Annual Integrated Report 2019

Chairman’s statement I am confident that Bidcorp, with its strong entrepreneurial culture and resources, is a resilient business that can sustain growth despite the geopolitical and economic challenges facing the global market. In an environment of global volatility and market uncertainty, Bidcorp has continued to improve market share, earnings and cash ow; while maintaining low debt levels and a strong balance sheet. This pleasing performance is testament to the resilience of Bidcorp’s decentralised business model, which is premised on international diversi cation across multiple segments and underpinned by a strong service and ef ciency ethic. Global environment: steady but slowing Global economic con dence is weakening. Reports of a US-China trade war, rising nationalism, as well as the resurgence of protectionist trade barriers are weighing down economies around the world. Further shocks could trigger a global downturn. Multi-national businesses must therefore carefully navigate ever more turbulent markets, where short-term populist politics, tariffs, anti-globalisation backlashes, and possible supply chain and market access restrictions could constrain the free movement of goods. For now, however, the global economy remains steady, albeit slowing. In light of these geopolitical challenges, at Bidcorp we continue to focus our attention where we can make a difference: namely, on engaging our most critical stakeholders on a common vision around food quality, sustainability, service and technology. Key is our decentralised business model. By empowering leadership to retain substantial autonomy on matters that relate to the business in their speci c region, we can identify and respond to rapidly changing market conditions. Given persistent geopolitical and economic uncertainties, we are closely monitoring developments in the UK, Hong Kong, parts of Europe, Brazil and South Africa. Strong FY2019 performance Bidcorp scaled new heights in 2019. Revenue was up 4,7%, trading pro t was 7,1% higher and headline earnings per share grew 7,7%, all in constant currency. Headline earnings per share increased by 12,5% and basic earnings per share increasing by 14,8% in rands. Rewarding shareholders remained a priority, with the company declaring a nal cash dividend of 330 cents per share, giving a total dividend for the 2019 nancial year of 640 cents per share – a 14,3% increase on the total dividend paid last year. This performance was achieved with only a minor contribution from last year’s acquisitions, a low food in ation environment, labour and energy cost pressures, and the exit of low margin businesses. The United Kingdom, Europe and Australasia drove pro t growth, while several Emerging Market territories also delivered commendable performances. Our focus remains on capitalising on organic and acquisitive opportunities to expand market share and turnaround programmes for underperforming areas. People and culture Since assuming the chairman role from Brian Joffe last year, I have seen Bidcorp’s people in action: driving innovation, customer friendly solutions and service excellence. These are the values that will continue to keep us nimble and relevant. While we are proud of the success of our geographic and product diversi cation, at our core we remain a people organisation. Understanding that the vitality of our teams around the world are key factors behind the performance of our group we have a continual programme of skills and talent development. While decentralisation is our management philosophy, we embrace shared learnings between regions. This year we also enhanced our investments in ecommerce and IT and accelerated intergroup procurement opportunities. Responsibility and governance Over the past three decades, Bidcorp has grown to become a substantial global foodservice business with operations in over 35 countries and employing 25 858 people across Africa, South America, the UK, Europe, Asia and Australasia. Since listing on the JSE in May 2016, Bidcorp has seen its market capitalisation grow to in excess of R112 billion. As a board we recognise that an organisation of this scale has broader responsibilities to society. Much work is going into ensuring local relevance, 2 / Bid Corporation Limited Annual integrated r eport 2019