Imperial produced solid results and recorded an improvement in all key financial metrics in the
12 months to 30 June 2018, supported by acquisitions, increased vehicle sales and a good
performance from Motus. Imperial Logistics performed satisfactorily in mixed trading conditions.
Excluding businesses held for sale, total revenue and operating profit for the group increased by
13% and 7% respectively.
Excluding current and prior period acquisitions and disposals, total revenue and operating profit
for the group increased by 5% and 2% respectively.
Operating margin declined to 5,0% from 5,2%, resulting from a reduction in sales of luxury
vehicle brands in favour of smaller, lower-margin entry-level vehicles, and the acquisition by
Motus of the lower-margin Pentagon (UK) and SWT (Australia).
Revenue generated outside South Africa increased 21% to R59,0 billion (45% of group revenue)
and operating profit generated outside South Africa increased 6% to R2,4 billion (37% of group
A full reconciliation from earnings to headline earnings is provided in the group financial
performance section. As reported at the interim results, core earnings is no longer a relevant
financial measure and was discontinued in the 2018 financial year.
Net working capital of R8,8 billion improved by 2% from R9,0 billion in June 2017. Imperial
Logistics working capital increased by R1,5 billion as debtor and creditor levels normalised to
more sustainable levels when compared to F2017. The acquisitions, mainly Surgipharm, also
impacted working capital in F2018. Motus working capital decreased by R1,7 billion mainly due
to a reduction in inventory and improved supplier credit terms. We expect inventory levels to
normalise in H1 F2019. Detailed commentary.