Management approach disclosures

Overall

Economic performance

Financial highlights included:

Revenue (Rm): 62 101
EBITDA (Rm):6 170
Operating profit (Rm):3 830
Headline earnings per share (cents):857
Profit before tax (Rm): 2 530
Profit after tax (Rm): 1 693
Net profit (Rm): 1 910
Total assets (Rm):  44 006
Cash generated from operations (Rm): 2 953
Ordinary dividend (cents): (full year) 320

In terms of its value-based management approach, Barloworld is committed to creating value for all stakeholders. Equally the group recognises that sustainability includes balancing the interests of all stakeholders. Direct economic value created for stakeholders is reflected in the Statement of Total Value Added, and should be considered with our corporate social investment and enterprise development initiatives.

Responsibility is at operational, executive and board level with clear objectives and parameters in place. Internally these are monitored and reported monthly and inform management decision making. Externally direct economic impacts are reported twice during a financial year, at interim results (March) and the final results (September). This aspect is covered extensively in the group’s annual integrated reporting which includes detailed financial reporting together with external assurance. The group has developed an Integrated Financial Value Model that highlights the operational and financial value drivers that are key to leveraging returns and optimising financial performance within our business.

Barloworld creates significant value for local suppliers, which includes OEMs and sub-contractors. This is reduced where plant and equipment can only be sourced from offshore principals, in which case we aim to spend the balance locally. This principally benefits communities in South Africa, as do our preferential procurement initiatives under the B-BBEE umbrella.

The value-added statement is designed to give the reader a full but concise understanding of how the group enhances its economic impacts in the regions where it operates.

Refer to Statement of total value added

Refer to Financials statements

Market presence

Specific industries in which we operate include: mining; construction; oil and gas; forestry; power, including efficiency as well as turnkey solutions in the electrical power generation, marine transport, petroleum, industrial and rail segments; long and short-term vehicle; equipment and plant rental; distribution of vehicles, plant and equipment; agriculture; logistics management and supply chain optimisation.

Customer segments include: corporates; individuals; state; state owned enterprises; local utilities and municipalities; wholesale and retail; warehousing; ports and harbours.

The group creates value by:

Providing flexible, value adding, integrated business solutions to our customers backed by leading global brands in the following business segments:
 
° Equipment (earthmoving and power systems)
° Handling (forklift and truck distribution, materials handling, agricultural equipment, Metso crushers and SEM)
° Automotive (car rental, motor retail, fleet services, used vehicles and disposal solutions)
° Logistics (logistics management and supply chain optimisation)
Representing leading global brands supported by Barloworld’s service excellence
Effectively managing our long-term relationships with global principals and customers.

The group’s exposure to the mining, infrastructure, power, agriculture, automotive and logistics sectors with  long-term growth potential particularly in emerging markets, together with the principals, OEMs and brand that it represents and areas of activity, ensure the group is well positioned for growth.

The group operates in  24 countries.

Barloworld Equipment & Handling: Andorra, Angola, Botswana, Cape Verde, China, Democratic Republic of the Congo, Lesotho, Malawi, Mozambique, Namibia, Portugal, Russia, São Tomé and Principé, South Africa, Spain, Swaziland,  United Kingdom, Zambia and Zimbabwe.

Barloworld Automotive and Logistics: Botswana, , Germany, Ghana, Lesotho, Mozambique, Namibia, Portugal, South Africa, Spain, Swaziland, Tanzania, United Arab Emirates, United Kingdom, United States of America, Zambia and Zimbabwe

Indirect economic impacts

Indirect economic impacts include: employee spending, providing products and services, enhancing the image and reputation of areas, skills development and job creation that reduces demand on the fiscus and enables resources to be redirected elsewhere.

The group’s corporate social investment initiatives contribute to the social wage and its enterprise and socio-economic development investments create employment opportunities and increase overall economic output. Barloworld has a number of initiatives designed to bring previously disadvantaged people into the formal South African economy and its Siyakhula fund supports emerging black-owned enterprises by nurturing them into fully fledged businesses.