Imperial Holdings Limited - Integrated Report 2013

Integrated Report 2013

Annual Financial Statements 2013

Sustainability Report 2013



	Definitions	2013 Rm	2012 Rm	2011 Rm	2010 Rm	2009 Rm

Extracts from profit or loss
Revenue		92 382	80 830	64 667	53 438	52 219
Operating profit		6 087	5 638	4 526	3 288	2 453
Net financing costs		(744)	(681)	(554)	(597)	(923 )
Income from associates and joint ventures		86	46	34	174	107
Income tax expense		(1 404)	(1 382)	(1 272)	(911)	(502 )
Tax rate (%)		28,1	29,3	30,7	31,0	32,1
Profits attributable to non-controlling interest		(392)	(408)	(346)	(241)	(160 )
Headline earnings attributable to ordinary shareholders (excluding discontinued)		3 456	3 007	2 608	1 811	1 294
Headline earnings attributable to ordinary shareholders (including discontinued)		3 456	3 007	2 608	1 841	1 327
Extracts from cash flow statement
Cash generated by operations (before capital expenditure on vehicles for hire,
net interest paid and tax paid)		7 191	7 440	6 077	4 376	4 649
Cash flow from investing activities (including capital expenditure on vehicles for hire)		(4 708)	(4 230)	(1 931)	(1 883)	(1 276 )
Net debt repaid/(raised) (including discontinued)		(2 250)	(625)	959	250	3 108
Free cash flow (including discontinued)	1.	3 658	3 770	3 452	2 190	3 016
Extracts from statement of financial position
Total assets (including discontinued operations)		51 636	45 698	36 533	34 223	33 315
Total assets (excluding discontinued operations)		51 636	45 698	36 533	32 999	32 365
Operating assets	2.	48 443	41 575	32 815	29 506	28 677
Operating liabilities	3.	20 917	18 046	14 495	12 750	11 107
Net working capital	4.	6 158	4 606	3 245	2 882	2 693
Net interest-bearing debt	5.	9 165	6 642	4 418	5 075	5 580
Imperial owners? shareholders interest		16 413	14 666	11 974	11 140	9 774
Non-controlling interest		1 300	1 223	1 043	806	587
Contingent liabilities		294	46	61	201	256
Ratios
Efficiency
Revenue to average net operating assets (times)	6.	3,6	3,9	3,7	3,1	2,9
Revenue relating to sales of goods to average inventory (times)	7.	5,1	5,6	5,3	4,9	4,6
Revenue to average net working capital (times)		17,2	20,6	21,1	19,2	15,2
Profitability<
Operating profit to average net operating assets (%)	8.	23,8	26,9	25,8	19,2	13,7
Operating profit to average gross operating assets (%)		13,5	15,2	14,5	11,3	8,3
Operating margin (%)	9.	6,6	7,0	7,0	6,2	4,7
Return on average ordinary shareholders' interest (%)	10.	21,2	22,4	22,2	19,3	15,7
Return on average ordinary shareholders? interest (based on core earnings) (%)	11.	23,0	23,4	20,3	17,1	9,4
Return on invested capital (%)	12.	16,2	16,3	16,5	12,2	11,5
Weighted average cost of capital (%)	13.	8,8	9,7	10,1	10,5	10,9
Solvency
Interest cover by operating profit (times)		8,2	8,3	8,2	5,5	2,7
Net debt to EBITDA (times) (including preference shares)		1,1	0,9	0,7	1,1	1,5
Total equity to total assets excluding discontinued (%)		34,3	34,8	35,6	34,9	32,0
Net interest-bearing debt as a % of total equity		51,7	41,8	33,9	42,5	53,9
Liquidity
Free cash flow to net profit for the year (including discontinued) (times)		0,99	1,11	1,19	0,97	1,80
Free cash flow to headline earnings (including discontinued) (times)	14.	1,06	1,25	1,32	1,19	2,27
Unutilised facilities		5 880	6 045	8 000	6 358	10 209
Investing in the future
Cost of new acquisitions		666	1 886	943	389	351
Expansion capital expenditure		1 682	1 125	687	963	640
Net replacement capital expenditure		1 395	1 467	841	830	1 037
Staff training hours		1 436 520	1 306 135	1 379 615	935 945	325 943
Capital commitments		935	1 112	1 007	882	544
Statistics
Total new and used vehicles and motorcycles sold		206 462	198 131	168 661	149 247	126 355
Number of transport fleet vehicles		6 431	6 312	6 030	6 559	6 774
Number of vehicles for hire (car rental only)		17 602	16 599	17 026	18 015	14 792
Number of employees		51 007	47 699	40 898	35 968	34 353
Staff costs		12 824	10 703	8 713	7 515	7 236
Wealth created per employee		412	380	360	339	320
Total taxes and levies paid	15.	1 438	1 572	1 543	1 054	706
Share performance
Headline earnings per share (cents)		1 804	1 566	1 370	976	698
Core earnings per share (cents)		1 871	1 623	1 234	962	491
Dividends per share (cents)		820	680	480	350	200
Earnings yield (%)	16.	8,6	9,1	11,3	11,4	12,0
Price earnings ratio (times)	17.	11,6	11,0	8,9	8,8	8,4
Dividends yield (%)		3,9	4,0	4,0	4,1	3,4
Net asset value per share (cents)	18.	8 413	7 479	6 137	5 529	4 820
Market prices (cents)
- closing		20 968	17 200	12 125	8 580	5 830
- high		22 600	17 729	13 245	10 750	6 700
- low		17 150	9 420	8 450	5 650	3 957
Total market capitalisation at closing prices	19.	43 788	36 093	25 320	18 095	12 367
Value of shares traded		51 766	30 099	26 937	22 964	14 258
Value traded as a percentage of average capitalisation (%)		130	98	124	151	121
Exchange rates used
Rand to Euro
- Average		11,42909	10,37628	9,49383	10,59240	12,34965
- Closing		13,03760	10,39350	9,55000	9,39390	10,87650
Rand to US Dollar
- Average		8,83540	7,75379	7,06489	7,59948	9,05373
- Closing		10,00580	8,20000	6,70000	7,65850	7,73490
Rand to Botswana Pula
- Average		1,08803	1,05177	1,07226	1,13700	1,24012
- Closing		1,16266	1,07170	1,03200	1,08329	1,14941
Rand to Australian Dollars
- Average		9,06051	7,99178	6,80385	6,70843	6,66988
- Closing		9,01180	8,40150	6,56600	6,55590	6,34330

Definitions

1.	Free cash flow – calculated by adjusting the cash flow from operating activities to exclude the expansion capital expenditure on rental assets and deducting replacement capital expenditure on other assets.
2.	Operating assets – total assets less loans receivable, tax assets, cash resources and assets held for sale.
3.	Operating liabilities – total liabilities less interest-bearing borrowings, tax liabilities and liabilities directly associated to assets classified as held for sale.
4.	Net working capital – consists of inventories, trade and other receivables, provisions for liabilities and other charges and trade and other payables
5.	Net interest-bearing debt – interest-bearing borrowings plus non-redeemable preference shares less cash resources.
6.	Revenue to average net operating assets (times) – calculated by dividing revenue by average of opening and closing net operating assets (operating assets less operating liabilities per segment report).
7.	Revenue relating to sales of goods to average inventory (times) – revenue relating to sales of goods divided by average of opening and closing inventory.
8.	Operating profit to average net operating assets (%) – operating profit divided by average of opening and closing net operating assets.
9.	Operating margin (%) – operating profit divided by revenue.
10.	Return on average ordinary shareholders’ interest (%) – net profit attributable to owners of Imperial divided by average equity attributable to owners of Imperial (using the opening and closing balances).
11.	Return on average ordinary shareholders’ interest (core) (%) – core earnings divided by average equity attributable to owners of Imperial increased by the cumulative core earnings adjustments (using the opening and closing balances).
12.	Return on invested capital (%) – return divided by invested capital. Return is calculated using profit after tax and non-controlling interest, increased by the after-tax effects of net finance and exceptional items. Invested capital is a 13-month average of equity attributable to owners of Imperial plus preference shares plus debt (interest-bearing borrowings long term and short term minus long-term loans receivable) minus non-financial services cash resources
13.	Weighted average cost of capital (%) – calculated by multiplying the cost of each capital component by its proportional weight and then summing, therefore: WACC = (after tax cost of debt % X debt weighting) plus (cost of equity multiplied by average equity weighti
14.	Free cash flow to headline earnings ratio – free cash flow divided by headline earnings.
15.	Total taxes and levies paid – made up of SA normal taxation, secondary tax on companies, foreign taxation, rates and taxes, skills development and unemployment insurance fund levies.
16.	Earnings yield (%) – the headline earnings per share divided by the closing price of a share.
17.	Price earnings ratio (times) – the closing price of a share divided by the headline earnings per share.
18.	Net asset value per share – equity attributable to owners of Imperial excluding non-controlling interest divided by total ordinary and preferred ordinary shares in issue net of shares repurchased. (The deferred ordinary shares only participate to the extent of their par value of 0,04 cents.)
19.	Total market capitalisation at closing prices (Rm) – total ordinary shares in issue before treasury shares multiplied by the closing price per share.

Five-year review