Super Group invests R2.1bn in acquisitions | Moneyweb | Roy Cokayne |27 August 2019
Super Group invested R2.1 billion in several additions and acquisitions in the year to June to ensure future growth for the JSE-listed transport and mobility group. The group has had a strategy of expanding its international footprint to buffer against the uncertain South African economy and emerging market turmoil. Chief executive Peter Mountford previously said the group did not have a set target for its geographical diversity but would not be uncomfortable at “a 70% non-South African to 30% South African positioning”.
In line with its strategy, several acquisitions were concluded in the year under review. The group acquired an 80% interest in Cargo Works, a specialist overnight cargo business, for R49.5 million in July last year. It also acquired the minority interest in Legend Logistics for R174.5 million, which resulted in this business becoming a wholly-owned subsidiary, while the group’s Dealerships SA business acquired Orbit Motors in October last year for R1.1 million.
Super Group’s effective shareholding in SG Fleet, which has its headquarters in Australia and has operations in New Zealand and the UK, increased to 59.2% from 57% in the year. This was the result of Super Group taking up 3.9 million shares in the dividend reinvestment plan, which amounted to R147.5 million, and purchasing an additional 4.36 million shares for about R106.2 million
After the end of the financial year and effective from July this year, Super Group acquired a 65% interest in Lieben Logistics for R498.8 million and a 51% interest in GLS Supply Chain Equipment for R96.3 million. These acquisitions will form part of the Supply Chain Africa segment. Supply Chain Europe’s inTime logistics company in July this year also acquired an 80% interest in Trans-Logo-Tech for R184.3 million.
Despite these acquisitions, Super Group chief financial officer Colin Brown said the group’s net debt position at end-June was R3 042.3 million, resulting in a net debt-to-equity ratio of 24.1%, an improvement from the 25.1% at end-June last year.
Mountford said they were pleased with the strong financial results achieved by the group in the year to June given the protracted poor economic climate in South Africa and political uncertainties in the various countries in which Super Group operates. He said the strong results were largely attributable to the robust performances in the sub-Saharan commodity-facing businesses but also reflected solid performances by the industrial, technology, ‘digistics’ and vehicle rental businesses in Supply Chain Africa.
Mountford said the Supply Chain Europe operations performed poorly as expected in Germany because of a depressed automotive market and SG Fleet’s performance was also under pressure because of a range of external and legislative changes the businesses within this division had to negotiate during the first half of the year.
He said Fleet Africa secured new full maintenance lease contracts, extended a large existing state-owned enterprise contract and concluded its joint venture agreement with Co-Op Bank in Kenya to end the year in a strong position.
Dealerships SA outperformed the National Association of Automobile Manufacturers of South Africa vehicle sales statistics. And despite ongoing Brexit uncertainty, Dealerships UK delivered a solid performance. Super Group on Monday reported a 6.2% increase in group revenue to R37.9 billion in the year to June from R35.7 billion in the previous year.
Mountford attributed this growth primarily to the significant volume increase in Supply Chain Africa’s businesses. Operating profit increased by 7% to R2.6 billion from R2.4 billion, with the group’s operating margin improving to 6.9% from 6.8%.
Profit before tax rose by 7.3% to R2.26 billion from R2.1 billion. Headline earnings per share increased by 12.5% to 360.8c from 373.8c. No dividend for the year was declared. Mountford said the lack of meaningful economic stimulus in the South African market and the uncertain global macro-events, such as Brexit, US-China trade wars and legislative changes, continue to impact negatively across all geographies in which the group operates.
Despite the tough trading environment, Super Group would continue to maximise and explore business opportunities to unlock shareholder value, he said.
Shares in Super Group rose 3.23% on Monday to close at R28.75.
SAFM Market Update with MoneyWeb 26 August 2019
Super Group achieves strong full-year results | Engineering News | Creamer Media | Online Writer| 26 August 2019
JSE-listed transport logistics and mobility group Super Group achieved strong results for the financial year ended June 30, despite difficult economic climates and political uncertainties in various countries.
CEO Peter Mountford said in a statement on Monday that the sub-Saharan African commodity-facing businesses had delivered robust performances, as had the industrial, technology, Digistics and vehicle rental businesses in the Supply Chain Africa segment. He added, however, that the Supply Chain Europe segment had performed poorly in Germany, on the back of a depressed automotive market. The SG Fleet business’ performance for the year was also under pressure, owing to challenges experienced in the first half of the 2019 calendar year.
The Fleet Africa business ended the year in a strong position, with new full maintenance lease contracts secured and a large existing parastatal contract extension. The Dealerships South Africa business performed above expectation, as did Dealerships UK, despite ongoing Brexit uncertainties.
Super Group concluded several acquisitions in the reporting year. These include an 80% interest in specialist overnight cargo business Cargo Works for nearly R50-million. The company also acquired a minority interest in Legend Logistics for R174-million, which resulted in this businesses becoming a wholly-owned subsidiary.
Dealerships South Africa acquired Orbit Motors for R1.1-million in the reporting year. Further, Super Group increased its shareholding in SG Fleet to 59.2%, from 57%. The company’s operating profit in the reporting year increased by 7% year-on-year to R2.6-billion. Earnings a share increased by 12.5% to 360c apiece, while headline earnings a share increased by 12.5% to 373c apiece.
Following the financial year-end, Super Group acquired a 65% interest in Lieben Logistics and 51% interest in GLS Supply Chain Equipment, effective July 1, for R498-million and R96-million, respectively. These will form part of the Supply Chain Africa segment. Meanwhile, the Supply Chain Europe segment acquired an 80% interest in Trans-Logo-Tech, effective July 5, for R184-million.
Super Group expects market conditions, locally and globally, to remain stagnant throughout the 2020 financial year. The company said it would continue to explore business opportunities, especially in the consumer distribution and freight management logistics environment, as well as product and technology innovation, to unlock shareholder value.
Super Group has been on R800m acquisition spree | Business Report | Edward West | 27 August 2019
CAPE TOWN – Super Group acquired three companies for about R800 million in July, a month after its 2019 year-end, and is seeking further opportunities in spite of the tough trading conditions in many of the markets where it operates, chief financial officer Colin Brown said yesterday. He said in the supply-chain solutions market, companies were closing, going into liquidation or shutting divisions, which was creating opportunities for Super Group to grow its market share, and also possible bolt-on acquisitions.
The transport and logistics group with operations across Southern Africa, Europe and Australia, lifted headline earnings a share 12.5percent to 373.8cents in the year to June 30. Its share price shot up more than 8percent immediately after the results were released yesterday afternoon, but slipped later to close at R28.75. Revenue increased by 6.2 percent to R37.9billion.The gearing ratio improved to 24.1percent from 25.1percent in June 2018.
No dividend was declared. Brown said their capital allocation priorities were firstly to fund organic growth, then to follow acquisitive and other growth opportunities, then to buy back shares in Australia and on the JSE, and then only might dividends be considered, which hadn’t been the case for many years, he said.
The strong performances were attributed mainly to the sub-Saharan commodity-facing businesses. There were also solid performances by the industrial, technology, digistics and vehicle rental businesses in the Supply Chain Africa division. Dealerships in South Africa were under pressure, but outperformed overall national statistics, while dealerships in the UK delivered a solid performance despite the Brexit uncertainty.
Brown said: “With the consumer challenges and falling national car sales in South Africa, a depressed vehicle market and a slightly weaker economy in Germany, and a softening of the vehicle market in Australia, I think we have put up an exceptional performance.”
He said they expected the difficult trading conditions in most of Super Group’s markets for the new financial year, to continue. In particular luxury car sales in South Africa were expected to remain weak; Germany’s vehicle market was expected to be further impacted by the threat of recession and the impact of an emissions testing scandal on the automotive industry.
In July 2019, Super Group acquired a 65percent interest in Lieben Logistics and a 51percent interest in GLS Supply Chain Equipment, from Cape Town, for R498.8m and R96.3m, respectively. In the same month, Supply Chain Europe’s inTime acquired an 80percent interest in Trans-Logo-Tech for R184.3m.
Last July, an 80percent stake in Cargo Works, a specialist overnight cargo business, was bought for R49.5m, while a minority stake in Legend Logistics was acquired for R174.5m. Dealerships SA acquired Orbit Motors effective October 2018.
In the past year the Supply Chain Europe operations had performed poorly in Germany. SG Fleet’s performance for the year was also under pressure as a result of some of the businesses within this division having to negotiate a range of external and legislative challenges.
Group chief executive Peter Mountford said Super Group had invested R2.1bn in net additions and acquisitions through the financial year to ensure the future growth of the group.
Super Group revenue up 6.2% in challenging market | Safm | Nompu Siziba | 26 August 2019
Super Group’s revenue rose by 6%, but the company did not declare a dividend for the last year’s performance. To speak on the company’s latest figures, Dudu Ramela speaks with Peter Mountford, the CEO at Super Group.