Annual Integrated Report 2019

United Kingdom Revenue R33,3bn 2018: R30,3bn 10,1% Product SKU’s (#) 26 768 0% 2018: 26 876 2% Suppliers (#) 2 732 2018: 2 670 A typical Bidfresh customer is: • Food focused • Inspirational and willing to experiment with food • Individually crafted and specialist • Mostly restaurants & caterers but can also exist in other sectors • Driven by experts who demand expert suppliers 2018: 199 021 2018: 1 624 Vehicles (#) 1 631 0% Manufactured capital Manufactured capital 2018: R1,4bn Trading pro t R1,7bn 20,3% Despite “Brexit’’ fatigue in the United Kingdom, revenue rose 10,1% to R33,3 billion (F2018: R30,3 billion) while trading pro t increased by 20,3% to R1,7 billion (F2018: R1,4 billion). Foodservice continues to deliver excellent results, with Bidfresh continuing to make steady progress. Bidfood UK performed strongly, with sales and trading pro t well ahead of F2018. Top-line gains and intense margin management enabled a good performance in view of persistent cost pressures in wages, fuel and energy prices. Business improvement initiatives continue to deliver and ecommerce penetration is growing. The independent and multiple freetrade categories showed solid growth, both in margins and volumes. As expected, National Account volumes fell with our focus on exiting non-pro table business, but margins improved. Our new liquor brand Unity Wines continued to strengthen its market position. Own brand product growth was buoyant and the importing of an exclusive range of brands is developing. Further investment into increased distribution capacity remains a key focus to cater for anticipated growth. The acquisition of Punjab Kitchen, rebranded as Simply Food Solutions (niche ready-meals business), in February 2019 will bolster the UK’s manufacturing capability and value-add products’ offering. An acquisition of a small independent foodservice business was concluded in early July 2019. Bidfresh’s performance was below the previous year, impacted by a “stressed casual dining” customer base. Trading became particularly tough in Q4. Supplier bankruptcies were disruptive. Seafood grew and margins improved. Meat recorded losses, however, these are reducing as the top-line gains scale. Produce struggled to cope with change following its new depot expansion and IT implementation. National Accounts are holding up as customers look for savings but independents face challenges with both drop-size and spend falling. Overall costs were well controlled. Depots 55% Vehicles 39% 6% IT 2019 capex Capex investment 2019 R587,6m 2018: R682,9m See: AFS, Note 7.1 page 112 Financial capital Financial capital Ten year anniversary of Safari customer loyalty programme, Bidfood UK. Reducing miles by staying local Many businesses consolidate and centralise operations but we love to ‘stay local’. We know this improves customer service because customers value the personal contact with our award-winning telesales teams. Our emphasis on staying local also means we are closer to our customers, reduces mileage to their sites, meaning fewer vehicles on the roads, lower mileage, reduced emissions, and provides local employment opportunities. 97% of our customers are within 80 miles of a depot, and the average distance for a customer is 26 miles. Depots ( m 2 ) 209 441 5% Hardware* R34,2m Software R52,2m R86,4m 23% Investment in IT * Hardware includes IT and of ce equipment. 38 / Bid Corporation Limited Annual integrated report 2019