, including recapitalisation of African Regions business and self-sufficient, comfortably geared balance sheet, with headroom and flexibility to fund organic and acquisitive growth plans.
- Distributed R4,8 billion to providers of capital.
Outcomes: Human and intellectual capital
- The implementation of a common human capital management strategy, which included annual training spend of R166 million (2017: R135 million), and robust controls to ensure safe working conditions for our employees underpin our aspiration to be an employer of preference in our markets.
- Black representation in top management in South Africa – 63% (2017: 55%).
- Road fatalities per million kilometres in Africa down 44,4%. No fatalities in Europe.
- Created wealth per employee of R500 000.
Outcomes: Manufactured capital
- Investment in tangible assets reduced to 45% due to more optimal asset mix.
- Rationalisation of assets supporting long-term profitability included disposal of six non-strategic properties for R367 million.
- Reinvesting R2,6 billion for future expansion.
Outcomes: Relationship capital
- No material instances of non-compliance with laws and regulations.
- Average contract term of top 10 clients – around six years.
- Longstanding client relationships with top 10 clients – relationships span over 33 years on average.
- Introduced net promoter score survey with a good score to core question.
- Achieved a Level 2 broad-based black economic empowerment (B-BBEE) rating on the Road Freight sector codes and a Level 4 B-BBEE rating on the generic dti Codes.
- Sinawe Fund closed three enterprise development deals with high-growth SMMEs in the supply chain.
- Over 260 000 patients assisted with quality affordable primary healthcare through the Unjani Clinics network.
- Distributed R605 million to governments.
Outcomes: Natural capital
- Total scope 1 and 2 CO2 emissions –
- Africa down 4,2%;
- International down 3,3%.
- Water consumption in Africa down 19,7%.
Ethical leadership, governance and corporate citizenship
- Ethical corporate citizenship, which involves many aspects including fair market practices, the elimination of all forms of anti-competitive behaviour and corruption, appropriate remuneration practices, diversity and inclusion as well as community development, is an expectation instilled by the ownership of Imperial Holdings.
- A strong, diverse and independent board, with the expertise and experience relevant to strategy and the operating context within which we operate and strong governance and control principles that comply with King IV and support strategic delivery and our corporate reputation, have been achieved in the process of separation.