20 / 170
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Headline earnings per share up 32,5% at 1 080,0 cents per share
■
Revenue grows by 20,8% to R140,5 billion
■
Gross profit percentage rises to 20,8%
■
Group trading profit up by 26,1% to R5,2 billion with a trading margin of 3,7%
■
Net finance charges fall 11,1% to R294,6 million
■
Headline earnings move 32,7% higher to R3,6 billion
■
Net debt falls to R1,7 billion
■
Cash generated by operations extremely robust
■
Dividend of 241,0 cents per share declared
Based on pro forma financial information
David Cleasby
Chief financial officer’s report
Overview
In spite of tough international market trends, trading performance was
excellent and cash generation remained strong. Generally, international
interest and growth rates remained low and flat, with an increased risk
of food deflation in some markets.
Solid performances by teams in Australia, New Zealand, UK
Foodservice, Czech Republic, South Africa and China contributed to
healthy cash generation and gains in market share. The result was
notable for solid organic rather than acquisitive growth.
Volatile markets
Throughout the financial year, markets remained volatile in view
of concerns about the effects of negative interest rates in several
important jurisdictions, the slowing Chinese economy and Chinese
debt levels, depressed commodity prices and volumes, sluggish
recovery in many parts of the world and the impacts of central bank
stimulus in Japan and the Eurozone.
Acts of terror and political and economic crises in a number of
geographies added to nervousness. Meanwhile, the IMF repeatedly cut
its world growth forecasts.
Despite these uncertainties, Bidcorp’s management teams remained
focused and delivered impressive gains.
Exchange rates
A significant market event like Brexit contributed to volatility in all
foreign exchange markets, exposing mismatched corporate asset and
liability positions. At Bidcorp, a fundamental risk mitigation strategy
is to match both assets and liabilities in their respective currencies in
order to avoid a mismatch of this nature and thereby protect Bidcorp’s
financial position.
In addition, each business is managed and performance evaluated
in its home currency relative to local conditions. Results are then
translated into rand, Bidcorp’s functional reporting currency. The
translation benefited the overall Bidcorp result in the financial year.
The average rand exchange rate weakened against the basket of
Bidcorp currencies. The net result, excluding currency effects, was a
pleasing 14,2% gain in profit attributable to shareholders.
Bidcorp listing
The financial community, local and international, reacted positively to
our listing and unbundling and the emergence of Bidcorp as a member
of the JSE’s “Food Retailers and Wholesalers” sector.
Page 16
| Bidcorp Limited Annual integrated report 2016