Bidvest AR 2007 · highly aesthetic in its form and execution. Pilobolus is unlike any other contemporary ... exchange services, oﬃ ce automation, supply chain integration, e-procurement

The Bidvest Group LimitedAnnual report 2007

infi nite possibilities...www.bidvest.com

The B

idvest G

roup Lim

ited A

nn

ual report 2007

Pilobolus “Pilobolus is a sun-loving fungus (phototropic zygomycete) that grows in barnyards and pastures. It grows on a stalk as a small bladder, pressurised by cell sap and topped with a tiny black cap fi lled with spores. When time and Pilobolus are ripe, this entire sporangium is blasted off with incredible force and the little spore bags reach an acceleration from zero to 70 kilometres per hour in the fi rst millimetre of fl ight – the second fastest in nature.

Pilobolus the “arts organism”, is an internationally renowned dance company that has mesmerised audiences all over the world with their gravity defying choreography. Drawing on a variety of physical disciplines such as gymnastics and acrobatics, the company has developed an entirely new dance vocabulary that is both athletic and highly aesthetic in its form and execution. Pilobolus is unlike any other contemporary dance company.

With Pilobolus you can expect the unexpected. Bodies fearlessly intertwine and balance on each other; dancers fl y through the air or tumble gracefully into body formations which are magical, humorous and genial. This requires extraordinary strength, skill, trust and remarkable creative thinking.

The creation of such work is rooted in a collaborative inspiration drawn from the entire company. The choreographer creates a space in which an artistic collective comes to play, new forms and movements are constantly invented and dancers are inspired to create something extraordinary, from the ordinary.

These are qualities which characterise the spirit we call “Proudly Bidvest”.

...when Bidvest people take on a challenge

We’re an international services, trading and distribution company,

listed on the JSE, South Africa

and operating on four continents.

We employ more than 104 000 people worldwide,

but our roots remain South African.

In a big business environment we run our company

with the determination and commitment evident in a small business heart.

We believe in empowering people, building relationships and improving lives.

Entrepreneurship, incentivisation, decentralised management and communication are the keys.

We subscribe to a philosophy of transparency, accountability, integrity, excellence and innovation in all our business dealings.

We turn ordinary companies into extraordinary performers, delivering strong and consistent shareholder returns in the process.

But most importantly, we understand that people create wealth,

and that companies only report it.

Contents

Financial highlights and results 1

Our Group in brief 2

Consolidated segmental analysis 6

Performance at a glance 9

External appraisals 13

Global footprint 14

Directorate 16

Chairman’s statement 22

Chief executive’s report 28

Financial director’s report 36

Review of operations

■ Corporate Services 44

■ Bidfreight 48

■ Bidserv 56

■ Bidvest Asia Pacific 64

■ Bidvest Europe 70

■ Bidfood 78

■ Bid Industrial and Commercial Products 84

■ Bidpaper Plus 92

■ Bid Auto 100

Summarised sustainability report 110

Corporate governance 116

Financial statements 125

Shareholders 192

Management directory 194

Shareholders’ diary 208

Administration 208

Glossary 209

this symbol indicates that further detailed information is available

This annual report should be read in conjunction with

The Bidvest Group Limited Sustainability report 2007

2007

R’000

2006

R’000

Revenue 95 655 509 77 276 491

Gross income 18 324 691 15 469 264

Trading profi t 4 546 784 3 657 000

Profi t for the year 2 787 156 2 464 543

Headline earnings per share (cents) 970,0 804,6

Distributions per share (cents) 446,4 369,0

The graph represents Bidvest’s share price performance relative to indices which have been adjusted to give a more meaningful comparison to that of its peer group. A major constituent of the indices, Richemont Securities AG, has been excluded from the adjusted indices as its business is off shore and in completely diff erent markets.

Market capitalisation as at June 30 2007 was R48,4 billion (R42,8 billion net of treasury shares)

R1 000 invested at the start of Bidvest, capital and dividend distributions re-invested, would have been worth an estimated R468 692, a return of 33,4% per year.

— Bidvest relative to adjusted financial and industrial index— Bidvest relative to adjusted industrial index

3,53,02,52,01,51,00,5

0

Jan95

Jan96

Jan97

Jan98

Share price performance

Bidvest acknowledges the contribution of 104 184 employees around the world, who turn ordinary companies into extraordinary performers.

Revenue up

24% to R95,7 billion

Trading profit up

24% to R4,5 billion

Headline earnings per share up

21% to 970,0 cents

Basic earnings per share up

13% to 899,4 cents

Distribution per share up

21% to 446,4 cents

Feb99

Feb00

Feb01

Mar02

Mar03

Mar04

Apr05

Apr06

Apr07

Consolidated results

Financial highlights and results

1The Bidvest Group Limited Annual report 2007

The Bidvest Group Limited Annual report 20072

Description of business Incorporating

The Group’s corporate offi ce, based in Melrose Arch, Johannesburg, provides strategic direction and services to the Group, houses investments, adding value through identifying opportunities and implementing Bidvest’s decentralised and entrepreneurial business model.

› Bid Corporate Services › Bid Property Holdings› Namibian Fishing › Ontime Automotive

The leading private sector freight management group in sub-Saharan Africa, consisting of several independent businesses focusing on freight terminals, international clearing and forwarding, logistics and marine services.

› Bulk Connections › Island View Storage › Bidfreight Port Operations › Rennies Distribution Services › SACD Freight › South African Bulk Terminals › Naval › Safcor Panalpina › Marine Services › Manica Africa

Off ers a full range of outsourced services including cleaning, laundry, hygiene, security, interior and exterior landscaping, aviation services, janitorial products, industrial workwear, travel, banking and foreign exchange services, offi ce automation, supply chain integration, e-procurement and online travel.

› Prestige Cleaning Services › TMS Group Industrial Services › Laundry Services › Steiner Group › Bidserv Industrial Products › Green Services › Aviation Services › Bidrisk Solutions › Global Payment Technologies › Business Solutions and

Group Procurement › Offi ce Automation › Bidtravel › Banking Services › Foreign Exchange Services › Hotel Amenities and Accessories

Comprises leading foodservice product distributors in the United Kingdom, Belgium, the Netherlands and the United Arab Emirates, providing products, quality ingredients, fi nished products and equipment to the catering industry.

› 3663 First for Foodservice – United Kingdom › Deli XL – Belgium › Deli XL – Netherlands › Horeca Trade – United Arab Emirates

Comprises Bidvest Australia, Bidvest New Zealand, Angliss Singapore and Angliss Hong Kong and China. Bidvest leads the foodservice industry and off ers a full end-to-end national distribution service.

› Bidvest Australia › Bidvest New Zealand › Angliss Singapore › Angliss Hong Kong and China

A leading multi-range manufacturer and distributor of food products and ingredients. Bidfood operates through strategically located independent business units in southern Africa, aimed at servicing the catering, hospitality, leisure, bakery, poultry, meat and food processing industries.

› Caterplus › Bidfood Ingredients › Speciality

A leading manufacturer and distributor of electrical products, appliances and services, offi ce stationery, offi ce furniture, packaging closures and catering equipment in southern Africa and the United Kingdom.

› Voltex Electrical Distribution › Berzack › Eastman Staples › Catering Equipment › Stationery › Offi ce Furniture › Packaging Closures

A leading manufacturer, supplier and distributor of commercial offi ce products, printer products, services and stationery and packaging products, through a wide network of outlets in southern Africa.

› Printing and Related › Stationery Distribution› Alternative Products › Packaging and Label Products

One of South Africa’s largest motor vehicle retailing and service groups. Bid Auto off ers leading motor brands through over 130 dealerships and service outlets, backed by fi nancial and fl eet services, a loyalty programme and the country’s leading online retailer of new and pre-owned vehicles.

› McCarthy Motor Holdings › Import and Distribution › Financial Services › Car and Van Rental › Support Services

An international services, trading and distribution company, listed on the JSE, South Africa, operating on four continents and employing over 104 000 people worldwide.

Southern Africa

United Kingdom and continental EuropeAsia Pacifi c

Bidvest – Our Group in brief

Corporate Services

Bidfreight

Bidfood

Bidvest Europe

Bid Industrial and Commercial Products

Bidpaper Plus

Bid Auto

The Bidvest Group Limited

Bidserv

Bidvest Asia Pacifi c

Revenue Tra

Operational highlights Prospects R’000Proportion

%Growth

% R’000

Bricks and mortarAt Bid Property Holdings the development of a high-quality portfolio helped to retain control over strategic operational properties. Ontime Automotive recorded a small loss. Horse mackerel and pilchard fishing assets in Namibia recorded a 6% rise in profits to R80m. 20% of the equity of JSE-listed airline group Comair, was acquired.

South Africa still enjoying sustained GDP growth, anticipated to continue beyond 2010 world cup. Tightening credit conditions and rising local infl ation will focus management’s attention on rigorous cost containment and asset management. Listing of Bidvest Namibia in April 2008.

1 477 364 1,5 14,0 203 230

A tightening of the lanyard20% increase in revenue to R19bn. Good revenue gains but margins tighter due to customer pricing pressure and poor product volumes. Cost management and efficiency gains focus areas. Slow progress in expansion of ports infrastructure.

Improved agricultural volumes and ongoing benefi ts of capex. Manica Namibia incorporated with Bidvest Namibia (July 1 2007). IVS expansion priority; SACD to construct new Cape Town facility and expand Johannesburg; new silos at SABT; Marine approaching Liner principals seeking SA representation; Bulk increasing manganese ore and imported coke volumes.

18 994 985 19,5 20,3 596 352

Organic produceProfits driven organically. Increased ownership of Master Currency to 100% (July 2007) with Hotel Amenities Suppliers (ex-Bidfood) joining the division. Bidrisk Solutions affected by aftermath of the strike. Bidtravel Services produced outstanding performance. TMS profits up 62%, Topturf up 65%.

Benefi ts realised from contracts won in F2007; turnaround in Security; Bidvest Bank, primarily a forex bank with ongoing focus on niche corporate lending, asset fi nance and corporate cards; fi nancial services viewed as a strategic opportunity. Excellent prospects for Bidair. Corporate demand remains strong for outsourced solutions.

5 393 090 5,5 16,2 669 411

Bit of a poundingTrading profits up 16% to R758m, with a pleasing progress from Deli XL Belgium which benefited from management changes. Tactical repositioning in United Kingdom and bad debts lead to temporary shortfall against budget. 6% sales growth despite loss of the Ministry of Defence contract. Horeca Trade doubled size of its business in 18 months.

Benefi ts from repositioning of United Kingdom sales force expected in F2008. Sixteenth year of sustained expansion means United Kingdom remains top performing large economy. Renewed growth in revenue and trading profi t targeted.

29 962 516 30,7 35,4 757 551

Eyeing the OrientAustralia and New Zealand an impressive performance with Australia holding an estimated 20% of the foodservice market. New Zealand grew trading profi t by 23% and revenue increased by 19%. Angliss acquisition creates exposure to Asia’s fastest growing markets.

Further strong momentum in Australia and New Zealand; including the fi rst full year contribution from Angliss. Synergies in Angliss to be pursued as opportunity to build market knowledge from established base.

8 863 650 9,1 36,2 346 554

Accomplished CaterplusImpressive 22% growth from Caterplus; Bidfood Ingredients down 15% in a challenging market. Speciality excelled with Patleys growing revenue by 29% and profi ts by 32% Crown National outperformed with profi ts up 27%.

Benefi ts from re-organisation in South Africa (particularly Bidfood Ingredients). Bidfood Technologies encompasses Crown and Chipkins. Potential to be derived from single management team for Caterplus.

3 845 772 3,9 15,0 279 814

Wondrous wattagePleasing growth with profi t up 49% and revenue increased by 24%. Voltex’s wholesale and specialist supply business performed strongly with revenue rising by 37% and profi ts by 66%. Structural changes, off shore sourcing and new distribution agreements ensured packaging business enjoyed increasing demand.

Infrastructure spend and growth in corporate South Africa coming through strongly. Suitable acquisitions being actively sought. Double digit growth budgeted for in F2008. Opportunities exist for the export of patented and strong branded products.

8 565 131 8,8 23,8 742 670

New tech horizonsContinuing demand for traditional off ering successfully complemented by electronic innovation. Revenue fl at on continuing operations while trading profi t rose 17% to R227m. Growth in line with expectations as 2006 sales boosted by large election materials contracts in Lithotech. High levels of retail activity proved positive. Exports division won contract to supply ballot papers for Nigerian election.

An energised focus on capitalising on effi ciency gains following consolidation phase in F2007. Extension of traditional and new technology product range through market share gains and acquisition. E-commerce solutions remain a focal point in future growth and retention of leading market position.

1 823 822 1,9 (13,5) 226 899

Travelling a Scenic RouteLike-for-like profi t growth of 20%; motor retail now constitutes less than 50% due to diversifi cation; R40m write-off on Gaz. Acquisition of Shell AutoServ facilitated growth in parts and service business. Launch of Chinese range of light commercial vehicles strengthened import and distribution business.

Estimated once-off >R50m negative impact of National Credit Act and slowdown in auto sales in F2008; reduced customer aff ordability remains a challenge; positive eff ect of effi cient funding of R974m Viamax acquisition at a R36m premium to NAV (eff ective 1/9/07) and fi rst earnings contribution.

18 689 283 19,1 15,4 724 303

Infi nite possibilitiesPleasing overall performance in more challenging economies; signifi cant market share gains; Dinatla refi nancing and alignment with BBBEE codes; acquisition of Angliss; reorganisation of Bidfood management; creation of Bidvest Namibia; commencement of development of Bidvest brand name; successful R1,5 billion bond issue; 10 000 more jobs created; Bidvest Academy a tool for development of executive and managerial talent; succession generation.

High interest rates with slower consumer spending; higher average infl ation; infrastructure spend continuing to gain momentum; focus on working capital management and rigorous cost containment; change in private equity environment seen as opportunity; benefi ts of group-wide capex yet to be fully realised.

97 615 613 100,0 23,7 4 546 784

57 708 227 59,1 17,5 3 448 077

31 043 736 31,8 33,3 752 153

8 863 650 9,1 36,2 346 554



ading income Funds employed EmployeesEmployee benefi ts and

remuneration

Proportion%

Growth% R’000

Proportion%

Growth% Number

Proportion%

Growth% R’000

Proportion%

Growth%

4,5 87,5 2 135 600 20,0 33,0 1 832 1,7 7,4 500 521 5,0 18,0

13,1 11,2 129 357 1,2 (175,9) 5 497 5,3 3,1 782 273 7,8 6,8

14,7 19,0 1 064 671 10,0 24,0 62 258 59,7 13,8 2 262 851 22,7 10,0

16,7 16,3 1 095 213 10,3 15,2 8 526 8,2 0,8 3 119 026 31,3 34,7

7,6 58,0 1 180 890 11,1 103,1 2 893 2,8 27,0 808 545 8,1 35,8

6,2 6,1 627 850 5,9 31,1 3 299 3,2 (0,7) 364 268 3,7 18,5

16,3 48,7 1 941 218 18,2 36,4 7 785 7,5 5,6 895 830 9,0 11,8

5,0 16,6 553 940 5,2 37,6 4 659 4,4 6,8 368 176 3,7 2,4

15,9 16,6 1 933 830 18,1 45,9 7 435 7,1 28,3 865 958 8,7 20,7

100,0 24,3 10 662 569 100,0 43,0 104,184 100,0 11,6 9 967 448 100,0 19,9

75,9 23,9 7 963 543 74,7 42,4 91 908 88,2 12,7 5 678 707 57,0 11,8

16,5 15,0 1 518 136 14,2 18,5 9 383 9,0 (1,0) 3 480 196 34,9 31,9

7,6 58,0 1 180 890 11,1 103,1 2 893 2,8 27,0 808 545 8,1 35,8

2006

2007

2006

2007

2006

2007

Revenue R’bn Trading profi t R’m Trading margin %

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

2006

2007

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 5 10 15 20 25 30 0 100 200 300 400 500 600 700 800

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410

0 2 4 6 8 12 1410



Revenue Trading profit2007 2006 % 2007 2006 % 2007

Trading division R’000 R’000 change R’000 R’000 change R’000

Corporate Services 1 477 364 1 295 421 14,0 203 230 108 383 87,5 216 004

Bidprop 82 471 58 039 42,1 95 801

Namsov 469 974 378 430 24,2 80 077 75 925 5,5 80 077

Ontime Automotive 986 566 893 231 10,4 (3 348) 7 348 (3 348)

Investment and other income 20 824 23 760 (12,4) 44 030 (32 929) 43 474

Bidfreight 18 994 985 15 787 550 20,3 596 352 536 366 11,2 598 560

Bidserv 5 393 090 4 639 395 16,2 669 411 562 433 19,0 623 422

Bidvest Europe 29 962 516 22 132 036 35,4 757 551 651 223 16,3 751 044

Bidvest Asia Pacifi c 8 863 650 6 505 802 36,2 346 554 219 403 58,0 346 554

Bidfood 3 845 772 3 344 173 15,0 279 814 263 829 6,1 262 659

Caterplus and Speciality 2 593 194 2 197 632 18,0 181 233 148 270 22,2 181 233

Bidfood Ingredients 1 252 578 1 146 541 9,2 98 581 115 559 (14,7) 81 426

Bid Industrial and Commercial Products 8 565 131 6 916 100 23,8 742 670 499 468 48,7 739 663

Bidpaper Plus 1 823 822 2 108 870 (13,5) 226 899 194 631 16,6 225 142

Bid Auto 18 689 283 16 197 055 15,4 724 303 621 264 16,6 733 522

97 615 613 78 926 402 23,7

Inter-group eliminations (1 960 104) (1 649 911)

95 655 509 77 276 491 23,8 4 546 784 3 657 000 24,3 4 496 570

Geographic region

Southern Africa 57 708 227 49 127 806 17,5 3 448 077 2 783 416 23,9 3 404 370

United Kingdom and continental Europe 31 043 736 23 292 794 33,3 752 153 654 181 15,0 745 646

Asia Pacifi c 8 863 650 6 505 802 36,2 346 554 219 403 58,0 346 554

97 615 613 78 926 402 23,7 4 546 784 3 657 000 24,3 4 496 570

Consolidated segmental analysisfor the year ended 30 June 2007

Geographic contribution (%)

Southern Africa

United Kingdom and continental Europe

Asia Pacifi c

Divisional contribution (%)

Corporate Services

Bidfreight

Bidserv

Bidvest Europe


Bidfood


Bidpaper Plus

Bid Auto


19,5

5,5

30,79,1

3,9

8,8

1,9

19,1

1,5 1,6

20,0

5,9

28,08,2

4,3

8,8

2,7

20,5

59,1

31,8

9,1

62,2

29,5

8,3

4,5

13,1

14,7

16,77,6

6,2

16,3

5,0

15,93,0

14,7

15,3

17,86,0

7,2

13,7

5,3

17,0

75,9

16,5

7,6

76,1

17,9

6,0

4,8

7,75,8

16,4

5,1

16,3

16,6

7,7

Operating profit Operating assets Operating liabilities Depreciation2006 % 2007 2006 % 2007 2006 % 2007 2006

R’000 change R’000 R’000 change R’000 R’000 change R’000 R’000

101 141 113,6 2 507 127 2 049 174 22,3 371 527 443 994 (16,3) 84 779 93 172

58 463 63,9 796 931 534 770 49,0 18 480 358 5 062,0 13 191 10 982

75 925 5,5 255 240 159 168 60,4 131 037 64 126 104,3 10 558 10 261

(4 035) 478 267 481 489 (0,7) 156 804 176 754 (11,3) 59 642 70 465

(29 212) 976 689 873 747 11,8 65 206 202 756 (67,8) 1 388 1 464

776 057 (22,9) 2 481 567 2 241 200 10,7 2 352 210 2 411 561 (2,5) 90 768 78 490

556 083 12,1 2 345 372 1 939 926 20,9 1 280 701 1 081 399 18,4 199 583 171 107

639 788 17,4 6 382 469 5 944 454 7,4 5 287 256 4 993 637 5,9 312 648 214 481

219 403 58,0 2 758 690 1 478 636 86,6 1 577 800 897 274 75,8 76 687 62 601

257 050 2,2 1 360 680 1 049 791 29,6 732 830 570 726 28,4 41 079 34 263

148 270 22,2 767 319 566 846 35,4 472 823 366 304 29,1 21 126 18 997

108 780 (25,1) 593 361 482 945 22,9 260 007 204 422 27,2 19 953 15 266

513 434 44,1 3 348 698 2 609 177 28,3 1 407 480 1 186 306 18,6 56 308 47 977

(8 200) 853 915 738 189 15,7 299 975 335 535 (10,6) 30 660 42 344

636 751 15,2 4 239 994 3 113 097 36,2 2 306 164 1 787 422 29,0 66 139 35 304

26 278 512 21 163 644 24,2 15 615 943 13 707 854 13,9

(401 072) (325 541) – (401 072) (325 541) –

3 691 507 21,8 25 877 440 20 838 103 24,2 15 214 871 13 382 313 13,7 958 651 779 739

2 806 394 21,3 16 523 225 13 202 323 25,2 8 559 682 7 609 450 12,5 507 612 427 931

665 710 12,0 6 996 597 6 482 685 7,9 5 478 461 5 201 130 5,3 374 352 289 207

219 403 58,0 2 758 690 1 478 636 86,6 1 577 800 897 274 75,8 76 687 62 601

3 691 507 21,8 26 278 512 21 163 644 24,2 15 615 943 13 707 854 13,9 958 651 779 739


8

13,3

13,9

16,7

2,7

21,0

15,0

17,35,9

7,0

13,9

17,2

75,7 76,0

18,0

6,0

9,5

9,4

8,9

24,310,5

5,2

12,7

3,2

16,3 9,7

10,6

9,2

28,07,0

5,0

12,3

3,5

14,7

62,9

26,6

10,5

62,4

30,6

7,0

2,4

15,0

8,2

33,910,1

4,7

9,0

1,9

14,83,2

17,6

7,9

36,4

6,5

4,3

8,72,4

13,0

54,8

35,1

10,1

55,5

37,9

6,6

8,8

9,5

20,8

32,6

8,0

4,3

5,93,2

6,9

27,5

8,0

4,4

6,35,4

53,0

39,0

8,0

37,1

8,0


Capital expenditure Amortisation and impairments of intangible assets Goodwill and intangible assets% 2007 2006 % 2007 2006 % 2007 2006 %

change R’000 R’000 change R’000 R’000 change R’000 R’000 change

(9,0) 409 037 272 453 50,1 2 798 934 199,6 37 678 2 637 1 328,8

20,1 281 381 174 372 61,4 – – – 142 142 –

2,9 36 333 31 060 17,0 857 – 100,0 27 587 2 489 1 008,4

(15,4) 90 567 66 620 35,9 – – – – – –

(5,2) 756 401 88,5 1 941 934 107,8 9 949 6

15,6 268 635 226 530 18,6 24 790 26 199 (5,4) 91 777 104 754 (12,4)

16,6 290 354 235 386 23,4 36 667 40 979 (10,5) 343 311 323 289 6,2

45,8 390 930 420 783 (7,1) 43 552 29 358 48,3 2 461 494 2 281 896 7,9

22,5 153 028 68 708 122,7 3 791 3 997 (5,2) 737 520 302 586 143,7

19,9 79 164 91 306 (13,3) 3 566 3 412 4,5 25 155 47 837 (47,4)

11,2 49 824 35 208 41,5 3 557 3 404 4,5 23 047 18 642 23,6

30,7 29 340 56 098 (47,7) 9 8 12,5 2 108 29 195 (92,8)

17,4 113 827 74 469 52,9 27 977 30 966 (9,7) 93 612 112 729 (17,0)

(27,6) 84 889 97 415 (12,9) 1 579 1 249 26,4 95 943 85 757 11,9

87,3 192 510 118 321 62,7 150 – 100,0 273 952 241 045 13,7

22,9 1 982 374 1 605 371 23,5 144 870 137 094 5,7 4 160 442 3 502 530 18,8

18,6 1 346 980 1 040 965 29,4 97 276 103 728 (6,2) 961 427 918 044 4,7

29,4 482 366 495 698 (2,7) 43 803 29 369 49,1 2 461 495 2 281 900 7,9

22,5 153 028 68 708 122,7 3 791 3 997 (5,2) 737 520 302 586 143,7

22,9 1 982 374 1 605 371 23,5 144 870 137 094 5,7 4 160 442 3 502 530 18,8

11,9

10,1

21,9

4,5

54,9

0

0,11,9

17,1

25,3

30,1

2,62,5

19,3

1,119,1

29,9

21,4

2,92,5

22,6

0,9 0,7

67,1

30,2

2,7

75,7

21,4

2,9

20,6

13,6

14,619,7

7,7

4,0

5,7

4,4

9,717,0

14,1

14,726,2

4,3

5,7

4,6

6,07,4

67,9

24,3

7,8

64,8

30,9

4,3

0,9 2,28,3

59,2

17,7

0,62,2 2,3 6,6 0,2 3,0

9,2

65,1

8,6

1,43,2

2,46,9

59,2

17,7 23,1

65,2

8,626,2

Performance at a glance

100

90

80

70

60

50

40

30

20

10

0

Revenue: R’bn

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

3 000

2 700

2 400

2 100

1 800

1 500

1 200

900

600

300

0

Attributable profi t: R’m

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

1 000

900

800

700

600

500

400

300

200

100

0

Headline earnings per share: cents

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

500

450

400

350

300

250

200

150

100

50

0

Distribution per share: cents

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

2 500

2 250

2 000

1 750

1 500

1 250

1 000

750

500

250

0

Net tangible asset value per share: cents

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

5 000

4 500

4 000

3 500

3 000

2 500

2 000

1 500

1 000

500

0

Trading profi t: R’m

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

5 000

4 500

4 000

3 500

3 000

2 500

2 000

1 500

1 000

500

0

Cash generated by operations: R’m

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

40

36

32

28

24

20

16

12

8

4

0

Total assets: R’bn

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

50

45

40

35

30

25

20

15

10

5

0

Market capitalisation: R’bn(6)

93 94 95 96 97 98 99 00 01 02 03 04 05 06 07



In accordance with IFRS

16 year compound

growth rates % per annum 2007 2006 2005 2005

Extract from fi nancial statements (R’000)Revenue 40,6(5) 95 655 509 77 276 491 62 811 776 62 811 776 Trading income 35,5(5) 4 546 784 3 657 000 3 046 108 3 164 646 Attributable profi t 37,3(5) 2 700 054 2 388 717 1 961 231 2 054 193 Shareholders’ interest 10 626 509 8 928 995 7 468 866 7 388 482 Net debt 3 764 451 1 452 089 988 738 944 597 Cash generated by operations 4 236 895 4 490 358 4 200 449 3 977 293 Total assets 32 843 849 27 994 501 21 123 331 20 894 966 Wealth created by trading operations 16 776 753 14 048 687 11 955 216 11 744 777

Share and debentures statisticsHeadline earnings per share (cents)(1) 25,5(5) 970,0 804,6 656,4 686,6 Distribution per share (cents)(2) 25,7 446,4 369,0 306,0 306,0 Distribution cover (times)(2) 2,2 2,2 2,1 2,2 Distribution yield (%) 3,2 3,7 4,2 4,2 Net tangible asset value per share (cents) 20,3(5) 2 135 1 814 1 542 1 604 Share price (cents) high 14 780 11 650 8 100 8 100 low 9 430 7 200 5 195 5 195 closing (June 30) 27,8 14 123 9 875 7 270 7 270 Market capitalisation (Rm’s)(6) 37,2 42 772 29 541 21 768 21 768 Volumes traded (000’s) 233 306 206 156 166 720 166 720 Volume traded as % of weighted number of shares 77,7 68,7 55,1 55,1

Ratios and statisticsReturn on total shareholders’ interest (%) 30,2 32,0 31,8 34,2 Return on average funds employed (%)(3) 50,2 54,0 53,5 55,0 Trading profi t margin (%) 4,8 4,7 4,8 5,0 Current asset ratio 1,0 1,1 1,1 1,1 Quick asset ratio 0,7 0,8 0,7 0,7 Number of employees 104 184 93 325 89 737 89 737 Number of shares in issue (000’s)(6) 302 852 299 154 299 421 299 421 Number of weighted shares in issue(6) 300 206 299 976 302 700 302 700

Notes(1) Based on weighted average number of shares in issue.(2) Includes interim dividend paid, capitalisation issues at market value, distributions

of share premium and fi nal distributions approved after year end.(3) Return on average funds employed is calculated using the weighted average of

the Group’s operating assets, excluding cash, and operating income before capital items, interest and taxation.

(4) The comparative fi gures have been restated to account for the various changes in accounting policies over the period to comply with SA GAAP but not for IFRS purposes. Periods prior to June 30 2003 have not been restated for the eff ect of the recent change in interpretation of the accounting statements.

(5) Prior year amounts have not been restated to take account of changes to accounting policies as a result of the adoption of IFRS in the 2006 and 2005 years. Comparative information for the 1991 to 2005 years in accordance with the previous SA GAAP is provided for information and comparative purposes.

(6) The number of shares in issue has been reduced by the treasury shares held by a subsidiary company.

Performance at a glance

2007Acquired 100% of Angliss, a leading foodservice wholesaler and distributor in Singapore, Hong Kong and China. Negotiations fi nalised to acquire Viamax Holdings. Rennies Bank renamed Bidvest Bank. Black economic empowerment partnership with Dinatla Consortium refi nanced and extended for fi ve years. A R4,5 billion domestic medium-term note programme set up.

2006Acquired 100% of Netherlands foodservice company, Deli XL and a controlling stake in Horeca Trade, a small Dubai-based foodservice distributor. Concluded sale of Dartline Shipping for £58,9 million (R650 million) and loss-making Lithotech France. Global footprint expanded through investment to develop and operate Mumbai International Airport. Non-executive component of the board strengthened.

2005Cyril Ramaphosa takes the reins as chairman. Successful buyout of Bidcorp plc minority interest. Acquisition of 20% of Tiger Wheels. G. Fox acquired.

In terms of previous Gaap(4)

2004 2003 2002 2001 2000 1999 1998

51 262 212 47 073 375 41 950 388 29 415 011 26 427 620 14 646 145 7 432 920 2 544 074 2 239 662 2 012 611 1 422 212 1 215 222 712 230 493 051 1 531 868 1 334 552 1 231 041 1 035 466 884 148 659 573 400 872 5 998 413 5 353 416 5 563 617 3 860 494 3 028 819 2 985 433 2 803 898

674 071 – – – – – – 3 760 849 2 666 695 2 751 675 1 558 774 1 282 688 859 256 491 126

18 021 382 14 592 486 15 117 104 9 741 970 8 134 879 7 680 848 4 101 777 10 230 550 9 247 324 7 441 092 5 079 614 4 515 614 2 692 295 1 610 681

544,0 463,5 432,8 365,2 309,7 243,0 171,2 250,2 220,0 190,0 169,2 150,3 127,3 101,3

2,2 2,1 2,3 2,2 2,1 1,9 1,7 4,8 5,1 4,1 3,4 3,2 2,5 2,2

1 330 1 549 1 569 1 186 1 046 1 042 1 135

5 620 4 800 5 200 5 200 6 550 5 400 5 980 4 100 3 970 3 980 4 075 3 620 2 910 3 250 5 250 4 300 4 600 5 010 4 680 5 040 4 525

16 570 13 462 14 316 14 821 13 555 14 435 11 181 160 233 156 731 125 566 99 096 104 122 89 262 64 413

53,3 50,9 42,0 34,0 36,1 32,9 27,5

28,6 24,0 31,9 34,2 29,6 23,5 22,8 53,6 48,9 56,8 43,6 41,7 40,4 37,2

5,0 4,8 4,8 4,8 4,6 4,9 6,6 1,2 1,3 1,2 1,2 1,1 1,2 2,8 0,8 1,0 0,9 0,9 0,8 0,9 2,1

81 931 70 754 66 879 54 251 50 941 50 132 31 420 302 156 302 679 311 217 295 821 289 638 286 418 247 095 300 643 308 116 299 089 291 599 288 554 271 483 234 090

2001John Lewis Foodservice acquired and incorporated into Bidvest Australia, creating the leading foodservice distributor in Australia. The Group wide-area-network, Bidnet, developed by I-Fusion. mymarket.com, Bidvest’s e-commerce initiative, launched.

2000Acquisition of Island View Storage. Banking licence granted to Rennies Bank and 77% of I-Fusion acquired. Bidvest plc enters the New Zealand foodservice market with the acquisition of Crean Foodservice, renamed Crean First for Foodservice.

1999Booker Foodserve, renamed 3663 First for Foodservice, acquired by Bidvest plc. Acquisition of Rennies Group.

1998Bidvest plc, incorporating Bidvest Australia, was created with dual listings in Australia and Luxembourg. Acquisition of Lithotech.

2004R2,1 billion BEE transaction for 15% of Bidvest with Dinatla fi nalised. McCarthy, South Africa’s second largest motor retailer, acquired for R980 million. Acquisition of minority interests of Bidvest plc.

2003Danel, the largest business forms manufacturing and distribution operation in France, acquired and renamed Lithotech France. The Bidvest Academy, a Group training and development programme, launched. Ground-breaking black economic empowerment initiative with Dinatla Investment Holdings announced. Small strategic foodservice acquisitions in the United Kingdom, Australian and New Zealand markets.

2002Acquisition of 56,7% of LSE-listed Jacobs Holdings plc, which was renamed Bidcorp plc, to form the base for the international expansion of Bidfreight. Paragon acquired and merged with Lithotech. Remaining 68% of Voltex acquired to form part of the Commercial Products division. The minority shareholding in I-Fusion acquired.



1997 1996 1995 1994 1993 1992 1991

5 069 948 4 166 682 3 432 155 2 560 707 775 206 595 994 411 694 276 843 216 111 165 243 115 622 68 461 58 075 35 377 214 249 165 577 123 751 88 602 35 745 25 071 16 898

1 758 311 802 451 602 358 499 657 430 522 134 156 107 064 – – – – – 46 121 –

297 814 277 035 113 811 125 146 45 708 59 691 23 216 3 251 061 1 583 321 1 188 202 980 743 747 401 388 563 321 639

899 879 696 702 524 636 412 828 224 924 175 299 104 350

124,9 102,6 77,8 58,1 38,1 28,0 25,6 70,8 56,1 43,0 30,2 21,0 16,4 11,5

1,8 1,8 1,8 1,9 1,8 1,7 2,2 2,0 2,2 2,3 2,1 2,7 4,1 4,1

771 438 343 292 258 136 111

3 535 2 956 2 000 1 470 780 400 283 2 275 1 838 1 450 780 343 250 180 3 500 2 590 1 875 1 470 780 400 280 7 968 4 681 3 294 2 502 1 301 391 271

26 456 13 997 8 140 11 061 1 186 4 877 1 247 14,2 7,8 4,7 6,5 1,1 5,0 1,8

26,7 27,5 24,8 20,6 26,6 23,4 68,6 53,9 57,6 58,8 48,9 29,0 28,2 37,9

5,5 5,2 4,8 4,5 8,8 9,7 8,6 2,0 2,0 1,9 1,8 2,0 2,5 1,7 1,5 1,5 1,5 1,4 1,5 1,4 1,0

30 001 21 506 14 970 14 117 4 749 4 784 2 226 228 027 183 041 175 701 171 131 166 775 98 552 96 266 186 779 179 895 173 306 169 121 105 217 97 028 69 092

1997100% of Waltons Group acquired, Bid Corporation unbundled and Bidvest incorporated into the JSE industrial index.

1996Empowerment programmes begin with Women Investment Portfolio Holdings and Worldwide African Investment Holdings each acquiring a 5% shareholding in Bid Corporation.

1995First steps to international expansion taken – 50,1% of Australian Stock Exchange-listed Manettas acquired and renamed Bidvest Australia.

1994Rights off er raises R300 million, 10-for-1 share sub division.

1993Safcor Freight acquired – the start of Bidfreight. Prestige Cleaning Services acquired and grouped with Steiner to form Bidserv.

1992Crown Food Holdings acquired and merged with National Spice to form Crown National.

1991Acquisition of Steiner Services – beginning of the hygiene services business.

1990Bid Corporation becomes the pyramid holding company of Bidvest.

1989Acquisition of Afcom.

1988Chipkins, the fi rst acquisition, followed shortly therafter by Sea World. The start of Bidfood.

External appraisals

Empowerment ratingBidvest, a level five contributor, with an unconstrained operational capacity, has a “BBB” empowerment rating from Empowerdex.

Top empowerment companies 2007 surveyBidvest was ranked 10th in the Financial Mail/Empowerdex “Top Empowerment Companies 2007” survey, which included the top 200 listed companies in South Africa.

Fitch RatingsFitch Ratings affirmed Bidvest’s credit rating as an AA- (zaf ). AA- (zaf ) ratings denote a very strong credit risk relative to other issuers in the same country.

Dow Jones Sustainability World IndexBidvest is one of only three South African companies listed in the Dow Jones Sustainability World Index 2007, a grouping of global organisations that meets stringent criteria for strategic strength, innovation, financial performance and stakeholder relations.

JSE Social Responsibility Investment IndexBased on an assessment of the Group’s policies, performance and reporting on economic, social and environmental sustainability, the JSE has reaffirmed Bidvest as a founding constituent of the SRI Index.

Forbes Global 2000 – the world’s 2 000 largest public companiesForbes Global 2000 is a list of the world’s largest and most influential companies in terms of US dollars based on a composite ranking which includes sales, market value, assets and profits. Bidvest is currently ranked at 1 115th after being ranked at 1 162nd in 2005. (Value of $6,32 billion).

FTSE/JSE Africa Index Series rankingIn the June 2007 FTSE/JSE Africa Index Series quarterly review, Bidvest was ranked 25th in both the FTSE/JSE All Share Index and Top 40, 8th in the FTSE/JSE Industrial 25, with a market capitalisation of R48,4 billion, a 100% free float and the JSE’s highest liquidity rating.

Morgan Stanley International Emerging Market IndexBidvest is considered to have an 80% free float for the MSCI SA Index, and a weighting of 2,4%.

Bidvest as an employer of choiceBidvest has been recognised by a panel of experts as one of the top 10 companies to work for in South Africa in research undertaken by the Corporate Research Foundation.

Company confidence predictorBidvest performed exceptionally well, rating not only top in total (across all 28 characteristics used in the evaluation)

within the Industrial Sector, but also among the major large capitalisation companies from all sectors. Bidvest also performed well in terms of “Company Basics” and “People”. In the Industrial Sector Bidvest was the leader in “Communications”, held second place for “Social Relations” and third for “Ethics” and “Future Prospects”. Among the most important characteristics as rated by the investment professionals, some individual characteristics in which Bidvest led in the Industrial Sector were “has inherently strong products, services or subsidiaries”, “is a well-managed company”, “makes effective use of capital”, “is alert to new ideas to improve profitability”, “has an effective chief executive” and “chief executive is a straight talker”. Among the major large capitalisation companies from all sectors, Bidvest also headed the list with “has inherently strong products, services or subsidiaries”, “is a well-managed company” and “has an effective chief executive”.

Community Growth Funds SRI awardsBidvest is one of only 11 winners of the inaugural Unity Awards backed by major trade unions, recognising Bidvest’s credentials as an empowered, socially responsible employer.

Ernst & Young – excellence in sustainability reportingBidvest was placed in the top five for excellence in sustainability reporting in a survey organised by Ernst & Young, which ranked all 58 companies listed on the JSE’s Socially Responsible Investment Index.

The South African JSE annual report awardsBidvest ranked in the JSE South African annual report awards winners.

Most admired companyIn the Finweek‘s “most admired CEOs and companies” peer review survey, Bidvest was ranked within the top 10 companies recognised and ranked 6th in terms of turnover. Brian Joffe was listed within the top five CEOs.

South Africa’s leading managersBrian Joffe has been recognised in South Africa’s leading managers collated by the Corporate Research Foundation. Being at the helm of Bidvest, which has maintained its record of 19 years of uninterrupted earnings growth, Brian Joffe celebrates a “decentralised methodology”, which he describes as harnessing the enthusiasm of each and every staff member at all levels of the business.

2007 Sappi African printers of the year awardThe Bidvest annual and sustainability reports won the gold medal for 2007, for excellence in printing. The competition benchmarks against world-class publications which reflect a responsible attitude towards the environment.



Continental Europe

■ Amsterdam■ Brede■ Burgh Haamstede■ Drachten■ Ede■ Emmen■ Geleen■ Groningen■ Helleveetsluis■ Helmond■ Hoofddorp■ Lochem■ Luxembourg■ Meppen■ Nieuwegein■ Sehledam■ Sluis■ Thuin

United Kingdom

■ Avonmouth■ Barking■ Birmingham■ Dartford■ Denny■ Dublin■ Edenbridge■ Edinburgh■ Enfi eld■ Gateshead■ ■ Glasgow■ Harlow Chelmsford■ High Wycombe■ Huddersfi eld■ Isle of Man■ Lee Mill■ London■ Manchester■ Newcastle-upon- Tyne

■ Northampton■ Plymouth■ Royton■ Salisbury■ Scarisbrick■ Sevenoaks■ Southampton■ Stonehouse■ Storeham■ Stowmarket■ Wakefi eld■ Worthing

Southern Africa

■ Ariemsvlei■ Beira■ Beitbridge■ Blantyre■ ■ ■ Bloemfontein■ Bulawayo ■ ■ ■ ■ Cape Town■ Chingola■ Chirundu■ ■ ■ ■ Durban■ Empangeni■ ■ ■ Gaborone■ ■ George■ Groblersburg■ Gweru■ Harare■ Jeff reys Bay■ ■ ■ ■ Johannesburg

■ Kasane

■ Kitwe■ Lilongwe■ Livingstone■ Luderitz■ Lusaka■ Maputo■ Mauritius■ Mchinji■ Mthatha■ Musina■ Mutare■ Nacala■ Ndola Mwanza■ Nelspruit■ Nyamapanda■ Oranjemund■ Oshakati■ ■ Paarl■ Phalaborwa

■ Pietermaritzburg■ Polokwane■ ■ ■ ■ Port Elizabeth■ ■ ■ ■ Pretoria■ Queenstown■ ■ Richards Bay■ Saldanha■ Seychelles■ Stellenbosch■ Swakopmund■ Upington■ Vredenburg■ ■ Walvis Bay■ Welkom■ ■ ■ Windhoek■ Witbank■ Worcester

■ Corporate Services

■ Bidfreight

■ Bidserv

■ Bidvest Europe

■ Bidvest Asia Pacific

■ Bidfood

■ Bid Industrial and Commercial Products

■ Bidpaper Plus

■ Bid Auto

Global footprint


Australia

■ Adelaide■ Albury■ Armidale■ Brisbane■ Cairns■ Canberra■ Central Coast■ Coff s Harbour■ Darwin■ Geelong■ Gold Coast■ Hervey Bay■ Hobart■ Ipswich■ Mackay■ Melbourne■ Newcastle■ Perth■ Sunshine Coast■ Sydney■ Tamworth■ Toowoomba■ Townsville■ Wollongong

New Zealand

■ Auckland■ Christchurch■ Dunedin■ Hamilton■ Hawkes Bay■ Invercargill■ Nelson■ New Plymouth■ Palmerston North■ Queenstown■ Rotorua■ Timaru■ Wellington■ Whangarei

Far East

■ Beijing■ Dubai■ Guangzhou■ Hong Kong■ Mumbai■ Shanghai■ Shenzen■ Singapore

Lionel Isaac Jacobs (64) BCom, MBACommercial director Bidserv, appointed October 27 2003

Director of numerous Bidvest subsidiaries, Bassap Investments (Pty) Limited and Dinatla Investment Holdings (Pty) Limited. Lionel is an entrepreneur with extensive negotiating and investment skills and established Bassap Investments (Pty) Limited, a core shareholder in the Dinatla consortium, to further his commitment to the principles of black economic empowerment.

Peter Nyman (62) CA(SA), HDip Tax LawExecutive director, appointed February 1 1991

Peter, the previous fi nancial director, has been an executive director of the Group for nearly seventeen years. He is also director of numerous Bidvest subsidiaries, including Bid Industrial and Commercial Products, Bidserv and Bidvest Bank, Chairman of the trustees of the Quantum Medical Aid Society, Bidcorp Group Pension Fund and Bidcorp Group Provident Fund. Peter has extensive local and international fi nancial experience in a diverse range of industries specialising in tax.

Sybrand Gerhardus Pretorius (59) MCom Business EconomicsChief executive of Bid Auto, appointed February 19 2004

Director of numerous Bidvest subsidiaries. Brand has thirty four years’ experience in the motor industry (manufacturing and retail). He is the vice-chairman of the State President’s International Marketing Council and serves on the boards of the National Business Initiative and the READ Educational Trust. Brand is the immediate past President of the South African Retail Motor Industry Association.

Lindsay Peter Ralphs (52) CA(SA)Chief executive of Bidserv, appointed May 10 1992

Director of numerous Bidvest subsidiaries and Enviroserv Holdings Limited. Lindsay joined Bidvest as operations director in 1992. In 1994 he was appointed managing director of Steiner and following the acquisition of Prestige to form Bidserv, appointed chief executive of Bidserv.

Alan Charles Salomon (58) CA(SA), BSc (London) (with honours)Managing director of Bidvest Bank, appointed September 10 1990

Director of numerous Bidvest subsidiaries and Enviroserv Holdings Limited. Alan has twenty eight years’ experience in the fi elds of manufacturing and distribution. Alan is managing director of Bidvest Bank Limited.

Executive directors

Frederick John Barnes (56) BritishChief executive of Bidvest Europe and 3663 First for Foodservice, appointed October 27 2003

Fred has extensive international foodservice and distribution experience.

Bernard Larry Berson (42) Australian CAChief executive of Bidvest Asia Pacifi c, appointed October 27 2003

Bernard has twenty years of international fi nancial, administrative and management experience in numerous industries.

Myron Cyril Berzack (58)Chief executive of Bid Industrial and Commercial Products, appointed April 29 2002

Non-executive director of Allied Electronics Corporation Limited and Amalgamated Appliance Holdings Limited. Director of numerous Bidvest subsidiaries. Myron has thirty seven years’ experience in the electrical industry, specialising in the marketing, distribution, fi nancial control and reporting functions.

David Edward Cleasby (45) CA(SA)Group fi nancial director, appointed July 9 2007

Director of numerous Bidvest subsidiaries. David was fi nancial director of Rennies Terminals when the Rennies Group Limited was acquired by Bidvest in 1998. In 2001, he joined the Bidvest corporate offi ce, where he has been involved in both Group corporate fi nance and investor relations. David was appointed as an alternate director to Peter Nyman on June 28 2006 and appointed Group fi nancial director on July 9 2007.

Anthony William Dawe (41) CA(SA)Chief executive of Bidfreight, appointed June 28 2006

Director of numerous Bidvest subsidiaries. Anthony has thirteen years’ experience in the freight industry with most of those years focused in the South African port environment. Prior to this, Anthony’s experience was in fi nancing in London and he worked for one of the large accounting fi rms in South Africa.

Matamela Cyril Ramaphosa (54) BProc Non-executive chairman, appointed July 6 2004

Executive chairman of Shanduka Group (Pty) Limited. Joint non-executive chairman of Mondi plc and Mondi Limited. Non-executive chairman of MTN Group Limited and SASRIA Limited. Non-executive director of SAB Miller plc, Macsteel Global b.v, Alexander Forbes Limited and The Standard Bank Group Limited. Cyril is the past chairman of the Black Economic Empowerment Commission. He is vice-chairman of the Global Business Coalition on HIV/Aids, Tuberculosis and Malaria and sits on the board of the Commonwealth Business Council. He sits on the United Nations Secretary General’s Panel on International Support to NEPAD. Cyril has received several honorary doctorates.

Directorate

Cyril Ramaphosa

Brian Joff e (60) CA(SA)Chief executive, appointed March 1 1989

Non-executive director of Enviroserv Holdings Limited, Tiger Automotive Limited and a director of numerous Bidvest subsidiaries. Since founding Bid Corporation in 1988, Brian served as executive chairman until his appointment as chief executive in 2004. He has over thirty years of local and international commercial experience. He was one of the Sunday Times’ top fi ve businessmen in 1992 and is a past recipient of the Jewish Business Achiever of the Year award. Brian was voted South Africa’s Top Manager of the Year in 2002 in the Corporate Research Foundation’s publication “South Africa’s Leading Managers” and represented South Africa at the coveted “Ernst & Young World Entrepreneur of the Year” award in 2003.

Brian Joffe


Fred BarnesBernard BersonMyron Berzack

Alan Salomon

David CleasbyAnthony Dawe

Lionel Jacobs

Peter NymanBrand PretoriusLindsay Ralphs


Independent non-executive directors

Douglas Denoon Balharrie Band (63) CA(SA)Appointed October 27 2003

Non-executive director of The Standard Bank Group Limited, Myriad International Holdings B.V., Tiger Brands Limited and MTN Group Limited. Doug has extensive experience in both commerce and industry and has served in an executive position in various blue-chip listed companies.

Stephen Koseff (56) BCom, CA(SA), HDip BDP, MBAAppointed June 17 1997

Chief executive offi cer of Investec Limited and Investec plc. Stephen has thirty one years of fi nancial experience and is the recipient of numerous business awards. He is a former member of the Financial Markets Advisory Board and former chairman of the Independent Banks Association. His directorships include the JSE Limited and Rensburg Sheppards plc.

Donald Masson (76) ACISAppointed March 10 1992

Director of numerous Bidvest subsidiaries, Cashbuild Limited, Valley Irrigation Limited, Faritec Holdings Limited and Kumnandi Food Corporation. Trustee of Investment Solutions and various other pension funds. Donald is a former President of the Afrikaanse Handelsinstituut and a former member of the President’s Economic Advisory Council and Chairman of the SA Post Offi ce. He has forty years of diverse business experience in senior executive positions at listed, unlisted and parastatal organisations.

Joseph Leon Pamensky (77) CA(SA), OMSGAppointed January 8 1990

Director of Enviroserv Holdings Limited, Schindler Lifts (SA) (Pty) Limited, Stonehage Financial Services Holdings (Jersey) Limited and Worldwide African Investment Holdings (Pty) Limited. Chairman of Bidvest Bank Limited and Terra Nova Financial Services (Pty) Limited. Joe is the longest serving non-executive director of Bidvest with over forty years’ experience in the fi nancial, insurance and banking industries and the recipient of a number of business and public awards. He serves as a non-executive director on the boards of public and private companies, both locally and internationally, and is a member of a number of audit and remuneration committees. Originally also a director of Bid Corporation Limited.

Nigel George Payne (47) BCom (Hons), CA(SA), MBLAppointed June 28 2006

Director of a number of companies including JSE Limited, Mr Price Limited, Glenrand MIB Limited, STRATE Limited. Nigel is a leading authority on corporate governance, risk management and internal audit and was the convenor of the risk management and internal audit task team at the King II report.

Adv Faith Dikeledi Pansy Tlakula (50)Appointed June 28 2006

Chief electoral offi cer of The Independent Electoral Commission. Director of Lehotsa Holdings (Pty) Limited, MMRT (Pty) Limited and Khomanani Women’s Investment (Pty) Limited. Pansy was previously a member of the Human Rights Commission. She is the chairperson of the National Credit Regulator.

Non-executive directors

Lilian Garner Boyle (60) (British) MBAMA Econ (Glasgow)Appointed January 23 2001

Non-executive director of the South African Bank Note Company (Pty) Limited. Lilian has thirty nine years of diverse business experience including seven years in the freight management industry and twenty years in the travel industry.

Alfred Anthony da Costa (43) BCom (Hons) BComAppointed December 8 2003

Chairman of the IQUAD Group of Companies, director of Algoa FM, Breathetex Corporation (Pty) Limited, Ukuvula Investments (Pty) Limited and Dinatla Investment Holdings (Pty) Limited, executive chairman Ilithe Technologies (Pty) Limited and member of Unisa Council. Alfred has fi fteen years’ experience in top management.

Muriel Betty Nicolle Dube (34) BA (Hons), Executive Programme (Harvard)Appointed October 27 2003

Director of numerous Bidvest subsidiaries, Enviroserv Holdings Limited and ZAICO (Pty) Limited. Muriel has senior strategic management and operational experience in the public sector and with multi-nationals in the private sector.

Rachel Mathabo Kunene (67) BA English Lit (UCLA)Appointed December 8 2003

Director of Dinatla Investment Holdings (Pty) Limited; NPMS Energy (Pty) Limited in joint venture with PMB Petroleum Services & Sydney Road Truck Stop (Engen); Ikhwezi Lomso Laundries (Pty) Limited in joint venture with First Garment Laundries (KwaZulu-Natal); Trustee of Isigodlo Trust (South African Women In Dialogue). Trustee of The Mazisi Kunene Foundation and of Orphans of Aids Foundation (KwaZulu-Natal). Vice chair of Business Womens Association (Durban Branch). Mathabo is a founder member of the broad-based empowerment group Nandi Heritage (Pty) Limited which is a shareholder in Dinatla Investment Holdings (Pty) Limited.

Tania Slabbert (40) BA, MBAAppointed December 8 2003

Director of BP South Africa (Pty) Limited, Uthingo (Pty) Limited, Rennies Travel (Pty) Limited and Dinatla Investment Holdings (Pty) Limited. Tania has been the chief executive offi cer of WDB Investment Holdings (Pty) Limited since 1999. She is also a member of the National Small Business Advisory Council and a board member of the Business Women’s Association.

Alternate non-executive director

Lebogang Joseph Mokoena (48) BSc (Med Sci), MBA, Alternate to AA da CostaAppointed December 8 2003

Director of Ten Alliance Holdings (Pty) Limited, Sesiu Investment Holdings (Pty) Limited, Bloemfontein Correctional Contracts (Pty) Limited, Culca Investments (Pty) Limited, Lumumba Capital Investments (Pty) Limited and Dinatla Investment Holdings (Pty) Limited. Lebogang has a number of years’ experience as a director of private companies. Over the years he provided management consultancy services to SMMEs, the public and private sectors. In recent years he devoted most of his time to investment management and strategy development.

Directorate


Lilian BoyleAlfred da CostaMuriel Dube

Joe PamenskyNigel Payne

Pansy Tlakula

Mathabo KuneneTania Slabbert

Lebogang Mokoena

Doug BandStephen KoseffDonald Masson



Directorate

Committees

Group executive committee

B Joff e (chairman), FJ Barnes, BL Berson, MC Berzack, DE Cleasby,

AW Dawe, SG Pretorius, LP Ralphs

South African executive committee

B Joff e (chairman), MC Berzack, NW Birch, DE Cleasby, AW Dawe,

LI Jacobs, L Madikizela, SG Mahlalela, P Nyman, SG Pretorius,

LP Ralphs, AC Salomon, SA Thwala

Audit committee

NG Payne (chairman), DDB Band, DE Cleasby, RW Graham,

D Masson, P Nyman, JL Pamensky, AC Salomon

Risk committee

NG Payne (chairman), MC Berzack, NW Birch, DE Cleasby,

AW Dawe, B Joff e, D Masson, P Nyman, SG Pretorius, LP Ralphs,

AC Salomon

Remuneration committee

DDB Band (chairman), DE Cleasby, D Masson, P Nyman,

JL Pamensky

Acquisition committee

DDB Band (chairman), MC Berzack, DE Cleasby, B Joff e,

D Masson, JL Pamensky, LP Ralphs

Nomination committee

DDB Band (chairman), B Joff e, JL Pamensky,

MC Ramaphosa, T Slabbert

Transformation committee

LI Jacobs (chairman), MC Berzack, NW Birch, AW Dawe,

MJ Finger, B Joff e, SG Mahlalela, SG Pretorius, LP Ralphs,

T Slabbert, SA Thwala, FDP Tlakula

Board composition Number %

Male 18 78,3

Female 5 21,7

Total 23 100,0

White 17 73,9

Black 6 26,1

Total 23 100,0

Local 21 91,3

Foreign 2 8,7

Total 23 100,0

Executive 11 47,8

Non-executive 6 26,1

Independent non-executive 6 26,1

Total 23 100,0


The strength and fl exibility of Bidvest people allow us to create unique business opportunities

Cyril Ramaphosa Non-executive chairman

Chairman’s statement


Highlights

› Proudly Bidvest has taken on an Asian dimension

› Headline earnings per share rise 20,6% to 970,0 cents per share

› Our staff complement has topped 104 000 for the first time, underlining Bidvest’s position as a major job creator

› The refinancing of Dinatla’s investment has entrenched our empowerment partnership for a further five years

› Corporate brand-building has built strong impetus, underpinned by our people’s propensity for extraordinary achievement

› We have established the basis for a Group-wide sustainability strategy

Introduction

Bidvest continues to innovate and reinvent the

way in which it does business. The dynamic Bidvest

environment fosters an entrepreneurial spirit that

permeates the Group.

Being Proudly Bidvest was showcased as never before

in 2007 as we expanded into Asia via the acquisition of

Angliss with operations in Singapore, Hong Kong and

China. At the same time, growth was again achieved by

our international and South African operations. Asian

workers join a Bidvest family of businesses that stretch

from Beijing to Belgium and from Dubai to Durban.

For the first time, our staff complement has topped

the 104 000-mark, moving from 93 325 to 104 184;

(78 029 to 87 833 in South Africa) a reflection of

our continued growth and the strength of our

commitment to South Africa’s national strategy

of sharing the benefits of improved economic

performance through job creation and the delivery of

new opportunities to working people.

Headline earnings per share rose by 20,6% to

970,0 cents per share while diluted headline earnings

per share increased by 23,2% to 947,2 cents per share.

At 446,4 cents per share, distributions per share are

up by 21,0%.

Broader contributions

Our commitment to our shareholders is well known. In

addition, we strive to make positive contributions to all

our other stakeholders – customers, suppliers, workers

and communities.

We are one of 49 companies in the JSE’s Socially

Responsible Investment Index, and one of only four

South African companies listed on the Dow Jones

Sustainability Index; a series of global sustainability

benchmarks.




Financial results and pure numbers cannot on their

own reflect the impact made by the Group. The sheer

size of Bidvest within the South African context means

that even small percentages have huge impacts on

lives and prospects.

Last year, employee numbers rose 10,0% while

developmental programmes ensured the qualitative

growth of our human capital. Everyday people

continue to achieve extraordinary things at Bidvest.

They shape every aspect of our performance. The

key figures behind our numbers are those of our

employees.

Directors and management applaud the commitment

of our teams and their contribution to another year of

sustained growth.

Succession generation

In operations across the Group, younger managers

are moving into positions of real responsibility, adding

impetus to transformation, making themselves

accountable and illustrating the progress of Bidvest’s

“succession generation”. They benefit from substantially

increased training investment and a consistent strategy

of early identification and incubation of managerial

talent.

A key resource in this context is The Bidvest Academy.

This highly regarded instrument for developing the

Bidvest leaders of tomorrow has been strengthened

by the creation of a graduate academy to ensure

continuing support for the succession generation.

A separate sales programme has also been added to

the national training effort.

Social investment

Our black economic empowered preferential

procurement spend reached R4,6 billion while our

investment in people development in South Africa was

R118,1 million. The size of our workforce makes Bidvest

one of South Africa’s largest engines of transformation.

Corporate social investment totalled R38,5 million

– a contribution that defies simple rands-and-cents

measurement as the process increases the self-worth

and dignity of so many families. Social investment is

not only a corporate commitment; it involves the time,

effort and manpower of thousands of Bidvest people.

The macro environment

Global demand for commodities has benefited

many countries in our region. We see renewed

investment in neighbouring states in the wake of

debt forgiveness and economic reform. We welcome

these developments and the positive effect on the

performance of our logistics operations in several

African jurisdictions. Zimbabwe remains a tragic

disappointment, reversing positive progress elsewhere

in Africa.

The year witnessed a strategic shift within South

Africa – from consumer- to infrastructure-led growth

with higher interest rates applying a brake to consumer

spending.

Sustained GDP growth has drawn attention to key

constraints, including skills shortages and pressure

on all infrastructural elements, notably transport

infrastructure and power supplies. Substantial

investment by government in major infrastructure

projects is under way and welcomed.

New imperatives

Climate change and the environment are becoming

crucial issues – for companies as well as countries. The

key to success will be the ability of far-sighted leaders

to inspire their people by setting out a new vision.

Flexible employment practice is often a prerequisite

for job growth, but companies that hire and fire don’t

do nearly as well as companies that hire and inspire.

Honest, fair-minded and courageous managers who

articulate an inspiring vision get more out of their

employees than short-sighted and self-interested

executives.


sustainability challenge every day in every business.

The process has to be driven by a clear understanding

of what sustainability means for Bidvest as a whole

while respecting operational diversity and recognising

that emphasis may vary from one business to another.

Leadership challenges

Bidvest’s record for uninterrupted growth is

unprecedented. Ever stronger commitments to

sustainability will ensure the record continues. In this

context, the leadership challenge will be to go beyond

change implementation to change anticipation.

For example, climate change is currently low on the

list of risk factors facing business, but priorities may

soon be re-ordered. Certainly, a forward-looking Group

such as Bidvest is becoming increasingly aware of likely

impacts.

Our freight-management business has always been

sensitive to changes in the volume of agricultural

products for delivery. This sensitivity is likely to grow as

climate change potentially increases the frequency and

severity of droughts across Africa.

Our UK foodservice business reports that “food mile”

efficiency and a company’s “carbon footprint” are

becoming critical issues when tenders are awarded.

Here in South Africa, there is a growing sense that

“clean development” and energy efficiency may

become focus areas for legislators.

Soon I expect investment decisions – by countries and

companies – to be governed or at least influenced

by climate change strategies. Bidvest is beginning to

address the issue.

Broad-based black economic empowerment

Our programmes for BEE are a good example of

successful anticipation of developments. We took a

proactive approach from an early date. We did not wait

for the publication of the codes of good practice. We

A decentralised Group such as Bidvest faces special

challenges when building shared purpose. Thankfully,

our corporate DNA produces similar leadership

styles across the Group. Our managers are hands-on

operators who work with their teams rather than stand

over them.

Brand development

Bidvest touches the lives of millions of South Africans

through our comprehensive range of services and

products. Our operational brands – from McCarthy

to Steiner; from Sea World to Waltons – are known

to millions. Yet Bidvest as a corporate brand enjoys

relatively low awareness at consumer level. The

opposite is true in the financial and investment

communities. Bidvest, the corporate brand,

enjoys positive recognition in both domestic and

international jurisdictions. But individual analysts may

fail to appreciate the strength of the divisional brand

bouquet.

To ensure consistently high recognition across all

audiences, we have begun a programme of brand

development encompassing all corporate identity

elements, sponsorship and advertising. A consistent

message is being communicated. Proudly Bidvest is the

unifying theme while the inspiration is drawn from the

ability of our people to achieve extraordinary results

and open up infinite possibilities.

Sustainability

In future, we will need to communicate a unifying

vision with even greater clarity. Fortunately, strong

central themes are already in place, including our

commitment to sustainable business practices and the

empowerment of individuals and teams to become the

best that they can be.

Proudly Bidvest is the foundation on which the Group’s

sustainability strategy is based. A priority for Bidvest

was to establish the groundwork that would move us

beyond sustainability reporting to the job of living the



drafted our own empowerment charter and created

our own BEE scorecard, giving us a head-start. The

Bidvest scorecard has now been realigned with the

new codes.

A key feature of the codes is continued recognition

for BEE businesses under the “once-empowered-

always-empowered” provision. This provision applies to

Bidvest itself and will encourage companies to set joint

ventures free after a nurturing period. Activities high

on people-involvement but low on technology may be

well suited to this approach.

In 2007, perhaps the single most significant BEE

event at Bidvest was the refinancing of the Dinatla

consortium’s empowerment investment, cementing

the successful Dinatla-Bidvest partnership for a further

five years.

Bidvest, a level five contributor with an unconstrained

operational capacity, has a “BBB” empowerment rating

from Empowerdex. Our BEE ownership in terms of the

recently gazetted codes is 26,7%.

Bidvest is an empowerment leader, coming 10th

overall in the 2007 Top Empowerment Companies

Survey. In addition, we were an award-winner in the

inaugural Unity Awards, an initiative backed by major

trade unions.

Governance

Bidvest is committed to sustainable business practice,

triple bottom line reporting and the principles of

good corporate governance. Policies, committees

and reporting protocols are important, but a culture

of honesty is fundamental to long-term success; in

business and in life.

Fraud, corruption, intimidation and dishonesty are

an increasing challenge. To address and cater for the

concerns of all shareholders both internal and external

a free and anonymous ethics line, was relaunched.

We constantly stress our company values of respect,

honesty, integrity and accountability, and are thankful

that our officers and employees have such a high

reputation for ethical practice. Even so, crime is

becoming a major risk area.

HIV/Aids

The ability to affect lives cannot be taken lightly by an

organisation that employs more than 87 000 South

Africans. Perhaps only government touches more staff

members and families with workplace initiatives.

For over a decade, our businesses have reached

innumerable workers through HIV/Aids education,

counselling and other forms of help. These actions

have been undertaken on a decentralised basis, but

have many common themes. Decentralised initiatives

have a major role to play, but it may be possible to add

value by applying lessons from all our businesses and

leveraging Group resources.

Training and development

Our efforts to support personal development

confirm the linkage between economic growth and

broader access to opportunity, the central premise of

government’s Accelerated and Shared Growth Initiative

for South Africa strategy.

One growth area is South Africa’s expanded car

market and one knock-on effect is higher demand

for vehicle maintenance skills. Bidvest has responded

by employing and training a new wave of service

technicians – just one example of economic expansion

unlocking opportunities for personal growth.

Those who show managerial and executive promise

soon find that The Bidvest Academy and The Bidvest

Graduate Academy are highly effective vehicles for

continued development at executive management

level.


A major employer such as Bidvest accepts that to a

certain extent we train for the nation while training

for ourselves. However, talent retention has become

a priority. Our businesses are adopting shadow

management programmes, mentorship, coaching and

succession planning to improve retention of our high

potential staff.

Education

In order to address the huge shortfall in mathematics,

science and technology education in many South

African schools, Bidvest, in partnership with the public

benefit organisation ORT SA, has launched a four-year

R3,7 million programme to improve MST education in

Alexandra.

Our CSI strategy has always had an educational

bias. Many projects have run for years; notably Rally

to READ, the continuing effort to take educational

materials to under-resourced rural communities.

Board changes

Several changes to the composition of the board have

occurred.

Gill Marcus and Bernadette Moffat have resigned. Tania

Slabbert has become a full director. A long-standing

executive member of the board, Colin Kretzmann,

has retired. David Cleasby, Peter Nyman’s successor

as financial director, has become a full director.

Peter Nyman remains an executive director responsible

for special projects. The board expresses its thanks to

the outgoing directors for their contributions.

It is my privilege to head a knowledgeable and

energetic boardroom team. I thank them for their

support over the last year.

The future

Bidvest is positive about prospects for continued

growth. South Africa’s economic fundamentals

remain sound. Competition is intense, but we foresee

opportunities for growth in our home markets across

all divisions.

Our Australia, European, New Zealand and UK

foodservice businesses are well positioned, while new

strategic opportunities beckon in Asia.

Opportunities in Africa will not be neglected. We see

strong potential in Namibia and are consolidating our

Namibian assets into Bidvest Namibia ahead of a listing

that will be domiciled in Namibia and managed by

Namibians.

Brian Joffe Chief executive

Chief executive’s report


Highlights

› The Angliss acquisition gives us direct exposure to the high-growth markets of east Asia and China

› Our international foodservice business is a world leader

› The acquisition of the Viamax fleet management business is complete, implementation effective September 2007

› The Bidvest growth model proves its value for the 18th successive year

› Revenue up 23,8% to R95,7 billion

› Trading profit rises by 24,3% to R4,5 billion

› Headline earnings rise by 20,7% to R2,9 billion

› New investment of R2,0 billion in capital expansion reflects our confidence

› Organisational changes highlight the strength of Bidvest’s succession generation

Introduction

Our results are pleasing, driven by organic growth

and operational excellence. We have maintained our

record of uninterrupted success, with compound

growth in headline earnings per share above 25,0% for

18 successive years. Return on funds employed and

sustained, long-term growth remain the key yardsticks

of our own performance. ROFE remained vigorous at

50,2% while the trading margin was largely stable at

4,8%.

Revenue of R95,7 billion was 23,8% up on 2006 while

trading profit increased by 24,3% to R4,5 billion

(2006: R3,7 billion). Headline earnings were

R2,9 billion (2006: R2,4 billion).

International perspective

Trading profit from our foodservice businesses in

the United Kingdom was disappointing. However,

operations in continental Europe continue to improve.

Higher interest rates, stronger inflation and changes

to the business mix created some challenges for the

United Kingdom operation, but higher growth in

Belgium and the Netherlands contributed to improved

performance by their revitalised management teams.

The acquisition of the largest foodservice business in

Flanders will further strengthen our Belgian business.

We are now the number one player in the Belgian

foodservice market. Substantial growth is, albeit

relatively small in the Bidvest context, continuing in the

hospitality industry in the United Arab Emirates.

The Australian economy continues to benefit from

the global commodities boom and Bidvest Australia

has again registered strong growth. The acquisition

of the Angliss foodservice businesses in Singapore,

Hong Kong and the People’s Republic of China creates

an exciting platform in these high growth markets in

Asia. The New Zealand economy remains flat, but solid

growth is being achieved by our operations.




Bidvest’s foodservice business remains the largest

player in its industry outside of North America.

African perspective

Within the South African market, strong growth is

being maintained and new jobs are being created. The

national outlook remains positive, giving grounds for

hope that our political “miracle” may yet be followed by

an economic one.

However, inflation has increased and we witnessed

a succession of interest rate rises as the authorities

became increasingly concerned by the record level of

household debt.

Within the South African market, inflation increased

while we witnessed a succession of interest rate rises as

the authorities became increasingly concerned by the

record level of household debt.

The cumulative impact was first felt in November and

December 2000, and by year end businesses with

direct consumer exposure were under some pressure.

The implementation of the National Credit Act also

contributed to a slowdown in new vehicle sales.

A decline in the number of hire purchase agreements

may be attributable to the bedding-in of unfamiliar

procedures, but I suspect that we may be seeing the

first stages of a fundamental shift in credit-based

trading volumes within the consumer sector.

Though consumer markets came under pressure, South

Africa’s gross domestic product continued to grow at

a healthy rate as the national strategy of encouraging

greater fixed investment gained momentum. Business

confidence remained high. South African imports

continued at a high level, partly as a result of higher

fixed investment, putting pressure on the rand. The

overall effects for Bidvest were positive as exchange

rate trends helped to swell profits from international

operations.

Many jurisdictions within southern and central Africa –

with the notable exception of Zimbabwe – are engaged

in a process of long-term economic reform. Foreign

investment has picked up, economic growth is being

sustained and trade volumes are beginning to increase.

Afro pessimism has been replaced by optimism, even in

some international investment centres.

We increased our stake in Namsov Fishing Enterprises

in Namibia and strengthened the business through the

complete acquisition of Namsea. Poor catches limited

earnings growth.

In South Africa, low agricultural volumes affected

the financial performance of Bidfreight. At our food

ingredients businesses, corrective action and a

back-to-basics approach are expected to lead to an

improvement in results in the forthcoming year. Bidvest

Industrial and Commercial Products optimised a

supportive macro-economic environment and achieved

strong growth. Contract delays early in the year affected

the overall performance of Bidpaper Plus despite new

business successes later in the year. Intense competition

and the impact of interest rate increases affected

trading income from our automotive business while

volumes at year end were also impacted by the NCA

implementation. Vehicle recall and impairment costs at

GAZ SA were also negative for the business.

Bidvest structures

Our two most significant structural changes involved

Bidvest Australasia and Bidfood.

Strategic growth into Asia and the alignment of these

operations within Bidvest Australasia promoted a name

change to Bidvest Asia Pacific.

During the Angliss consolidation, Bidvest Asia

Pacific will remain on a growth footing in all markets

– Australia, New Zealand and Asia. Our decentralised

business model empowers local management while

encouraging a search for synergies and operational

efficiency. The approach will now be extended to Asia.

Bidfood operations have been refocused, and reshaped

management teams have taken the helm. Bidfood now

comprises three focused divisions: Caterplus, Bidfood


funds. These activities have inflated the pricing of

acquisitions and sharpen the challenge of finding and

unlocking value.

South Africa has only been exposed to the private

equity phenomenon for a relatively short time and

it is doubtful whether all the dynamics of the new

environment are as yet fully appreciated.

Value under scrutiny

Traditionally, boardroom discussions focus on earnings.

In a business climate increasingly influenced by private

equity activities, cash flows and valuations will become

equally important.

Large questions are raised. The valuation methodologies

adopted by private equity investors are sometimes at

odds with traditional benchmarks. Do stock markets

accurately value the assets of a listed business?

Jobs under fire

Costs and jobs are also crucial issues as the private

equity model is frequently driven by cash flows and

the need for short-term cash returns. Every business

has to be efficiently run, but is instant cash generation

an efficient model in a growth-minded business or a

growth-focused economy? Job losses to facilitate a

highly profitable exit will certainly be a “hard sell” in a

jurisdiction such as ours. Radical reductions in training

investment would also cause controversy.

International private equity investors are rarely sensitive

to domestic market issues such as these as the main

driver of these developments is global liquidity

– creating a conundrum for national policymakers who

may want to attract foreign investment, but not at the

cost of local jobs.

Bidvest is in a fortunate position. We don’t have to

chase acquisitions to grow. Continued momentum

is assured by an organic focus and businesses that

remain strongly cash generative even while investing

in future growth.

Ingredients and Speciality. The ingredients division

became operational in April following a reorganisation

that houses all food ingredient businesses within a single

structure. A unified management structure has been

adopted at Caterplus, integrating the management of

our dry food and frozen food services. Lufil, the paper

products business, has been incorporated into Bidpaper

Plus, Hotel Amenities and Accessories is now part of

Bidserv and Vulcan Catering Equipment part of Bid

Industrial and Commercial Products.

Succession success

The structural changes reflect the strength of Bidvest’s

managerial resources. Energetic leadership teams

have taken responsibility without recourse to external

recruitment. There is a knock-on effect down the

reporting lines as younger people move into positions

of responsibility. Bidvest’s “founder-generation” of

owner-managers is being replaced by entrepreneurial

executives who have been developed internally.

This “changing of the guard” is evident across all

our businesses and brings further impetus to our

transformation strategy.

Acquisitions

The Angliss acquisition was followed by the purchase

of the Viamax fleet management and leasing business

from Transnet, South Africa’s government-owned

transport and logistics group. The purchase adds further

momentum to the strategic diversification process at

Bid Auto and became effective in September.

The success of Bidvest down the years has been driven

by a blend of both organic and acquisitive growth. We

will maintain this proven model. Bidvest will continue

buying the right business, at the right price, when the

right strategic fit is evident and where Bidvest can add

value through the application of its entrepreneurial

model. These considerations underpinned both the

Angliss and Viamax transactions.

Private equity

Bidvest is an international company and operates in

a global environment that has been fundamentally

affected by the activities of the major private equity



Privatisation

The question of local versus international priorities is

also relevant in a policy domain such as privatisation.

In smaller economies, policymakers tend to view

privatisation as the sale of state assets to foreigners.

This lopsided perspective should be challenged;

especially in the South African context.

Our corporate sector has benefited from strong

earnings growth. Many local companies have the

resources to engage in substantial transactions. We

should not underestimate the business skills found

within our private sector. Local business is close to local

issues and knows what it takes to unlock local potential

– key considerations when engaging in any turnaround

strategy.

Selling to foreigners is second prize. Local privatisation

transactions to businesses that understand South

Africa’s policy dynamics are much preferred.

Hopefully, our strategic situation will encourage

government to give privatisation much greater priority.

If sustained economic growth is the cornerstone of

official policy then locally focused privatisation is a tool

that cannot be ignored.

Policy direction

Clear policy direction is called for when considering

ways of maximising the private sector’s contribution

to national prosperity, improving South Africa’s global

competitiveness and assisting government with service

delivery.

State monopolies often compete against private

enterprise. If government aims to facilitate job growth,

then companies with high-growth potential cannot

be hobbled by unfair competition such as this.

Government and business should be partners, not

competitors.

Government has a key role in the economy. Where

investment is needed in the national interest,

government can provide it. In high-risk areas where

returns are doubtful, business may be hesitant to

become involved. Government can lead by making the

initial investment and laying the groundwork. But why

would government want to remain in industries where

private sector companies have long demonstrated their

ability to achieve efficiencies and offer improved services?

Policy issues

At some stage, all policymakers have to strike a balance

between the strategic quest for economic growth

and the need to combat inflation. Experience shows

that high growth in a developing economy is rarely

accompanied by low inflation and when a choice has

to be made, developing nations usually opt for growth.

In South Africa, the policy imperative is job creation,

which may induce the authorities to allow the

occasional breach of the 6% inflation “ceiling”. Bidvest

has no major concerns over this long-term policy risk

in view of government’s record for sound management

and our Group’s history of solid returns in a mildly

inflationary environment.

Strategic information

As a large employer and major corporate group we are

subject to strategic planning risks. Our businesses invested

R2,0 billion in capital expansion in 2007. Given less

regulated environments such as ports, investment would

have been substantially higher. Budgetary decisions of

this magnitude are not only based on the experience and

judgement of the board and senior managers, but on the

data available to the decision makers.

Strategic constraints

The ability of some of our businesses to grow is being

constrained by pressure on national infrastructure.

The rate of infrastructure delivery and improvement in

South Africa is therefore a critical issue. This capacity

constraint is usually put into the context of the

transport network, but the issue is wider than this.

Major implications for national growth will result if such

delivery is not addressed.

Bidvest is not an IT company, but we make increasing

use of IT platforms, e-procurement and sophisticated


Our mitigation strategy is to maintain and strengthen

our record as a good employer. The investment in

our people and their working conditions continues,

as does the effort at all business units to maintain

continual two-way communication with our workers

and trade unions.

Social responsibility

Bidvest has been acknowledged by members of the

trade union movement as a responsible employer with

a strong record as a job saver and job creator.

Recognition of our positive role came at the

inaugural Unity Awards, where we were one of only

11 companies to win recognition. The benchmark is

not only profit but job creation, skills transfer, economic

and social contributions, employment conditions,

affirmative action, environmental practice, health and

safety standards and corporate governance.

Accolades for socially responsible investment are new

in South Africa and we were proud to feature among

the first winners.

Challenges

Building and retaining a national skills-base is a

challenge for every developing economy. South Africa

is no exception. It is one of the ironies of the new

millennium that supposedly “backward” Africa has

emerged as a major incubator of talent for developed

Europe and North America.

Top performers are desperately needed at home.

Highly skilled people build high performance

economies. With prosperity and security in place

you keep talent in place. The process takes time, a

commodity that’s in short supply as talented people

also tend to be mobile and impatient. This delay

brings added urgency to the task of every government

in Africa to not only set the policy framework but

accelerate policy implementation. If you don’t start

moving as a nation many of your most talented people

will start moving as individuals.

management information systems. Limited bandwidth in

the South African regulatory environment has not been a

constraint for us in the past, but could be in future.

Every industry is becoming a segment of the

e-economy. Future earnings at every business in South

Africa could soon be sensitive to bandwidth availability.

Official statements on the need to bridge the digital

divide indicate that government is alive to the

challenge. Hopefully, the issue will receive increasing

priority; especially as greater bandwidth availability is

a prerequisite if South Africa wishes to position itself

as the economic hub of Africa and the preferred Africa

base for international business.

National DNA

South Africans are becoming accomplished change

managers, but when reinvention involves the entire

country, the leadership task can be increasingly

challenging. However, precedents such as the

Malaysian turnaround suggest that huge benefits are

possible when the right choices are made.

Business risks

Organisational culture is a risk factor; especially if hubris

threatens to set in. Bidvest needs to maintain a culture

of humility notwithstanding our continued success.

The single common characteristic of successful Bidvest

managers is their practical, no-nonsense attitude to

the job. Don’t dictate to your workers, relate to them.

Thankfully, our senior people ensure this lesson is

absorbed by the up-and-coming generation of leaders.

A risk factor for any large employer is the industrial

relations climate. In South Africa we have recently seen

a wave of strikes and industrial unrest, often motivated

by political considerations not industrial. Despite

rising inflation, our companies have been passing on

positive wage increases for some time. Furthermore,

the workplace conditions at our businesses are often

the envy of the industries concerned. Better conditions

have proved to be no defence against strike action and

more industrial action cannot be ruled out.



Business also faces the talent retention challenge.

Growth-minded businesses are learning that you can’t

simply train; you must also retain.

Educational investment

The starting point on the skills path is the education

system and South Africa’s education investment is at

one of the highest levels in the world. Delivery remains

a challenge particularly in the fields of Maths and the

Sciences.

We are confident that sustained investment in

education will pay dividends and at least some

of our skills shortages will ultimately ease as our

young people grasp the opportunities that are now

available to them. It is up to business to complement

official policy through sustained social investment in

education, the focus of Bidvest’s social investment for

some time.

Black economic empowerment

Our empowerment partners in the Dinatla consortium

have successfully refinanced their investment in

Bidvest, ensuring the continuation of a highly

successful partnership.

Since this relationship began, our market capitalisation

has grown from R13,0 billion to R48,4 billion,

– substantially increasing the value of Dinatla’s

investment while confirming that BEE represents a

major opportunity for those with a proactive approach.

Empowerment is a strategic business imperative

and the financial aspects of BEE at Group level are

important, but over time the impact at subsidiary

level becomes the key element. New entrepreneurs

and joint venture partners, ambitious executives and

diligent workers have to see day-by-day transformation

of their prospects.

Broad-based transformation is entrenched at Bidvest

and we are determined to maintain momentum

as reflected in our total spend on enterprise

development, BEE procurement and training.

Appreciation

The Bidvest team continues to grow. We employ

104 184 people locally and around the world; a

mixture of seasoned Bidvest performers and new

faces, all making diverse contributions in decentralised

operations on four continents. The common thread is

“Proudly Bidvest” as our people take pride in their work,

their businesses’ performance and their own ability to

make a difference within their communities.

Bidvest people are a remarkable team. Give them a

chance and they invariably make the most of it. Many

were once employees of underperforming companies.

Today they are industry leaders. I salute every one

of them and their infinite capacity for transforming

the ordinary into the extraordinary. I thank them for

another year of sustained growth.

I also extend my thanks to management for a year of

unstinting effort.

I say farewell to long-standing colleagues

and members of the senior executive team,

Colin Kretzmann and Dave Rosevear. I welcome David

Cleasby, who succeeds Peter Nyman as financial

director; part of a wave of younger managers in the

Group.

I thank the members of our board for their contribution

and support. Sustained growth through two decades

would not be possible without astute strategic

direction from our directors.

The future

The environment is generally favourable in the markets

in which Bidvest is represented.

South Africa is enjoying the longest run of sustained GDP

growth in managerial memory, a situation we believe will

continue up to and beyond the 2010 Soccer World Cup.

We therefore see opportunities for sustained growth.

Tackling crime has to be South Africa’s top priority. We

also have to free the bottlenecks to sustained growth

wherever they occur, be they skills shortages, pressure


on transport infrastructure or power generation

capacity. Action will enable growth industries to keep

on growing. The private sector has a role to play with

government in alleviating those bottlenecks. With

tightening credit conditions and rising local inflation,

management’s focus at Bidvest will be on rigorous

cost containment and absolute attention to asset

management.

A new, positive mood is evident in many parts of Africa.

We believe business has a responsibility to contribute

to positive change in our home continent by

encouraging the development of local capital markets

and showcasing the benefits of the entrepreneurial

business model.

Specifically, we see strong potential in Namibia and

have consolidated our Namibian assets in preparation

for a Windhoek listing. We are confident our Namibian

operations are well positioned to benefit from an

increasingly supportive policy environment.

In Europe we are confident our growth objectives

will be achieved. The United Kingdom operation has

adjusted its business mix and secured major account

gains while we see encouraging progress in both the

Netherlands and Belgium.

Bidvest Asia Pacific has made huge strides. We are

the national leaders in foodservice distribution in

Australia and New Zealand and are poised to unlock

considerable opportunities in Asia.

Management is committed to ensuring that Bidvest

will be in a position to deliver superior results for the

year ending June 2008. Our 2005 strategic objective

of doubling the size of Bidvest in five years remains on

track.

David Cleasby Financial director

Financial director’s report


Highlights

› Two substantial acquisitions were completed – Angliss and Viamax – though the Viamax transaction will be effective in September 2007

› For 18 years, annual compound growth in headline earnings per share has exceeded 25%

› Cash flows generated by operations remain strong at R4,2 billion

› Wealth creation of R17,0 billion (R14,1 billion) was registered

› Income attributable to shareholders rose 13,0% to R2,7 billion (R2,4 billion)

› Basic earnings per share growth of 12,9% to 899,4 cents

› The stance on debt remains conservative, creating capacity for further acquisitions and continued infrastructure investment

Introduction

Our trading results were solid, reflecting good

contributions from our Australasian operations backed

by strong results from our South African businesses,

particularly Bid Industrial and Commercial Products.

Interest paid on borrowings increased significantly,

impacted by the full effect of the 250 basis point

increase, increased working capital and capital

expenditure to fund growth combined with weaker

asset management.

Two significant acquisitions were concluded: the

purchase of Angliss, a leading Asian foodservice

business, and the purchase in South Africa of the

Transnet-owned Viamax fleet management and leasing

business. The Angliss transaction had no material affect

on overall results in 2007. Organic growth and ongoing

efficiency gains drove Bidvest’s performance, resulting

in trading profit of R4,5 billion and revenue growth of

23,8% to R95,7 billion.

Headline earnings per share were pleasing at

970,0 cents (2006: 804,6 cents). Basic earnings per

share growth of 12,9% to 899,4 cents was impacted

by the impairment of the Group’s investment in

Tiger Wheels Limited of R178,3 million. Tiger Wheels

Limited was suspended on the JSE, SA following the

announcement that its 74%-owned subsidiary, ATS,

was unable to gather support from its funders to

continue operating.

Offshore financial performance

The rand’s weakness versus sterling, the euro and

the Australian and New Zealand dollars augmented

our international profit. Strong organic growth was

maintained in the Australian and New Zealand markets.




The Angliss transaction in Asia was concluded late in

the period, but is expected to make a material profit

contribution in 2008.

Significant write-offs for bad debt and the loss of the

Ministry of Defence contract affected the performance

of our British foodservice business. Remedial action

has been taken, which includes the use of credit

insurance and replacement of the lost revenue.

A strong contribution was made by operations in the

Netherlands and overall improvements were noted in

Belgium.

Performance in South Africa

Bid Industrial and Commercial Products achieved

pleasing growth, with trading profit up by 48,7% and

revenue up 23,8%.

Bidserv grew trading profit by 19,0% on a 16,2%

revenue increase – a creditable performance after

strikes in the security and cleaning industries.

The development of a high-quality portfolio at Bid

Property Holdings has helped Bidvest to retain control

over strategic operational properties.

Acquisitions

The acquisition of Viamax will add considerable scale to

Bid Auto’s fleet management business, but regulatory

approvals has delayed the effective implementation

date.

In May we acquired 100% of the issued share capital

of Angliss Singapore, Angliss Hong Kong and Angliss

China for US$80 million. These foodservice wholesale

and distribution businesses have combined sales of

more than R2,1 billion a year. Angliss owns facilities

in Singapore, Hong Kong and Guangzhou and has

distribution platforms in Beijing and Shanghai. In the

two months to 30 June, Angliss contributed trading

profit of R10,8 million.

The acquisition was funded by debt raised in Australia.

The purchase price of the Viamax transaction of

approximately R1 billion is based on the operation’s

net asset value at 31 March 2007 and a premium

of R36 million. The transaction will be funded from

existing Group resources.

In addition, Bidvest acquired 20% of Comair, the

JSE-listed airline group that operates the southern

Africa franchise of British Airways. The investment

was opportunistic. South Africa’s airline market shows

continued growth and we expect this investment to

perform well over time.

We made an unsuccessful bid for a major US food-

service company. We decided not to pursue an

interest as valuations moved to levels we considered

unrealistic.

Debt levels

Bidvest is borrowing more, a development that enables

us to take greater advantage of our strong balance

sheet. Funding is not only used for growth, but to

maintain our investment in infrastructure to sustain our

ongoing operations. However, our position on debt

remains conservative.

Traditionally, our debt-to-equity ratio has been below

40%. Net debt rose to R3,7 billion, though interest rate

cover at eight times reflects the Group’s significant

borrowing capacity.

Our credit rating of AA-(zaf ) was affirmed by

Fitch Ratings in March, confirming the Group’s realistic

approach to leverage.

Bidvest’s acquisitions strategy has never been

governed by a policy of maintaining a prescribed

percentage of onshore and offshore holdings. These


to approximately R40,0 million in added interest.

The projected cost of a further increase of 1,0% is

approximately R48,0 million.

Capital market funding

Changes in the interest rate climate spotlight the need

for competitively priced funding, including access to

the debt capital market where appropriate. In May,

we set up a domestic medium-term note programme,

enabling us in due course to raise a total of R4,5 billion

in corporate debt from the South African capital

market.

An initial tranche of R1,5 billion was raised in August.

The timing of future bond issues will be determined by

the direction of interest rates and liquidity risk in both

international and domestic markets.

Our corporate bond issue will also have the effect

of further diversifying our borrower base. The DMTN

programme is a key element in our strategy of securing

optimum funding efficiency and will assist us in

repricing certain fixed loans outside of the banking

market.

Business risks

Risks are well managed, both at a corporate and

operational level. The economic environment in South

Africa is becoming more challenging and the risk

of significant credit default is expected to grow. All

operational units are showing increased vigilance.

Exchange rate risk is well controlled. We are a trading

business and cover our currency exposure on all

imported goods as we prefer not to court exchange

rate risk. Some risks are unavoidable, however, as

currency exposure is inherent in some business

models; for example, marine services where all charges

are US dollar-denominated. Operational management

activities are driven by value opportunities as, when

and where we identify them. However, we need to

maintain a better balance of on- and offshore debt

levels.

Relative to international earnings, our offshore

borrowings have been small as we used offshore cash

generation to pay down offshore debt. We are looking

to achieve an improved balance of on- and offshore

debt without affecting our financial “firepower”.

Acquisitive freedom

One reason for our largely conservative attitude to

debt is our desire to retain our ability to carry through

sizeable acquisitions. We remain an opportunistic

and acquisitive company, and freedom to manoeuvre

remains important to us.

Philosophical issues also come into play. South African

business has gone through periods of high volatility,

creating an aversion of heavy debt. Gearing up in the

good times may appear to be positive, but can lead

to missed opportunities in the bad times. In Bidvest’s

experience as an acquisitive company, some of the

best opportunities occur during a challenging business

environment. We wouldn’t want to miss them.

Interest rates

Interest rates continued to harden, both in major

international markets and in South Africa. By June 2007,

increasing inflation and credit extension had prompted

the South African Reserve Bank to increase rates

by 250 basis points since June 2006. However, our

conservative stance on debt ensured we were well

positioned to weather these increases in the base rate.

This is not to say we were unaffected. The cost

of interest rate increases of 250 basis points over

the 14-month period to 30 June 2007 amounted



has many years’ experience of trading within these

parameters and the risk is not considered excessive.

Bidvest’s track record indicates that our decentralised

business model mitigates business risk. Our managers

are accountable for performance in a range of

industries in various geographies. Conditions may

be challenging in some environments, favourable in

others. The result on balance is stable, above-average

and sustainable returns.

A moderate rise in inflation does not pose increased

business risks as trading activities traditionally benefit

in such an environment as customers tend to maintain

higher stock levels.

Our sensitivity to fluctuations in interest rates,

exchange rates and inflation is not regarded as an area

of weakness in view of the broad range of our activities

and our wide geographic footprint.

Sustainability

We are committed to triple bottom line reporting. All

our activities are underpinned by the need to build and

maintain our sustainability profile through investments

in people, planet and profitability.

Incentivisation

We have introduced a share purchase scheme as a

means of further aligning the interests of shareholders

and management. Senior managers who participate

in the scheme are obliged to buy shares; it is not an

option. The arrangement is an efficient mechanism for

long-term management incentivisation.

Our share buy-back programme was launched three

years ago to eliminate the danger of any dilution in

shareholder value as a result of our empowerment

transaction with the Dinatla consortium. No further

share buy backs are anticipated unless a pricing

opportunity presents itself.

Dinatla refinancing

In December, Dinatla refinanced their investment in

the Group. Bidvest helped to facilitate the arrangement

at a R350 million net cost. The transaction ensures

a continuation of our partnership and the first

distributions have been paid to members of the

consortium. The benefit of Bidvest’s facilitation of the

transaction is reflected in the increase in the diluted

headline earnings per share of 23,2%.

Under the refinancing arrangement, our subsidiary,

BB Investment Company bought 18 million shares from

Dinatla at R79,38 a share for R1,4 billion. The R1,3 billion

balance of Dinatla’s indebtedness was funded by

Investec Bank Limited. To enable Dinatla to obtain

financing on this amount, Bidvest granted Dinatla a

put option against Bidvest covering 15 million Bidvest

shares at R75 a share. The option is only exercisable

should Bidvest shares fall below R75. Dinatla may

only sell its Bidvest shares to Bidvest, which has a pre-

emptive right over those shares until December 2011.

Legislative changes

The National Credit Act was implemented on

1 June 2007 and had an immediate effect on Bidvest

businesses with direct exposure to the retail market,

principally Bid Auto. The effect in 2007 was minimal.

However, we anticipate some financial fallout in 2008.

The knock-on effect on South African operations

trading in the business-to-business environment will

take longer to materialise.

The phasing out of the secondary tax on companies

was announced in the February Budget to lower the

cost of doing business in South Africa. The intention

is laudable. Unfortunately, government will replace

STC by a tax on shareholders. The changes will affect

distributions from October when the first phase of the

new system will be implemented – a reduction of STC

from 12,5% to 10,0%.


As an international company, Bidvest also welcomes

efforts to align South African corporate practice with

international norms. It is only prudent to examine

safeguards to protect local companies from the

financial scandals that have afflicted some international

groups and their professional advisers, prompting new

measures to ensure audit committee independence

and guard against undue influence by executive

directors.

However, a prescriptive approach to audit committee

composition – as set out in the Corporate Laws

Amendment Act – may prove impractical. In South

Africa’s situation, micro-management of corporate

governance by well-intentioned lawmakers creates

an unnecessary level of complexity. We contend

with shortages of auditing skills while non-executive

directors with experience of leading large groups face

major calls on their time. Executive directors help to

ensure the proper working of an audit committee. They

are facilitators, not manipulators.

Corporate governance is not a last line of defence

when criminal law fails to deter theft and fraud. These

structures promote ethical and efficient company

operations by those whose track record and personal

standing provide strong reassurance that honesty

and fair-dealing will prevail. A corporate rogue who is

undeterred by the criminal law will not be thwarted by

elaborate governance provisions. A balanced approach

is required to ensure that corporate practice facilitates

wise stewardship without impeding the inner workings

of the organisation.

The future

Our businesses, in international and African markets,

are well positioned for further growth. New investment

will be maintained as will spending to service our

expanding infrastructure.

The second phase is scheduled for introduction in

the first half of calendar 2008 when we can expect to

see a dividend tax on shareholders, administered as

a withholding tax at company level. Conversion to a

dividend tax collected at shareholder level is expected

by the end of 2008.

No details are yet available on government’s

compulsory pension scheme for lower paid workers.

The impact could be significant as many of our

businesses have created jobs at the lower end of the

pay scale. Government reportedly hopes to introduce

its national social security fund by 2010. Extensive

consultations are expected in the interim.

Company law

Two additional pieces of South African legislation

have recently been in the spotlight: section 38 of the

Companies Act and the Corporate Laws Amendment

Act.

We welcome changes to company law that will

enable a business to embrace new partners and

permit participation by historically disadvantaged

South Africans at shareholder level. Common sense

protections will ensure long-term business viability

is not compromised when giving financial assistance

to new partners. Our legislators were also wise

in addressing the issue of protection for existing

shareholders by insisting that shareholders have the

final say on assisted transactions.

The requirement for 75% shareholder consent will

not only promote amicable relationships in the post-

transaction period, but act as a safeguard against attack

by parties seeking short-term advantage rather than

the long-term good of the company and established

shareholders.



The management of risk will be critical in all markets.

However, our teams are known for achieving good

results in all types of economic conditions and we are

confident of our ability to perform in a higher interest

rate environment.

The balance sheet remains exceptionally strong. We

have the resources for further acquisitions, though

the focus in our automotive and Asian businesses

will be on consolidation and synergies in the wake of

substantial acquisitions in 2007.

Personal note

This is my first report as financial director and first

opportunity to salute my predecessor Peter Nyman. He

set the benchmark for financial stewardship at Bidvest.

Unassuming, but painstaking, he was known for down-

to-earth humility even when reporting stellar results.

I am proud to follow in his footsteps.


Turning ordinary businesses into extraordinary performers through the actions of passionate Bidvest people


Brian JoffeChief executive

The Group’s corporate offi ce, based in

Melrose Arch, Johannesburg, provides

strategic direction and services to the

Group, houses investments, adding

value through identifying opportunities

and implementing Bidvest’s

decentralised and entrepreneurial

business model.

Value propositionCorporate Services facilitates growth and value creation through the early identifi cation of opportunities and the effi cient leverage of Group resources. The application of a consistent and cohesive strategy removes duplication and provides an empowering environment for decentralised operations.

Bid Corporate ServicesBid Corporate Services complemented its oversight of strategic investments and international interests with intensive work on funding efficiency and the pursuit of acquisition opportunities.

The Angliss and Viamax transactions were taken to a successful conclusion. However, the possible acquisition of a major US foodservices business was not pursued as it would have been value-detracting.

To diversify our borrower base and further improve funding efficiency, a domestic medium-term note programme has been set up, leading in August to the first issue of Bidvest bonds.

Leadership development, communication and sustainability strategy, brand development and investor relations remain key focus areas.

All stationery, signage and vehicle liveries worldwide now carry the Proudly Bidvest slogan. In the South African home market, our sponsorship of Bidvest Wits Football Club has significantly increased corporate brand recognition among black sports fans while increased advertising investment has boosted general brand awareness.

The successful BEE partnership with Dinatla was the catalyst for a sustained effort to build wider awareness of the Bidvest brand. More recently, closer linkage of the corporate and operational brands has become the focus area of this ongoing initiative.

Divisional feedback indicates growing success with the communication of core messages; specifically Bidvest’s status as a BEE leader and the Group’s commitment to business sustainability.

Reinforcement of sustainable business practice is ongoing while communication platforms with all stakeholder groups are continually reinforced.

The Bidvest Academy, the touring campus for the development of a new generation of Bidvest leaders, was further strengthened by the launch of a graduate academy to foster continual management development.

> Development of good quality property

portfolio off ers strategic benefi ts

> 20% of equity of JSE-listed airline group,

Comair, acquired

Review of operations – Corporate Services

CorporateServices


4,5%

Contribution to Group trading profit2006: 3,0%

In addition, sales orientation and sales management courses have been developed for national roll-out. The strategic aim is to make every Bidvest department a sales department.

The development of Bidvest people at all levels is a major theme of our sustainability strategy. Key attributes in the corporate DNA are being supported, notably the chemistry that turns the ordinary into the extraordinary.

Over two decades, the capacity for achieving extraordinary outcomes in humdrum industries or unpromising circumstances has been a defining characteristic of Bidvest people. Appropriate developmental strategies to ensure the long-term continuation of this happy knack are an important area of future focus for Corporate Services.

Bid Property HoldingsAs predicted, South Africa’s commercial and industrial property market has continued to strengthen, though high activity levels have resulted in growing pressure on building costs. The annual rate of increase, in excess of 18% per annum, far outstrips the general level of inflation. Shortages of some building materials and construction sector skills are being experienced. Price increases for materials are being notified on a regular basis.

Pressure is exacerbated by a shortage of land for development and capacity constraints at local government level that slow the rate at which essential services are provided and put a brake on the land proclamation process. Across the industry, disproportionate rental increases compared to historical increases are being applied as leases come up for renegotiation and the “catch-up” effect comes into play.

The prices at which Bidprop bought and developed land as recently as three years ago are today regarded as “historical”.

The development of a high-quality portfolio has helped Bidvest to retain control over strategic operational properties and cushion the effects of disproportionate rental increases. Landlords are taking advantage of a boom in rentals which has not been experienced in the past 30 years.

Motor property developments for McCarthy include two joint ventures in Pretoria for the Mercedes brand. A new Lifestyle flagship showroom/workshop for Mercedes in Menlyn Pretoria is under construction as is the new


Midrand home of the Lexus brand. A new Nissan truck showroom and workshop has been completed in Alberton, Gauteng.

Phase two of Safcor Panalpina’s airfreight distribution centre at OR Tambo International Airport has been completed to world-class specifications. It is one of the largest facilities of its kind in Africa. G. Fox has moved into its new head office and distribution centre, situated near the N3 motorway in Johannesburg.

The purchase of three existing properties has further strengthened the portfolio. We have bought premises presently occupied by McCarthy Toyota N1 City in Cape Town and warehouse facilities to support the specialised paper and chemical handling operations of Rennies Distribution Services in Johannesburg.

Work has begun on several large-scale developments in the Western Cape as we continue the strategic task of providing modern and much-expanded premises for rapidly growing divisional operations.

In response to the land shortage challenge, we are constructing much higher warehousing facilities. Provision of in-house generator capacity has become a key design specification in response to electricity supply challenges across the national grid.

The management and maintenance of properties in the portfolio has become a focus area to ensure the optimum long-term performance of increasingly valuable assets.

In the coming year, we expect a continuation of the current market drivers – rising costs, increased interest costs and pressures through non-availability of land and shortages of skills and some materials. These pressures may well contribute to a market “slowdown” in the industrial/commercial property sector.

Namibian fishing enterpriseThe business was significantly expanded in the second half of the year by a series of transactions that have increased our control over a bigger portion of fishing quotas. The effect is to foster price stability and mitigate some of the consequences of long-term pressure on Namibia’s fishing resources.

Bidvest increased its shareholding to 59% of Namsov, Namibia’s leading horse mackerel fishing business. Namsov continues to own a 75% stake in a monk-fish operation, Twafika Fishing Enterprises. The remainder of

the equity is owned by our local trade union partners, Labour Investment Holdings. The status of Namsov Industrial Properties, a wholly owned Namsov subsidiary, is also unaffected by recent transactions.

The changes involve Namsea and a new joint venture. On May 21 2007, Namsov increased its 70% ownership of Namsea to 100%. Namsea focuses on pilchard fishing. The transaction resulted in full ownership of the Namsea subsidiary United Fishing Enterprises and its Atlantic Harvesters business unit (a horse mackerel quota-holder).

In January 2007, a shelf-company was acquired and rebranded as Trachurus Fishing. Subsequently, 49% of the new entity was sold to four smaller quota-holders, in effect creating a joint venture company while consolidating important horse mackerel concessions.

These transactions build on existing contractual arrangements and reinforce long-standing working relationships. The new structures respect legislative requirements that create strong linkages between quota control and vessel ownership while strengthening the overall market position of Namsov. Full acquisition of Namsea also ensured that 200 jobs were saved.

Revenue of N$454,0 million at the expanded business moved higher (2006: N$378,4 million) while trading profit of N$87,4 million (N$75,8 million) was also up. When the effects of the Namsea acquisition are stripped out, revenue of N$393,0 million was recorded while trading profit stood at N$75,7 million.

Flat performance is attributable in the main to continued pressure on Namibia’s fishing resource. The key measures in the fishing business – total allowable catches and quotas – are somewhat below last year’s figures.

A further challenge was created by constant fuel price increases as fuel accounts for 35% of our operating costs.

The record prices achieved for our catch, a key benefit of greater price stability on the back of quota consolidation, compensated for the reduction in quotas and catch rates.

Higher prices also reflect Namsov quality. We differentiate ourselves as Namibia’s most efficient fishing fleet and suppliers of the nation’s best quality horse mackerel.

Review of operations – Corporate Services


This reputation is supported by continuing investment in our mid-water trawlers. Over four years, N$55 million has been invested on larger freezing capacity for our vessels while increasing the size of the stocker ponds and holding tanks. The use of flow ice ensures the fish is chilled just after it is caught and kept at low temperatures until being processed and frozen. The result is improved quality, optimum selling prices and entrenched status as Namibia’s preferred horse mackerel supplier.

The company’s social commitments are also a source of pride. Since 1990, Namsov has contributed N$17,5 million to community development, education, health and welfare in Namibia, an unsurpassed record for consistent social investment.

Our challenges relate to HIV/Aids, skills shortages, constant pressure on fish resources and the dearth of suitable vessels to augment our fleet.

We ensure Namibians account for 55% of our crews and give an industry lead in resource management, liaising closely with government on quotas and good fishing practice to protect young fish and those in the process of spawning.

In future, continued pressure on turnover is anticipated as we are committed to responsible management of the fish resource. We plan to increase efficiency while exploiting opportunities for expansion into Angolan waters. The full-year effect of Namsea’s pilchard-fishing operations will also be felt in 2008. Opportunities for aquaculture will be examined while the possibility of adding two more vessels to the fleet will be pursued, though it may mean going as far afield as the Ukraine.

Ontime AutomotiveThere are five contributors to our UK-based Ontime business: Ontime Rescue and Recovery, including the Fleet Assistance unit (vehicle roadside assistance), Ontime Parking Solutions (outsourced parking enforcement for local authorities), Specialist Transport Operations (enclosed vehicle transport), Prestige Vehicle Distribution (worldwide distribution of high value vehicles) and Volume Distribution (domestic car distribution).

Ontime achieved the anticipated benefit of last year’s disposal of a loss-making French car transport subsidiary. However, the full-year effect of the loss in 2006 of a major technical services contract had a substantial negative impact on the business.

Performance was further inhibited by a combination of macro and industry factors.

The strong British pound put a brake on vehicle exports to the United States while higher interest rates reduced the local consumer’s appetite for debt, affecting car production volumes. This has further sharpened competition in an over-traded vehicle distribution sector.

Significant losses were experienced in our national car delivery business, necessitating remedial action. A new management team has taken over at the volume distribution business, though the effect of the changeover will not be felt for some months.

Ontime Automotive has taken an industry lead by renegotiating and re-pricing contracts to obtain a fair return for quality service. Some business has been lost, but several important successes have been achieved.

In this challenging environment, Ontime’s turnover remained stable and the business reached break-even by year end, a neutral result that masked some pleasing performances by individual businesses, notably in the Specialist and Prestige distribution divisions.

Across all contributors to the business, management is confident that business-specific constraints to improved performance are being addressed, though industry-specific dynamics may persist for some time. Our pricing model, based on sustainable value, is achieving some success, however, creating a platform for improved performance.


Anthony DaweChief executive

Review of operations – Bidfreight

Value proposition

Bidfreight’s assets and capital enable it to operate

as a strategic partner with its customers – often

major importers and exporters who require support

for prolonged periods and at high volumes across

changing business cycles. Bidfreight is in the right

place (every major regional hub) and has the skills and

infrastructure to create effective freight management

solutions for a broad customer base.

Macro factors

In general terms, Bidfreight does well when South

Africa does well. Continued Gross Domestic Product

growth above 5% was therefore positive for the

business. South Africa’s appetite for electronic goods

and Chinese imports supported volumes in some

businesses. However, uncertainty about the size of the

maize crop due to continuing drought had a negative

impact on our agricultural volumes. Maize volumes

were low, though they picked up in the last two

months.

Constant increases in the cost of fuel have raised

operating costs. The higher the oil price, the greater the

demand for alternative, renewable sources of fuel such

as maize and other agricultural products as raw material

in ethanol production. This alternative use of maize may

impact on our volumes in coming years.

The rise of interest rates by 250 basis points between

June 2006 and June 2007 was beneficial for interest

earnings. Interest rate rises also sharpened the need for

rigorous credit and cash-flow management.

The national strategy of infrastructure-led growth is

obviously good for South Africa, but some perverse

effects were felt at the dockside. Rocketing local

demand for steel for construction purposes put the

brake on steel exports, affecting Bidfreight volumes.

To feed construction demand, we witnessed greater

imports of cement, but these volumes were relatively

low and certainly did not cancel out the effect of the

slowdown in steel exports.

> Trading profi t grew 11,2% to R596,4 million

> Revenue increased 20,3% to R19,0 billion

> Capex expenditure of R268,6 million

> Cost management and effi ciency gains focus

areas

> Real wage increases for employees

The leading private sector freight

management group in sub-Saharan

Africa, consisting of several independent

businesses focusing on freight terminals,

international clearing and forwarding,

logistics and marine services.


13,1%

Contribution to Group trading profit2006: 14,7%

Challenges of national growth

South Africa’s growth challenge is most starkly

illustrated in its freight management sector. Higher

imports and exports and sustained GDP growth

translate into pressure at the ports where more

berthing space and improved landside access

are urgently needed. At the same time, roads are

becoming increasingly congested.

The problem of chokepoints at some ports and

bottlenecks on some roads is well known to national

strategists and they are to be congratulated on

canvassing a wide range of expert opinion in their

search for optimum solutions.

Planning and consultation have to be followed by new

investment and urgent implementation. Government

has shown its willingness to increase the level of fixed

investment. Rapid action on the ground would soon

ease some of the congestion.

The private sector is challenged to give a lead with

its own infrastructure development while deploying

smart solutions to ensure that current capacity is

used at maximum efficiency. In November Bidfreight

subsidiary, South African Bulk Terminals, commissioned

South Africa’s largest and most efficient ship unloader,

demonstrating that we have taken up this challenge.

Growth pressures have taken capacity utilisation at

some Bidfreight facilities to well over 95%. Expansion

is urgently required, but cannot proceed until public

sector initiatives take shape and official approvals for

specific Bidfreight projects are forthcoming. Until then,

the business will benefit from extremely high utilisation

levels.

The advantage of strategic location at major logistics

centres has been underlined by the recent pattern of

significantly enhanced inflows, whether in the form

of liquids, bulk cargo or containers. Having storage

capacity in place is vital; as is the ability to achieve

efficient throughput rates.



We trust that rapid progress will be made by

government on the work of converting blueprints

into physical infrastructure. Congestion and capacity

constraints at key facilities have serious consequences

for all players in the logistics chain and for the nation

at large.

Risks

All Bidfreight operations have formal risk committees

which meet regularly and inform management of any

areas of risk.

Business risks have not changed, though some have

come into starker focus.

The scale of our operations is a source of both

vulnerability and reassurance. Bidfreight’s major clients

often need to meet strategic needs and work to long-

term timeframes. Bidfreight operates as a strategic

partner of many customers, which means we share

information and plan accordingly.

To capitalise on economic growth, many South African

companies have launched expansion plans. Growing

companies need to employ more good people.

Recruitment activity picks up and “head-hunting”

intensifies. On the surface, all companies are affected

by the same risk of losing good people, but some more

than others.

Bidfreight is known to train well and develop self-

reliant managers and specialists who get the job done.

Bidfreight people therefore become prime targets. One

result internally is constant pressure on remuneration

levels in key categories. Bidfreight has responded by

putting more emphasis on talent retention. In future,

we will strongly communicate the fact that we offer

the best career development prospects in the industry.

HIV/Aids has intensified as a key business risk. Many

activities in our business require physical strength

and the ability to concentrate for long periods. Both

attributes can be affected by the progress of HIV/Aids.

We are therefore stepping up our counselling and

support activities while looking at new ways of

improving workplace safety and working practices.

Bidfreight is both a collaborator with and competitor of

several state agencies. We acknowledge that this leaves

us vulnerable to unilateral action by powerful public

sector companies. However, working relationships

with Transnet (South Africa’s state transport agency)

and, in particular, the Transnet National Ports Authority,

are good. The national situation also argues against

one-sided policy-making. In high-growth South Africa

it is important to optimise all resources rather than

favour one player at the expense of another.

Sensitivity analysis

Bidfreight is a derived demand business. The call on

our facilities is determined by demands felt across both

the national and international economy; for example,

the world demand for commodity exports or the

demand within southern Africa for maize following a

prolonged drought.

We are therefore sensitive to external events to a

degree that it is difficult to foresee or calibrate. Any

change at macro levels can result in a dramatic shift in

our volumes, either up or down. Across the business

as a whole there is no precise relationship between a

shift in a key variable and company performance as

Bidfreight volumes are balanced across imports and

exports, airfreight and seafreight, consumer goods and

commodities, luxuries and necessities. One variable

may be negative for one part of our business, but

positive for another.

Proudly Bidvest

The Proudly Bidvest slogan is becoming an important

tool. The positioning is relevant in the context of talent

retention and career prospects. Personal development

through training and access to The Bidvest Academy

also plays an important role.


All Bidfreight operations are strong brands in their own

fields. Brand equity has been built up over many years.

Each of the operation’s brands is linked to the Proudly

Bidvest slogan. The slogan is emblazoned on buildings,

silos, equipment and vehicles. The largest Proudly

Bidvest logo in the country (12m x 17m) is on the SABT

agricultural silo at Maydon Wharf, Durban.

Differentiation

Bidfreight is the largest private sector freight

management company in southern Africa with the

ability to act as the long-term partner of major groups

with logistic needs that extend over a 10 or 20 year

planning horizon.

Stature and the strategic location of our assets

underpin the value proposition, but increasingly the

accent falls on agile solutions and innovation that meet

the needs of clients large and small.

Corporate structures

No new acquisitions took place and no disposals

occurred.

A year ago, we disposed of British and European assets

and simplified the structure of our southern African

businesses. The flatter structure is delivering the

anticipated efficiencies.

Training

Training investments continue to rise and reached

R18,4 million, up 51,3% on 2006. Workplace safety

remains the major focus area for our trainers. Increased

investment is necessary to guard against any increase

in accident rates in view of high capacity utilisation

and the pressure of constantly maintaining high

throughput. In some operations we have used

internationally respected safety consultants to help us

develop a world-class safety strategy.

Technical training and reinforcement of on-the-

job competence are areas of strength at Bidfreight.

Increasingly, we see the need to support training with

personal development to foster higher levels of talent

retention.


We continue to secure improvements at all business

units across all pillars of the group’s BEE scorecard. BEE

procurement in the year amounted to R547,5 million.

To prepare promising candidates for further promotion,

skills transfer has to be followed by a period of practical

experience in positions of growing responsibility. We

continue to focus on these measures as we need an

assured supply of experienced candidates for senior

positions if we are to meet our growth objectives.

Corporate social investment

The CSI commitment was R1,6 million. Focus areas

are health, education and community upliftment.

Community interaction includes long-term efforts to

ensure our businesses operate as good neighbours

by reducing waste and respecting all environmental

legislation.

Innovation

Cargo handling efficiency is a key area of innovation.

In business units focused on sea-freight, reduction

of ship-days on the quay is an area where we have

achieved significant successes.

Installation of SABT’s R45 million ship unloader

has brought phase two of the company’s terminal



modernisation programme to a successful conclusion.

The ship unloader can handle 800 tons of free-flowing

cargo an hour. Application of this technology will more

than halve the average berth occupancy per vessel at

the SABT terminal on Maydon Wharf.

Commissioning of the unloader is an example of

proactive innovation as the full benefit of its huge

capacity will only be felt when fully laden Panamax

vessels can be unloaded directly at Maydon Wharf. For

this to happen, the Port of Durban has to deepen the

Maydon Wharf berths.

Safcor Panalpina’s airfreight operations achieved

a succession of throughput records following the

completion of phase one of its expansion programme

at OR Tambo International Airport (Johannesburg).

Advanced security systems were built into the design

specification, improving efficiencies and driving

continued growth in market share in the area of high-

tech, high-value imports.

New investment

Approximately R100 million was invested in

refurbishing existing facilities and a further R130 million

was committed to new infrastructure. In several

instances further investment awaits the conclusion of

lease agreements or progress on infrastructure projects

by state agencies.

Phase two of Safcor Panalpina’s expansion programme

at ORTA is nearing completion and will add a further

10 000m2 to warehouse capacity. These new facilities

will go into operation early in the new financial year

and represent an investment of R78,6 million.

Challenges

The principal operational challenges relate to capacity

constraints and congestion. We will continue to

cooperate in all initiatives to expand facilities and

achieve improved efficiency at South Africa’s harbours

and airports.

Skills shortages are another concern as experience

has shown that constantly increased training budgets

provide only a partial solution. There is no substitute for

time on the job and practical experience.

HIV/Aids was identified some time ago as a major

challenge. We have made good progress in the

integration of HIV/Aids education and voluntary

counselling and testing into wide-ranging wellness

programmes, while antiretroviral treatment is provided

at many of our in-house clinics. These efforts have been

stepped up and two new clinics have opened.

The future

We anticipate a continuation of South Africa’s GDP

growth in the 5,0% range and believe the economic

climate will remain favourable. We see no sign of

abatement in the world demand for minerals from

South Africa and neighbouring countries, providing

a strong underpin to export activities. Economic

reform is under way in many African states, leading to

increased investment and growth in cross-border trade.

This is positive for our businesses inside Africa.

Indications are that grain volumes have recovered

strongly. The adverse agricultural cycle appears to

be behind us and further growth in volumes can be

expected in 2008.

Higher interest rates may put a brake on South African

consumer spending, affecting the level of imports

in some categories. Container traffic reached record

levels in 2007 and this rate of growth may moderate

somewhat, but no sudden reversal of the “container

flood” is foreseen. Automotive imports have shown

signs of slowing. However, government’s strategy of

infrastructure-led growth should ensure strong inflows

in many other categories, with Bidfreight businesses

well placed to benefit.

The import of petroleum products and export of

chemicals continues at high levels, creating higher

demand for liquid storage facilities. Add to this the


pace of South Africa’s economic growth and it is clear

that there are exciting opportunities for expansion.

Bidfreight’s capital expenditure growth is expected

to continue in 2008. The short-term focus will be on

efficiency gains and working smarter with the facilities

we have. Consequently, we expect an improvement in

the return on funds employed.

Through efficiency, full utilisation of our resources and

the development of smart solutions for our customers

– underpinned by continued economic growth – we

believe profits will continue to grow.

We are confident about national prospects in the mid

and long term. Expenditure on national infrastructure

will not be curtailed after the 2010 Soccer World Cup.

Government infrastructure planning looks out to 2014

at least while on-the-ground experience over the last

two years indicates that substantial and sustained

investment will be necessary to address capacity

constraints. These factors are all positive for trade and

for Bidfreight.

Bulk Connections

The strategy of increasing the range of non-coal

commodities is paying off at Bulk Connections, our

bulk mineral terminal in Durban. The result was another

year of strong growth. Manganese ore exports added

significantly to the volumes at the Durban terminal.

Further opportunities to widen the range of

commodities are being explored, with focus on

cement, fertiliser and ores. Improved margins will be

sought by examining the possibility of providing add-

on services such as bagging, screening, crushing and

container loading.

New investment is planned in Durban to increase

concrete storage facilities. Though negotiations with

the National Ports Authority are at an advanced stage,

lease conditions have yet to be finalised at the Durban

terminal.

Island View Storage

Demand at Island View Storage, South Africa’s foremost

independent liquid storage provider, remained high,

resulting in strong growth in both turnover and profit.

Demand is particularly strong from customers in the

petroleum industry, but capacity constraints in Durban

have limited our growth. There is an urgent need to

add capacity in Durban and we are pursuing additional

land to build more capacity. In the interim, the

principal challenge is to achieve continual efficiencies

and sweat the assets.

In Richards Bay, where we have land available, new

tanks were constructed for chemical exports and low

pressure gas imports.

Growth in revenue and trading profit is anticipated

from all operations in 2008.

Bidfreight continues to invest in improving

environmental and health and safety performance. It

is with great regret that we report that there was one

fatality aboard a vessel being stevedored. International

safety consultants Du Pont were brought in to support

further improvement in operational safety standards.

Bidfreight Port Operations

Bidfreight Port Operations, a specialist in providing

warehousing and quayside services, was affected by a

reduction in steel exports. This reduction was caused



by a redirection of steel to meet growth in domestic

consumption.

Management reacted by reducing costs and increasing

the stevedoring of bulk and containerised cargoes in

the Cape. This enabled us to maintain profitability.

The container stevedoring operation which we

perform for Transnet showed continued growth.

Management will focus on diversification from steel

and paper handling and the pursuit of opportunities

for growth in areas such as bulk container packing.

Safety on older vessels is becoming a concern and

external consultants have been used to reinforce safe

working practices.

Rennies Distribution Services

Rennies Distribution Services, the national supply chain

and logistics specialist, faced high levels of competitive

pressure, particularly in the metals, automotive and

paper divisions. Strong performances were evident in

the transport and chemical divisions. Opportunities for

further growth in these markets will be pursued.

Warehouses throughout South Africa remain the

strength of this business and optimising the utilisation

of these assets will result in profitability growth.

SACD Freight

SACD Freight, South Africa’s leading container depot

operator, continues to derive benefit from the global

growth in container traffic. Both turnover and trading

profit increased.

Secunda operations continue to grow while potential

operations in Coega hold the prospect of significant

future expansion. Growth in cross-border traffic into

Africa is another positive factor.

Bidfreight Intermodal continued to grow and made a

significant contribution to profit.

Sustained volume growth is putting pressure on the

capacity of current facilities. An expansion programme

is in place to address this challenge.

South African Bulk Terminals

South African Bulk Terminals, the country’s largest

bulk grain handler, was impacted by the total absence

of maize volumes until the last two months and low

wheat volumes. However, our competitive advantage

has been sharpened by consistent reductions in berth-

times following the deployment of new technology,

notably Africa’s fastest, largest and most efficient grain

ship unloader. Cost efficiencies were achieved.

Volumes picked up considerably toward year end and

higher volumes are anticipated. Six new silos were

constructed last year. Work has begun on another

six. Opportunities for expansion in Cape Town and

southern Africa are being investigated.

Naval

Our Mozambican stevedoring operations performed

above expectation for the second successive year.

Volumes were underpinned by higher ferro-chrome

and coal exports. Growth in import and export

activity is expected to continue at Maputo, Beira and

Nacala. As Mozambique’s national prospects improve,

competitive activity is expected to sharpen from other

port operators.

INTERNATIONAL CLEARING AND FORWARDING

Safcor Panalpina, the international freight management

specialist, achieved record throughput. Tender

successes augmented volumes, but compounded

margin-squeeze. The weakening of the rand increased

levels of disbursement and therefore our revenue.

Increasing interest rates also had a positive effect on

our earnings from cash holdings.

Expanded facilities at ORTA made a significant

contribution, though investment here has increased

costs. Working capital was adversely affected by a


change in credit terms for a major client and margins

came under pressure from competitive activity and the

rand’s weakening trend.

Phase two of the ORTA expansion programme, creating

an airfreight cross-dock and adding to warehouse

space, will become operational in August 2007. This

will further accelerate throughput, enable further

efficiency gains and entrench our marketplace position

as the southern African benchmark for high-tech, high-

value clearing and forwarding. Investment in IT systems

is continuous.

The staff complement has grown from 1 190 to

1 239 and further job growth is anticipated.

Sebenza, our associated company, performed

well and exceeded budgeted trading levels. The

operations continue to deliver excellent service to

the government, parastatals and certain blue-chip

customers.

MARINE SERVICES

South Africa’s market leader in ships agency services

performed very well, driven by growth in volumes

handled by liner principals and car-carrier activities.

Increased vehicle inspection fees, increased owner

supervisory appointments and earnings from the

Agulhas casualty in East London augmented revenue.

Efforts are under way to further increase our Africa

representation.

MANICA AFRICA

African operations performed well, with the exception

of Manica Malawi where remedial action has been

taken and a rapid return to profitability is anticipated.

Zimbabwe creates special challenges in view of

the onset of hyperinflation. However, the business

continues to turn in a satisfactory performance. The

Zambian and Namibian business units performed

particularly well while profit from Botswana operations

was above budget. For the second successive year,

Manica Africa’s result was pleasing and new investment

will be committed to help local management maintain

momentum.


Lindsay RalphsChief executive

Review of operations – Bidserv

Value proposition

Bidserv brings critical mass and professionalism to

previously fragmented services, giving customers the

assurance they are dealing with a reliable long-term

partner with the resources to deliver the requisite levels

of quality and support.

Macro factors

Sustained economic growth is good for our clients

and good for Bidserv. The credit squeeze facing some

South African consumers had little direct impact in our

corporate services environment. Business confidence

remains high.

The switch in strategic emphasis from consumer-led

growth to infrastructure-led growth is advantageous

as we often serve the companies that benefit from

increased fixed investment by government, the

parastatals and the private sector.

Some segments of high-growth South Africa are doing

particularly well, including tourism, property and petro-

chemicals. The knock-on effects were highly beneficial

as our business units serve the travel and airline

industries, provide a wide menu of services to new

office parks and factories and deliver specialist cleaning

expertise to the oil companies and power generation

industries.

The higher interest rate trend was mildly positive for

our travel-related financial services and trade finance

activities.

Industry dynamics

Despite continual investment in technology and

new systems, many of our companies operate in a

people-rich rather than a resource-rich environment.

We are proud of our record for sustained employment

creation, especially as many jobs involve a low level

of skills and are therefore accessible to South Africans

who have not had access to higher levels of education.

People-intensive operations, however, leave us

vulnerable to changes in the industrial relations climate

– a key feature of industry developments last year.

Off ers a full range of outsourced

services including cleaning, laundry,

hygiene, security, interior and exterior

landscaping, aviation services,

janitorial products, industrial

workwear, travel, banking and

foreign exchange services, offi ce

automation, supply chain integration,

e-procurement and online travel.

> Trading profi t up 19,0% to R669,4 million

> Revenue increased by 16,2% to R5,4 billion

> Return on funds employed above 53%

> Capex expenditure of R290,4 million

> Disposable income of employees above

infl ation

> 100% ownership of Master Currency


14,7%

Contribution to Group trading profit 2006: 15,3%

The greatest frustrations occur when industry-wide

strike action takes place. Indiscriminate industrial

action hurts the good employer along with the bad.

Our terms and conditions of employment are fully

compliant with all statutory requirements, but our

security and cleaning operations were hard hit by

prolonged national strike action.

Wage settlements were significantly higher than

inflation, putting great pressure on our margins.

The strikes were extremely debilitating. Our workers

lost pay. We lost both money and clients. In response

to margin pressure following the pay hikes, we

have had to seek efficiencies and synergies, in some

cases investing in technology and smart systems

to deliver long-term savings. In this environment,

it was remarkable that we still managed to create

7 000 new jobs.

A trend that remains positive for Bidserv is rigorous

control of service level agreements in the outsourced

services industry. This is a source of competitive

advantage for Bidserv as we set the industry standard

in terms of equipment, reporting and performance

management.

In-house developments

The effects of industry-wide strikes on people-intensive

operations gave added impetus to the long-term

strategy of differentiating Bidserv on the basis of higher

quality and smarter solutions.

The challenge is best crystallised in the security

sector where three basic offerings are evident – the

people-reliant guarding service, the high-technology

security solution driven by investment in sophisticated

resources and, thirdly, the integrated service offering

combining high-tech elements with people resources

(which may require additional training investment to

ensure an individual’s competence in a resource-rich

environment).



Bidserv has decided to step up efforts to further

expand its footprint in the last two areas. We see only

limited opportunities to add value when the core

offering is a service that relies solely on guards with

little technology support.


High growth translates into higher demand for skills,

particularly in areas such as IT infrastructure; the focus

of much of our investment.

The growth challenge that is perhaps most evident –

rapidly increasing demands on transport infrastructure,

including airports – is a net positive for Bidserv. More

airlines are travelling more frequently to South Africa,

more tourists are flying in and domestic business travel

is a substantial growth area.

South Africa’s 10 airports handle more than

200 000 aircraft landings per year. Plans are under way

to improve runway capacity at OR Tambo International

Airport (Johannesburg) and Cape Town international

airport. This will increase the traffic flow from 56 to 76

aircraft per hour. Aircraft capacity at ORTA is also being

increased to accommodate new wide-body, long-haul

aircraft such as the A380.

The number of airlines operating in South African

airspace has grown from nine in 1994 to more than

50 today. The tempo may pick up even further on the

run-in to the 2010 Soccer World Cup.

These developments are helping to grow our Aviation

Services companies and travel businesses.

Power outages caused by the strain on national

generating capacity have necessitated an increased

investment in secondary power supplies at some

business units. For example, laundry operations for

hospitals and hotels can be extremely time-sensitive.

The investment adds to our costs, but increases our

competitive advantage versus smaller operators who

cannot ensure this level of service reliability.

New structures

There were no major acquisitions, though TMS Group

Industrial Services bought a small, Johannesburg-based

industrial services company.

Hotel Amenities Suppliers, previously housed within

Bidfood, was moved into the Bidserv fold, enabling

us to create a new specialised operation to serve

the growing hospitality sector – hotel amenities and

accessories.

Premier Club Airport Lounges was integrated into a

new unit – Premier Airport Services – and moved into

the Aviation Services segment of the business. It was

previously part of Bidtravel Services.

There were no disposals.

Risks

Business risks are little changed. The basic nature of

many of our services ensures stable or increasing

demand across various business cycles.

HIV/Aids is a key risk area. Over the years, we have

taken Aids awareness and education to many

thousands of workers, distributed condoms and

provided confidential counselling and assistance.

New initiatives may be necessary to improve the

effectiveness of this work.

In the past, we have called for combined service

industry initiatives as a means of unlocking economies

of scale. There has been little response, but we

continue to canvass support for wider initiatives.

Legislative risk and sensitivity to changes in labour law

are ever present. Bidserv minimises the risk by being

proactive, often raising internal standards ahead of any

legislative requirement.

Numerous small, under-resourced and poorly

capitalised companies are active in many service

industries. Their observance of legislation and good


corporate governance practices can be haphazard.

Bidserv, in contrast, is known for scrupulous legal

compliance.

Exposure to any worsening of the industrial relations

climate has already been noted.

Low barriers to entry in some service sectors no longer

carry significant risk as Bidserv has limited “bottom-

end’’ exposure.


Sensitivity to economic variables is judged to be

moderately positive. South Africa’s growing commercial

base is good for Bidserv business. The effect is to

stimulate recurring income for our services.

Rand weakness has little discernible effect and may be

a mild “stimulant” as it encourages inbound tourism.

Our travel businesses focus on the business traveller

rather than the rate-sensitive private consumer. A small

uptick in inflation has little impact.

Rising fixed investment is a substantial positive.

Higher trends in wage settlements are a sensitive

area. Higher wage scales are a major contributor to

service industry inflation, which Bidserv puts at about

7,0% – 8,0%. Client resistance stiffens when annual

price increases move above 5,0%, accentuating margin

pressure. Bidserv has blue-chip clients, who, as major

corporates, aggressively manage their supply-chain

costs.

Proudly Bidvest

Membership of the Group is showcased by investment

in corporate image elements, including vehicle liveries.

Our role as a key contributor to a major JSE-listed

group is a source of reassurance for our corporate

customers.

In addition, Bidvest’s status as one of the most

empowered companies in the country is important to

our clients as most of them put increasing emphasis

on BEE procurement. For example, the strong

empowerment profile at group level has assisted us in

significant new business gains in the public sector.

Differentiation

Stature, resources and professionalism are crucial in an

often-fragmented service sector. Bidserv’s positioning

as a reliable partner is the core element in our value

proposition. We offer predictable performance within

rigorously managed quality and price parameters by

professionals who are here for the long haul. Under-

resourced, often opportunistic industry players have

trouble competing with this promise.

Training

Training investment increased by 36,5% to

R36,0 million.

Initiatives are being examined to complement

internal training with training efforts directed at joint

ventures or operations we are partnering as part of our

commitment to enterprise development.


Most individual business units have obtained

empowerment ratings or are in the process of doing

so. Improvements have been achieved across most

elements of the Bidvest BEE scorecard.



Though steady progress is evident in all areas, three

specific pillars of empowerment have been targeted

for focused attention: training, promotion of black

staff into areas of real responsibility and enterprise

development.

Many businesses have taken as their model The Bidvest

Academy and have set up their own mini-academies.

They identify high potential individuals and give them

a concentrated course of training in leadership and

people management.

“Graduates” are channelled into mentorship

programmes. The academies enable staff to progress

into senior positions while hands-on mentorship helps

retain individuals who have acquired highly marketable

skills. The attrition rate of staff with high potential

has affected our BEE scores in middle and upper

management categories. It is hoped the new initiatives

will halt or slow the migration of these staff members.

In the area of enterprise development, we have begun

the process of identifying people-intensive operations

that are currently housed within Bidserv but could go

it alone, given the right type of support. The finalised

codes of good practice give continuing credit for this

type of intervention, even when the enterprise under

development is “set free”.

Some cleaning, laundry and security operations could

be developed into independent businesses.

Simultaneously, we have begun discussions with

service providers that are already independent but

require training support and a recurring income

stream. For example, one women’s group that provides

technical services can be assisted by refocusing

their business on equipment servicing (point-of-

sale machines, CCTV cameras and cash-counting

machines). This assistance will add another credible

BEE supplier to our list and improve our enterprise-

development credentials.

Win-win scenarios like this have become a focus area

for empowerment efforts.


Our social investment spend focuses on support for

communities from which we draw our staff with the

accent on education. Efforts are decentralised, but

synergies occur. Several Bidserv units have sponsored

the lap-desk concept as a way of assisting under-

resourced schools.

This belly-hugging board rests on a pupil’s knees and

provides support for books. Each lap-desk is branded in

the colours of the Bidserv sponsor, though most of the

desk space is taken up with educational aids, including

shapes, colours, multiplication tables, maps or the

layout of an alpha-numeric keypad.

In one major initiative led by TMS Group Industrial

Services we spent approximately R1 million building

additional classrooms at under-resourced schools.

CSI rose 65,0% to R9,1 million.

Innovation

Bidserv has become a proactive solution-provider

across all areas of activity.

In office automation, the introduction of the Bizhub by

Konica Minolta South Africa has redefined the market

for business solutions by combining into one unit the

laser printer, colour copier and e-mail platform.

The purchase of TSI by TMS Group Industrial Services

has enabled us to integrate lagging, scaffolding and

other specialised cleaning items into the biggest

product line-up ever to be made available in this

market at a time when many large industrial groups are

consolidating their purchasing.

Bidtravel Services has entrenched its leadership in

the corporate travel business by rolling out its “travel

engine” across all operations, creating a virtual travel


agent that can be called up at a keystroke. The system

has bedded in and enjoys growing market acceptance.

TopTurf’s golf course design and construction unit

is setting the pace in a highly specialised field. It has

completed an Ernie Els-designed course in Mauritius

and is busy on an Annika Sörenstam signature course

at Naboomspruit.

New investment

Capital expenditure of R290,4 million included

R138,8 million on expanded facilities with substantial

allocations for plant and equipment and additions

to the vehicle fleet. R151,6 million was spent on

infrastructure replacement and upgrades.

The future

The Airports Company South Africa has awarded a

ground handling licence to Aviation Services. The

licence does not become operative until March 2008.

However, we are well positioned to optimise this

strategic opportunity. For some time, we have invested

in support of baggage handling, ramp handling

and passenger and cargo handling facilities while

our teams have developed the necessary skills and

experience in all these areas. We view airport handling

services as an area of promising growth and hope to

create new jobs in these activities once the licences

come into operation.

Bidserv is confident of continued growth in revenue,

profit and jobs. We project 10% real growth off a high

base. The national economy continues to achieve

strong growth and high levels of fixed investment are

anticipated.

These factors underpin the strong demand for our

services. Our strategy of taking a bigger basket of

value-adding services to our corporate customer-base

has proved highly successful and further gains are

anticipated.

Master Currency joins Bidserv with full effect from

July 1 2007 and will reinforce our offering in an area of

strong growth – foreign exchange and travel-related

finance.

Bidserv’s training spend and investment in facilities will

increase as value-add becomes increasingly important.

In addition, we will review the quality of our business

mix and may sell some low-margin contracts.

We also project job growth in the 7,0% – 8,0% range.

Prestige Group

The market for cleaning services remained buoyant

and gains in market share were recorded. Further

opportunities for growth are being examined in

specialist areas such as food hygiene. Prestige Group’s

ISO 9001 accreditation emphasises its qualitative edge

and will be an important plus-point when establishing

new niche operations.

TMS Group Industrial Services

Investment in infrastructure and consolidation

continue to pay off. The TMS Group more than doubled

its revenue. Major industrial companies and petro-

chemical operations look for strong partners capable of

meeting their quality requirements. TMS fits the bill and

has successfully positioned itself as the sector leader.

Laundry Services

Laundry Services has gone through a year of

consolidation while achieving pleasing levels of

profitability. A major contract was lost when a



healthcare group created an in-house laundry facility.

We continue to invest in more productive equipment

and anticipate further growth as room occupancy

levels are moving higher in the hospitality sector and

pressure on hospital beds remains high.

Steiner Group

Pleasing levels of growth were achieved and are

expected to continue. Rochester Midlands Industries

was moved into the group as our customer-base

provides a growth opportunity for a company with

complementary services. The inclusion of Execuflora

within the Steiner Group has proved highly successful.

The group has widened its footprint by opening

operations in Mozambique and Botswana.

Bidserv Industrial Products

Strong momentum has been built up, underpinned

by national market acceptance of the full range of

G. Fox products. The operation has grown its business

by 50% in two years, necessitating a move to much

larger premises. Bidserv Industrial Products continues

to innovate and has created the industry’s first cash-

and-carry operation, a one-stop shop for safety boots,

goggles, overalls and chemicals. Malawi-based Giant

Clothing put in another strong performance.

Green Services

Top Turf had a record year, drawing maximum

advantage from strategic expansion into golf course

design and development. South Africa’s commercial

growth adds to the momentum; specifically the

landscaping needs associated with resort expansion,

property development and the creation of office parks

and golf estates.

Aviation Services

Premier Club Airport Lounges (previously in the travel

division) has been rebranded as Premier Airport

Services and integrated into the Aviation Services

operation to further widen the service offering.

The division has enjoyed substantial growth and is

positioned as a strong player in the growing market for

airport services.

Bidrisk Solutions

Magnum was severely affected by strikes and

results were extremely disappointing. The rate of

job growth has slowed and the long-term future of

some operations being re-evaluated. Vericon, with its

audit security offerings, did well and is well placed for

further growth. Provicom Electronics put in another

satisfactory performance. The joint-operations control

room, a greenfields initiative, has yet to get fully into its

stride but shows potential.

Global Payment Technologies

The business has formed strong relationships in the

financial services sector and continues to innovate

across its product range. The latest addition to the line-

up is the “Deposit Manager”, a machine that accepts

cash deposits and checks and validates notes. The

business continues to secure acceptable growth.

Business Solutions

Electronic procurement services through

mymarket.com enjoy growing acceptance and the

travel engine is at the cutting edge of our penetration

into an area of exciting growth – factors that helped

to take the business beyond the break-even point and

into acceptable profit. The business is positioned to

maintain momentum and profit.

Group Procurement

Multi-million rand savings were achieved by

Bidprocure following the signing of major contracts

for telecommunications services. Opportunities for

further efficiencies are being pursued with mobile

communication and business network service

providers.

Office Automation

The office automation business enjoyed a good year,

securing strong growth, including the award of a major


government tender. This is an indication of strong

BEE credentials as well as confirmation that the team

supports a strong product line-up with extremely

high service levels. Konica Minolta SA entrenched

its position as market leader. The performance of

Océ was affected by cyclical factors, but significant

improvement is anticipated.

Bidtravel Services

The travel businesses put in an outstanding

performance and drew significant benefit from the

growth in airline business, higher levels of corporate

car rental and high occupancy levels in the hospitality

sector. World Travel and Travel Connections put

in a particularly notable performance. The travel

engine has proved to be an exceptionally strong

tool. Its speed, convenience and ability to generate

pertinent management information have entrenched

client relationships. Management has been further

strengthened and continued growth is anticipated.

Banking Services

The businesses put in an extremely strong

performance, aided by the interest rate climate, strong

demand for travel-related finance in the corporate

sector and a strengthened management team. The

demand for card services is also strong.

Foreign exchange services have had another good

year. Further gains in market share are anticipated with

the integration of Master Currency into the operation.

Its outlets occupy prime positions at major airports and

metropolitan centres.

Hotel Amenities Suppliers

The business provides a quality brand offering to the

hospitality sector and achieved a pleasing level of

growth. New business gains included the Protea Hotels

account.


Bernard BersonChief executive

Review of operations – Bidvest Asia Pacifi c

Value propositionBidvest Asia Pacific offers the most comprehensive range and widest coverage of its core markets, delivering economies of scale and one-stop solutions while giving customers the assurance of professionalism and reliability in an otherwise fragmented industry.

IntroductionThe Angliss acquisition was effective from May and therefore the contribution to overall performance was limited to the last two months of the year. Though the contribution to date is limited, exciting opportunities are evident across the Angliss operations in Singapore, Hong Kong and mainland China.

Local management remains in place and will be strongly supported as we begin the task of improving the returns from these dynamic, but highly competitive markets.

The markets in which Angliss is active have many unique characteristics. This is also true of our Australian and New Zealand operations as macro factors at the two ends of the Tasman Sea are often dissimilar. The challenge is to exploit unique opportunities by respecting the special nature of each operation.

The decentralised Bidvest model is a proven performer in these circumstances as local managers are encouraged to optimise local knowledge while leveraging Group resources to achieve competitive advantage – a process that is well under way in both Australia and New Zealand. We see great scope for the Bidvest approach in the markets served by Angliss.

In our Australian and New Zealand businesses the principal challenge was to achieve continued growth following previous strong performances. Both operations rose to the challenge and achieved highly satisfactory results, thanks to stable local management backed by well-motivated teams. The Australian contribution was especially pleasing.

BIDVEST AUSTRALIATrading profit rose 33,2% to A$44,6 million off revenue growth of 9,0%. All business segments performed well, and our return on funds employed was an all-time high of over 50%.

> Trading profi t for the expanded business rose

58,0% to R346,6 million

> Revenue up 36,2% to R8,9 billion

> Acquisitions in Australia and New Zealand

strengthened leadership

> Acquisition of Angliss Singapore and Angliss

Hong Kong and China provide foothold in one

of the world’s fastest growing markets

Comprises Bidvest Australia, Bidvest

New Zealand, Angliss Singapore

and Angliss Hong Kong and China.

Bidvest leads the foodservice industry

and off ers a full end-to-end national

distribution service.


7,6%


Macro factorsAustralia’s economic fundamentals are generally favourable, with GDP growing by 3,0% a year and inflation controlled within the 2,5% to 3,0% band. The economy continues to benefit from the resources boom. This supports a high level of both business and consumer confidence. Interest rates have been relatively stable at around the 6,25% level for the year, though they were recently increased by 0,25%.

The Australian dollar remains strong but volatile. However, this has had no significant effect on tourist arrivals. The tourism and leisure sectors continue to do well.

Industry factorsThe national feel-good factor underpins the trend toward increased out-of-home eating by the average family. This is good for restaurants and good for Bidvest Australia.

In full-employment Australia another key development is for employers to enhance the working environment. One aspect of this effort to improve an employee’s on-the-job experience is to provide more staff amenities and eating alternatives at the office – a positive trend for our business.

Business driversThe principal factor driving our own growth is the continuing success of the three-legged divisional structure put in place over a year ago. We have a core foodservice operation supported by a focused QSR business (serving the industry’s quick service restaurant segment) while a specialist hospitality industry supplies business. Our managers understand their focus areas and add value by anticipating customer demands.

The stability of seasoned management teams working within a logical, uncluttered structure has contributed to growth across the board. Geographical expansion by the three divisions is ongoing, but strong organic growth within the existing customer-base continues to be a key feature of our performance.

New structuresA series of acquisitions has strengthened the foodservice and hospitality businesses.



Hospitality supply businesses have been purchased in Geelong (Victoria), Perth (Western Australia), Sydney and Melbourne. The Sydney acquisition is effective from July 2007. The Melbourne business has been amalgamated with our existing operation in the port city.

In May we bought a foodservice wholesaler in Ipswich in south-eastern Queensland and (effective from July 2007) purchased wholesale business operations in Tamworth and Armidale, New South Wales.

Earlier in the year, the foodservice operation was strengthened by the acquisition of two small businesses (one in Melbourne, one in Sydney) that specialise in supplying businesses with tea, coffee and refreshments for their employees. Activities on this pattern are highly fragmented at the moment, but offer us a growth and cross-selling opportunity.

These acquisitions give us a chance to study this niche and develop an appropriate strategy for possible roll-out in commercial centres across the country.

There were no acquisitions by the QSR division. However, this business continues to secure strong organic growth and is a major beneficiary of our infrastructure growth strategy.

New investmentsOur Perth warehouse has been expanded while capacity at our operations in Townsville, Northern Queensland, has been augmented following the purchase of a large frozen storage facility. In addition, we are expanding warehouses or building new facilities at Cairns, Mackay and Sunshine Coast (all in Queensland) and at Wollongong, New South Wales.

Infrastructure investment is designed to cater for both current growth and anticipated expansion in the medium term.

RisksBusiness risks are little changed. However, one risk area has come into greater focus – political change. This is an election year. After 11 years in opposition, the Labour Party is about to launch a strong challenge. Should there be a change of government there is a risk that new policy initiatives will affect the national mood and perhaps put a brake on growth. Caution rather

than confidence might then set in; for business as well as the consumer.

This could affect foodservice demand in some categories. The only mitigation strategy in the face of this type of risk is to provide a comprehensive range of products that responds to all needs and tastes.

Sensitivity analysisIn common with all foodservice businesses, the economic variable to which we are most exposed is the consumer’s level of disposable income. A family’s propensity to spend on items other than basic foods has a major influence on our volumes, the development of our ranges and the growth of our businesses in general.

Australia’s level of unemployment is at a record low (4,0%). In effect, this is a full-employment economy. Wages are therefore high and the current level of inflation and interest rates puts little pressure on disposable income. This may be an area of sensitivity, but the analysis is favourable and will remain so for the foreseeable future.

Proudly BidvestThe strength of the Bidvest connection was demonstrated by the Angliss acquisition. Access to group resources puts us in a position to pursue strategic opportunities. We not only mount expansion strategies, but sustain them in the long term. The backing of Bidvest resources is obviously crucial to us.

Our business units all carry the Bidvest name and livery.

DifferentiationWe are the only truly national player in a highly fragmented industry. Our localised competitors lack our resources and infrastructure. We can secure national accounts and assure our customers of uniformly high standards of service across Australia. Ongoing investment in infrastructure reinforces this unique positioning.

InnovationOur continuing investment in IT systems keeps us at the forefront of electronic marketing and customer service. The incidence of electronic sales mounts by the month and now approaches 30,0% of all transactional volume.


Thanks to our investment in systems, our teams have become proactive interpreters of sales patterns from specific customers and regions. By making use of a constantly refreshed database, we up-sell, cross-sell and anticipate customer needs on a scale without precedent in our sector.

Our quality management system and HACCP and ISO compliance programmes lead the industry.

Social commitmentsWe have been nominated for a Prime Minister’s Award for our job creation efforts on behalf of people with disability. Unlike South Africa, our labour legislation does not set employment equity targets for people with disability. However, we have made it a policy to do what we can to offer productive work to disabled people whenever possible. Several of our businesses have employed people who are considered intellectually challenged or have various levels of physical disability. Results are so positive we are encouraging other employers to follow our example. Nomination for a Prime Minister’s Award means our efforts have been noted at national level.

TrainingTraining investment continues within our business. We differentiate ourselves not only in terms of our comprehensive range and geographic reach, but the quality of our service. Increasing emphasis is therefore being given to sales training and customer service.

ChallengesIn a full-employment economy, individual productivity is the key challenge. We have to equip our people with the tools and skills to perform to the optimum. We also have to create working environments that foster superior output. We can grow our systems and infrastructure, but we can’t grow the payroll to the same extent when job applicants are in short supply.

A further challenge is to deliver growth on top of growth in the face of manpower constraints. Our management teams have proved themselves capable of meeting this challenge and we are confident further significant gains can be made.

The futureWe will pursue double-digit gains in both revenue and trading profit. We are investing in more and better trained sales people. Smart systems have to be

complemented by smart people who are capable of managing the face-to-face interaction with a growing customer-base.

Better understanding of customer needs is fostered by infrastructure development. In the past, many QSR customers were serviced through general foodservice distribution centres. Continual expansion of QSR warehousing enables this category of customer to receive dedicated service from QSR teams, pushing up customer satisfaction levels.

We estimate that we currently hold 20% of the national foodservice market. Substantial growth is possible through range extension, expansion of the customer-base and geographic expansion. Further acquisition opportunities will be explored. Simultaneously, we will investigate growth possibilities in niche activities in new markets, such as the office amenities and refreshment market.

BIDVEST NEW ZEALANDTrading profit in local currency grew by 23,3% while revenue increased by 19,3%, a result of both acquisition and organic growth. This represents a highly satisfactory performance in a challenging market.

Macro factorsLow GDP growth of less than 2,0%, the highest interest rates in the developed world (8,0%) and an extremely strong currency are the principal features of the domestic economy. Labour costs remain high and labour shortages continue as the unemployment rate runs at close to 3,0% (a record low).



Inflation is controlled at about 2,5% and consumers have benefited from competitively priced imports, courtesy of the strong New Zealand dollar. Import activity, however, has hit some local industries hard. The country remains a major exporter of agricultural products and the farming sector has looked to capitalise on high world prices for dairy products. The strong local currency diluted some of these gains, however.

Interest rates were driven higher by the authorities in a failed attempt to cool the overheated housing market. The net effect has been to dent business confidence and keep economic growth in check.

Industry factorsThe strong currency has also inhibited the growth of tourism, with knock-on effects among one of our major customers – the hospitality industry. In addition, we are affected by high wage costs and the rising fuel bill. New Zealand’s petrol and diesel prices are totally unregulated. Any adjustment in world prices is immediately felt by distribution businesses. The effects were mildly positive in the first half of the year when the oil price dropped, but in the second half the pressure was constant.

Business driversWe benefited from the full-year effect of the new structure. Crean, our core foodservice business, is now complemented by a fast-growing fresh produce division supported by a focused logistics operation.

Several acquisitions have extended our national footprint while contributing to growth.

Staff continuity and stability have become critical factors in management planning. We retained all key staff during the year. The contribution of dedicated, experienced and enthusiastic managers enabled us to maintain focus while pursuing a vigorous growth strategy. Challenges to the further growth of our business are similar to those faced by our Australian counterparts.

Investment and acquisitionsFresh produce businesses have been acquired in Hamilton and Wellington on the North Island and Christchurch on the South Island. They join the existing

network to form a group of eight fresh wholesaling businesses throughout New Zealand.

The latest acquisitions move the fresh business to the next level – the development of a truly national player in the fresh produce sector. The concept is unprecedented in New Zealand where local operations predominate.

Complementary, nationally based foodservice and fresh businesses create opportunities to offer customers one-stop solutions and achieve continued growth.

The creation of the Bidvest Logistics division – announced last year – proceeded as planned and its new Auckland distribution centre was completed in October 2006.

The concept of logistics support from a focused operation rapidly proved itself and has led to the further planning of logistics distribution centres in other key areas of the country.

Work is nearing completion on a new distribution centre in Wellington at an investment of NZ$6,5 million. It should be fully operational by August. In addition, construction has begun on another centre at Palmerston North (an investment of approximately NZ$5 million). Work will be completed by the beginning of 2008.

DifferentiationRecent investment has underlined our value proposition as the only national player capable of meeting the customers’ quality requirements in a consistent and professional manner. Our range is unmatched. We set the industry benchmark for quality service.

We can also optimise management resources. All systems, codes and procedures are uniform in all operations and branches; enabling high productivity and minimal disruption when internal promotion and transfer takes place.

Our IT investment allows us to better manage customer relationships and supply complementary product ranges with a single delivery. Through


innovation in e-commerce, over 20% of our business is now transacted electronically. Customers and suppliers are finding it easier and more efficient to deal with Bidvest than other foodservice wholesalers. Sophisticated systems not only enable optimum control of our own inventory, but provide insights into the stock levels and demand patterns at our customers’ premises.

RisksBusiness risks mirror those faced by our sister-company in Australia. In highly regulated developed markets, sensitivity to change in the policy environment is ever-present.

For example, new labour laws will soon drive up labour costs still further. Mandatory paid leave will increase while all employers will have to contribute to a superannuated pension fund for the benefit of their employees.

The impact of such legislation is felt across all industries. We mitigate the risk of new industry-specific regulations in areas like food hygiene and safety by applying world best practice.

The futureRecent acquisitions and continued infrastructure investment provide a platform for further growth. The general economic environment is expected to remain challenging. Even so, we will pursue continued growth in revenue and trading profit through increased market share and product range development.

Specifically, we intend to pursue incremental growth at Crean while looking for strong penetration of the fresh produce market. Our fresh division is still at the developmental stage, but we believe this market offers huge potential for a company with our resources and infrastructure.

Opportunities for range extension will also be pursued. Further acquisitions may be explored.

ANGLISSAngliss is one of Asia’s leading foodservice wholesalers and distributors with annual sales of more than R2,0 billion and facilities in Singapore, Hong Kong and Guangzhou in the People’s Republic of China. It also operates distribution centres in Beijing, Shanghai and Shenzen.

Angliss manages the supply chain of high-volume, temperature-controlled foods, including frozen and chilled meat and poultry, frozen seafood and vegetables and dairy and pastry products. It is one of Singapore’s top two importers of frozen and chilled protein and the number one service provider to the Hong Kong foodservice industry.

Angliss has a qualitative competitive advantage in its core markets following sustained investment in world-class cold storage facilities. It services customers with its own fleet of vehicles and offers tailored solutions to more than 5 000 customers in the foodservice, retail wholesale, airline kitchen, catering, hospitality and ships chandler sectors.

It makes use of a sourcing network of 650 suppliers in more than 30 countries.

One of the initial points of focus for local management will be more active integration of the Singapore and Hong Kong businesses to promote greater purchasing synergies. Possibilities for range extension are also being investigated with the aim of leveraging the strength of Angliss’s blue-chip customer-base by supplying a broader spectrum of their needs.

The Angliss businesses have performed above our expectations, and we expect this to continue.


Fred BarnesChief executive

Comprises leading foodservice product

distributors in the United Kingdom,

Belgium, the Netherlands and the

United Arab Emirates, providing

products, quality ingredients, fi nished

products and equipment to the

catering industry.

Review of operations – Bidvest Europe

Value proposition

Bidvest Europe is a well resourced, quality driven

broadline foodservice innovator whose products and

services add value by enhancing the competitive

position of its customers in the world’s most health-

conscious and rigorously regulated jurisdictions.

Macro factors

British inflation has become a concern and the Bank

of England has begun to increase interest rates. The

base-rate was 5,5% by the end of the period and in

July rose to 5,8%.

GDP growth in Britain is 3,0%, but there are indications

the consumer is being squeezed by higher housing

costs and much bigger fuel and utility bills (which rose

by nearly 30,0%). The prices of the food manufacturers

are also under increasing pressure, with the cost of

vegetable and food imports rising by more than

6,0%. Category inflation for food and non-alcoholic

beverages is running between 4,0% and 5,0%. Food

deflation has been replaced by food inflation.

The Dutch economy has the reputation of being the first

into recession and one of the longest to recover. This

proved to be the case when the guilder was replaced

by the euro. However, the recession is now over, and the

slow recovery gathered pace in 2006/7. Business and

consumer confidence have improved as a result.

Belgium’s economy performed well in 2006 with

3,0% growth, but the gains moderated in 2007.

However, wage settlements in the 5,0% range have

kept consumer confidence levels relatively high.

Stronger performance by Germany, engine of the

EU economy, is also positive for “the neighbours” in

Belgium and the Netherlands.

Industry factors

Hotel room occupancy levels remain high thanks to

strong tourism industries in all national markets.

A ban on smoking in Scottish and Welsh pubs,

restaurants and places where meals are served

> Trading profi t improved 16,3% to

R757,6 million


> Deli XL Netherlands impressive 40% leap in

profi ts

> Successful United Kingdom tender to supply

HM Prison Service

> Successful launch of Whites premium brand

in United Kingdom with introduction into

Belgium in October 2007

> Strong Flanders base established with

acquisition of Kruidenier foodservice business


16,7%


has further increased public awareness of hygiene,

food safety and nutrition. The ban has since been

extended to England. Assisting out-of-home eating

establishments to build repeat business has become

a focus area as these businesses adjust to the no-

smoking challenge.

A smoking ban will be implemented in the

Netherlands in July 2008.

Concern for the nutritional health of British children

has led to the establishment of the School Funds Trust

and widespread review of the standard of food served

in schools. In 2007 new standards were enforced in

primary schools. Further legislation is imminent. We are

well placed to respond to stricter standards and achieve

competitive advantage in view of our work to promote

healthy eating via our “positive steps” campaign.

Sustainability has become a critical factor for public

sector procurement initiatives.

High labour costs, healthy eating trends and

sustainability scrutiny also affect industry dynamics in

the Netherlands and Belgium.

The net effect for broadline food distributors is to

underline the need to become a partner of the

customer by anticipating legislative demands,

providing superior quality and nutrition ahead of time

and developing solutions that protect margins, create

new menu options or foster kitchen efficiency. Business

units in all national markets have responded well to

this challenge.

Business growth

Remedial action in the United Kingdom following

the loss of the Ministry of Defence contract entailed

the vigorous pursuit of new business while fostering

organic growth. Notable successes were achieved.

In the United Kingdom, we have won an additional

contract to supply the Compass Group, one of the



leading international catering operations. The new

contract involves non-food items and complements

our existing wholesale contract to supply Compass

with ambient food products. We also landed the

contract to supply the Hilton Hotel chain in the

United Kingdom across the grocery, frozen and fresh

ranges – an account gain that entrenches our position

as a leading broadline supplier to the hospitality sector.

Winning a £16 million contract to supply fresh

produce and groceries to HM Prison Service has major

significance. Scrutiny of food quality and nutrition is

intense when tenders are received by government

agencies. Our success in satisfying the most rigorous

investigation of our quality standards was a signal to

our industry that our quality controls are unsurpassed.

Public sector contracts are not awarded without a

simultaneous examination of a company’s record for

hygiene, workplace safety, investment in systems and

compliance procedures, environmental sensitivity

and commitment to the workforce and the wider

community. The tick in the box marked “Sustainability

factors” constitutes a de facto endorsement of company

culture and organisational health.

In addition, we have grown our business with the

United Kingdom operations of Aramark, the US

foodservices and facilities management leader. We

now supply Aramark with frozen, ambient and chilled

foods, a broad offering that enables significant logistic

efficiencies. Our business in the Netherlands has grown

its business with Sodexho, ISS and Compass while

Belgian operations strengthened their relationship

with Compass through increased sales of our Ultrafresh

range.

A key driver of organic growth – in the

United Kingdom and mainland Europe – is the trend

for customers to consolidate their procurement. These

developments were anticipated two years ago when

efforts were stepped up to create a consolidated

ambient, chilled and frozen offering backed by wine

and beverages and non-food supplies.

This trend has been accelerated in the United Kingdom

(and to a certain extent in the Netherlands and

Belgium) by climate-change concerns and renewed

efforts to reduce “food-miles” and the distribution

sector’s carbon footprint. The preferred solution is

range consolidation on a single truck from a single

source – a proposition our marketeers have advocated

for several years in view of our extensive service

offering.

To secure a bigger basket of our customer’s business

we also add value through administrative efficiencies,

advice on various ranges and our ability to provide

solutions that satisfy key needs (for example, the

provision of high quality, easy-to-prepare menu items

when skill levels vary in the customer’s kitchen).

Innovation

A new premium brand, Whites, has been successfully

launched. Fourteen menu items were introduced in

October followed by a further 16 in April. The range

was further extended in July. The aspirational brand

has been exceptionally well received after achieving

a 75% liking score in pre-launch research. 3663 First

for Foodservice is known for good value rather than

premium positioning. Whites has therefore created a

promising bridgehead into an important growth area

– the best product category.

An industry lead has been given by the integration

into our ranges of fresh produce and premium deli

items from Swithenbank and quality portion-controlled

meats from The Barton Meat Company. The breadth of

this service offering puts us at the cutting edge of the

range consolidation trend.

In 2007, we researched market demand for the

introduction of fresh and frozen fish. We sourced and

secured quality supplies of 500 new lines ahead of

the range extension, which became effective in July.

We demonstrated our sensitivity to environmental

concerns by incorporating some Marine Stewardship

Council products in the development of this new


offering. The council’s mission is to ensure global

sustainability of fish stocks.

In the Netherlands, our own brand coffee, Reuser &

Smulders was launched as an authentic, pure, high

quality, best taste brand. The brand concept includes

coffee, tea, cups, cookies, sugar, milk, machines and

Barista training to build a wider appreciation of the

total coffee concept.

New structures

The position of Deli XL Belgium as the country’s

leading foodservice company was further

strengthened by the acquisition of Kruidenier, the

number three player in the local industry. Deli XL

Belgium has a strong presence in the Walloon areas in

the south of the country while Kruidenier has its home

base in Flanders. Consolidation of the number one

and number three market players was well timed as

it came as another company in the industry’s top five

was wound up, creating the potential for future gains

in market share.

The focus in the Netherlands has remained on

further organic growth from its revitalised structure,

particularly in the non-institutional catering market.

There were no acquisitions by the British business.

The accent was on expansion of key operations such

as the London base of the fresh produce business

while making continual improvements to operational

infrastructure.

New investment

In the United Kingdom, the Basingstoke operation

(previously a depot dedicated to supplying the

Ministry of Defence contract) was converted into a

multi-temperature site. Another dedicated MoD site at

Dundonald has been taken over by the Ministry’s new

supplier. These arrangements ensured job losses were

minimised following the loss of this contract.

The catering equipment facility in Bristol is being

modernised and expanded. In October, we opened a

new Edinburgh depot while our Manchester site has

been expanded.

Investment in training is continual and rose to

R17,2 million.

Business risks

Legislative risk is well controlled as these processes are

predictable and well understood, though the extension

of the smoking ban across Scotland, Wales and

England was a reminder that business has to be flexible

and responsive to changes in the policy landscape.

Sustainability has become a risk area in view of the

priority given to these issues within the institutional

market. This risk has been addressed by making

this a focus area for management. Our record of

sustained investment in quality systems, training and

commitment to the environment cushions the risk of

tender failure through sustainability shortcomings, but

proactive management of all areas is essential.

Credit risk is a given in any trading environment, but

the magnitude of the exposure can be affected by

new corporate trends such as aggressive use of debt in

leveraged buy-outs. “Value” that appears to be locked



within a company can be stripped out at a rapid rate,

suddenly changing the risk profile of a customer.

Bad debt levels have risen sharply as a result of some

business failures, but vigorous corrective action has

been taken. Greater use is being made of insurance

tools to guard against the catastrophic failure of any

single customer’s business.

Customer expectations have also emerged as a risk

area following the change from food deflation to food

inflation. Operational management become skilled at

dealing with day-to-day challenges. Over several years,

managing lower prices became a core competence. The

shift to persistent food inflation creates new challenges

as customers resist price increases no matter how well

the increases are motivated. Better management of

customer expectations has become a priority.


The business is sensitive to upward pressure on

food prices, labour and distribution costs and any

constraints on the consumer’s level of disposable

income. Sensitivity is controlled by the continued

GDP growth in the United Kingdom, Belgium and

the Netherlands and the high income enjoyed by

consumers in all markets. The net effect of the chief

economic variables is regarded as mildly positive.

Differentiation

Bidvest Europe differentiates itself as a proactive

partner that anticipates customer requirements and

addresses them through appropriate investment,

quality systems and reliable service delivery by

experienced, knowledgeable and innovative staff. Our

professionalism and scale of operations enable total

solutions with the potential to create new efficiencies

within our customers’ business.

This value proposition has growing relevance as

marketplace pressures and sustainability issues come

to the fore. Local sourcing of products and the use of

authentic, natural products are increasingly important.

Providing comprehensive information on all the

attributes of the various products and food groups

has become essential. Our service offering is now

underpinned by specialist assistance such as kitchen

design for our customers.

Bidvest Europe has long been known for its ability to

provide a total logistics solution. We are now strongly

communicating the message that our solutions “don’t

stop with the drop”.

Proudly Bidvest

In the last 12 months, awareness has grown within

the British and European markets of Bidvest as a major

international player in the foodservice industry. The

Bidvest name is carried by all truck fleets and at all

companies, including the recently acquired businesses

in Belgium and throughout the Netherlands.

The corporate strapline “First for Foodservice” is

deployed across the livery in all national markets, from

London to Brussels and Amsterdam and through to

Australasia, providing a consistent marketing promise

and a unifying element in our corporate identity.

Bidvest recognition is positive among large companies

and is helpful when forming alliances with suppliers

and other parties.

Sustainability issues

Our status as the preferred employer in our sector was

underscored in March when 3663 First for Foodservice

was listed by the London Sunday Times as one of the

United Kingdom’s top 20 “Big Companies To Work For”.

We are the only food wholesale distribution company

on the list.

In June, the British government and the Institute

of Fundraising bestowed a silver award on 3663 for

facilitating sustained “payroll giving” by our employees.

Focused internal communication has raised awareness


of the scheme whereby 6,5% of the workforce currently

donates to charity via the payroll system, raising about

£25 000 a year.

We receive high sustainability noting as we are

the only foodservice company in our markets to

achieve ISO 14001 accreditation at every depot. This

benchmark for quality control and environmental

management indicates that we adopt best world

practice to ensure our operations have minimum

impact on the environment.

We use bio-diesel in our fleet and are taking measures

to recycle cooking oil from our customers and

suppliers where possible, and convert it into bio-diesel.

By committing to the use of bio-diesel made from

used cooking oil we are taking the lead in the use of

sustainable fuels.

The processing of virgin oil may reduce dependence

on fossil fuel, but has the effect of restricting the

acreage used for food production as crops are

increasingly diverted for ethanol manufacture.

Ultimately, food prices rise.

Our fleet of more than 1 000 trucks has given an

industry lead in the sustainable use of used cooking

and vegetable oil by concluding supply arrangements

with an oil re-processing plant. We currently use

20 000 litres of bio-fuel a week from this plant, all

derived from used oil provided by our customers and

suppliers.

These arrangements went into operation in the final

quarter. We are encouraging more customers and

suppliers to collect used oil for recycling and plan to

substantially increase our use of bio-fuel from this plant

over time.

The “weeding and seeding” of our ranges constantly

focuses on product innovation and new formulations

to promote healthy eating and improved nutrition.



The future

After a year of consolidation, renewed growth in

revenue and trading profit will be sought in 2008.

Food inflation and higher interest rates create

challenges in the United Kingdom market, but range

management and range extension offer opportunities

for further growth while new efficiencies will also be

pursued. The possibility of closer integration across the

sales teams is being examined in detail.

Strong forward momentum has been built up by our

business in the Netherlands. This highly motivated

team is poised for further success and will be

supported by new investment in depot expansion

and an extended central chill facility. Opportunities for

acquisition-led growth will also be examined.

The base of our operations in Belgium has been

significantly expanded following the Kruidenier

acquisition. However, this business is not expected

to be earnings-positive for some time as the cost of

substantial reorganisation will have to be absorbed.

The full-year effect of recent management changes

at Deli XL Belgium will be felt in 2008. Some revenue

growth has already been achieved. Further gains in

market share will be pursued.

Horeca, our Dubai-based foodservice operation, has

doubled the size of its business in 18 months and is

committed to further growth. The hospitality boom

in the United Arab Emirates has shown no sign of

abating while new opportunities are opening up in the

institutional market, notably the hospital sector.

3663 FIRST FOR FOODSERVICE

United Kingdom

We competed strongly and tendered aggressively to

secure several gains in new business and our non-food

operations achieved strong growth.

The Manchester-based The Barton Meat Company is

staging a recovery following losses earlier in the year.

Substantial new investment has been made in our

Manchester infrastructure. The new facility opened in

April 2006 and continued benefits are evident.

The frozen, fresh and chilled division recorded

another year of pleasing sales growth. To address the

continuing trend to procurement consolidation, the

possibility of wider integration of the sales effort is

being investigated. Training investment may be further

increased in view of the need to advise customers on

products across a wider range.

A new operating system has been designed and will

be implemented in the coming year as the existing IT

system reaches the end of its useful life.

DELI XL

Belgium

The business entrenched its leadership position in

the national market and benefited from management

changes at a strategic, sales and operational level.

Improved performance was achieved, with higher

standards of service and quality coming through.

Efficiencies and growth opportunities will be pursued

by more rigorous category management and range

extension where appropriate. Better alignment with

customer needs is being achieved and pack size

changes and new formulations are being introduced.

The Kruidenier acquisition brings improved geographic

balance to the business and creates a strong platform

for future growth.

Netherlands

The Dutch team put in an upbeat performance

with strong gains in market share and trading profit.

Electronic Euro-tendering has transformed the

institutional market and Deli XL Netherlands has

emerged as the leader. Further inroads have been


made into the hospitality market and strong organic

growth has been achieved across major national

catering accounts.

The business has made full use of the decentralised

Bidvest model to design and implement its own

solutions, maximising its in-house knowledge of the

Dutch foodservice market. The result is significant

operational, buying, marketing and sales gains. Margins

and expenses are well controlled.

The team will entrench its relationships with a growing

customer-base by offering a fuller logistics solution to

exploit bigger European volumes.

HORECA TRADE

United Arab Emirates

The business achieved pleasing gains in turnover

and trading profit for the second successive year. The

United Arab Emirates hotel sector continues to grow

at a rapid rate. Dubai has emerged as a major tourist

destination and venue for global sporting events.

The product range is being continually expanded.

Product sales have also benefited from the acquisition

of several international agencies. The expansion of

the agency portfolio has been facilitated by Horeca’s

growing reputation for applying world best practice.

The broadline foodservice proposition is being

systematically developed. A new freezer facility is being

built while Horeca staff members are being trained by

their British counterparts to support a wider product

offering.

Opportunities for expansion into other Gulf States are

being explored.


A leading multi-range manufacturer

and distributor of food products and

ingredients. Bidfood operates through

strategically located independent

business units in southern Africa, aimed

at servicing the catering, hospitality,

leisure, bakery, poultry, meat and food

processing industries.

Review of operations – Bidfood

Value propositionBidfood offers customers efficiencies of scale, national support and the assurance of consistent quality. International and local alliances and our own food technology capabilities enable Bidfood to work in partnership with clients to develop quality, market-leading solutions backed by food safety programmes that set the industry benchmark.

Macro factorsLargely stable exchange rates were beneficial for Speciality Foods, while continued GDP growth was positive for all operational units. The hospitality sector is a major beneficiary of the country’s continued economic upturn, with strong growth evident in both general tourism and business travel. These developments were positive for Caterplus and contributed to improved overall performance.

Crown National, a division of Bidfood Ingredients, and Patley’s drew particular benefit from the economic upturn. Higher interest rates and somewhat stronger consumer inflation had little overall impact on our business.

Industry developmentsManagement successfully addressed the key challenge of managing the transition from very low food inflation in 2006 to higher food inflation in 2007. However, the significant increase in food inflation in the second half of the year could be cause for concern if a worsening trend leads to substantially increased prices.

Some shortages have become evident in some food categories, notably seafood and certain spices, while

> Trading profi t increases to R279,8 million

> Revenue reaches R3,8 billion

> Continued employment creation

> Reorganisation programme within division;

three distinct entities, Caterplus, Bidfood

Ingredients and Speciality

Charles SingerChief executive Bidfood Ingredients

Brent VarcoeManaging director Caterplus

Masly NotricaManaging director Speciality


6,2%


the prices of some major commodities such as maize have risen as a result of lower local production.

National challengesGrowing pressure on South Africa’s road infrastructure and constant increases in the price of fuel have showcased a continuing challenge for all distribution businesses – delivery efficiency. Within Bidfood operations, the strategic goal is to bring the biggest basket of the best available products to our customers with each single delivery. This endeavour will result in a longer delivery cost per product delivered. Though higher distribution costs sharpen the challenge, the net effect is to increase our competitive advantage as a national supplier offering the broadest range of products to customers in every corner of the country. Continuing investment in IT support and a significant investment in upgrading distribution infrastructure will tend to entrench this advantage.

RisksBusiness risks are little changed. Health scares and outbreaks of a disease such as avian flu affect food consumption patterns. Some risk-proofing is afforded by Bidfood’s status as a food safety leader that continues to make strong progress on the road to full compliance with HACCP (hazard critical control point) requirements. As a broadline supplier, we provide alternatives no matter what food group is affected by a sudden shift in demand.

Bidfood operations are “ahead of the curve” when it comes to food safety. International experience indicates this is an area of growing public concern, though South African consumers are not yet as sensitive to the issue as consumers in markets such as western Europe. We encourage more rigorous food safety controls, both on imports and within the domestic market. We believe our proactive positioning will deliver strategic benefits going forward. We are constantly aware of our responsibility to deliver food products that have undergone rigorous food safety tests.

Sensitivity analysisWe provide a balanced mix of premium brands and basic foodstuffs and ingredients. An operational unit such as Speciality Foods may be sensitive to a marked



weakness in the exchange rate or lower levels of disposable income, but the impact is cushioned by the breadth of the range across our other operational units.

Crime as it impacts international perceptions is an area of acute sensitivity for all businesses serving the hospitality industry, but the impact cannot be precisely calibrated or fully mitigated. The momentum created on the run-in to the 2010 Soccer World Cup will help to reduce the sensitivity.

In general terms, the key economic variables – GDP growth and relatively stable exchange and interest rates – were broadly favourable in 2007 and are expected to remain so.

Proudly BidvestThe Proudly Bidvest positioning has been strongly expressed at Group level at exactly the right time for Bidfood as the focus area for our business is to obtain maximum leverage from our national representation and strength as a value-adding partner of our customers.

Proudly Bidvest is prominently featured in vehicle livery and all corporate identity elements. The Bidvest connection is also a source of reassurance for larger clients while the Group’s strong BEE credentials are helpful when we are significant contributors to divisional and corporate procurement programmes.

DifferentiationCaterplus is the only company in our industry capable of supporting nationally represented customers with predictable, high quality standards of service. We are strategic players in a market subject to tactical incursion by aggressive local competitors that lack the resources to offer complete solutions.

We constantly invest in quality people and modern facilities. As such, we are the only supplier that can assist customers by developing new solutions to key business challenges, including the constant change in consumer tastes, continuing cost pressures and recurring affordability issues in some income groups.

We are a partner as well as a supplier.

New structuresA series of structural adjustments has been made to address areas of under-performance in some segments of the business. The results of the reorganisation have been positive to date, but benefits will not be fully apparent until 2008.

There were no new acquisitions and no businesses were disposed of. However, several divisional transfers have helped to tighten the focus of our business.

Lufil, the KwaZulu-Natal manufacturer and distributor of paper products, has been re-housed within Bidpaper Plus. Hotel Amenities has moved under the Bidserv banner. Vulcan, the catering equipment manufacturer, is now part of Bid Industrial and Commercial Products. However, some Bidfood operations maintain their position in the equipment and utensil market as high-profile importers and distributors of leading international brands.

Bidbake’s performance has been most disappointing, resulting in changes to the management structure. Two separate management teams have been established, one to run yeast manufacturing operations and the second to manage the bakery ingredient business. As a result, the unified Bidbake identity has been discontinued.

Bidfood Technologies no longer resides within the Crown Foods Group. The unit has been given separate status in view of the growing importance of a strong food technology capability as a source of strategic advantage and will focus on developing products and efficiencies for all production units in the Bidfood Ingredients division.

At Caterplus, a single management team has been made responsible for a merged catering supplies and frozen foods operation.

TrainingTraining investment continues to rise. Training spend per employee rose from R1 171 to R1 337. We supported the managerial aspirations of our top performers by increasing reliance on the leadership courses presented by The Bidvest Academy.


BEE and CSIGood progress has been made across the various elements of the BEE scorecard while BEE procurement rose to R764,0 million, despite our more streamlined organisational structure.

Corporate social investment continues to have an educational bias, with special attention paid to food hygiene and nutrition.

InnovationMany South African food manufacturers are still committed to irradiation. However, irradiation as a means of controlling spoilage, killing bacteria and destroying pathogens such as salmonella is becoming increasingly controversial and no longer meets European Union standards.

As consumer awareness of the issue grows in South Africa, our proactive investment in steam sterilisation and food safety systems will further differentiate Bidfood Ingredients as a reliable partner that delivers a quality product. New investmentInvestment in support of HACCP compliance continues across Bidfood while the national roll-out of the Great Plains IT system at Caterplus is continuing.

ChallengesThere is continuing need to stay ahead of legislative and regulatory requirements and anticipate consumer concerns in areas such as food safety, quality and hygiene. Bidfood does not regard this as a challenge, but as a potential source of competitive advantage in a market where we are the natural partner of quality-conscious customers.

FutureThe macro-economic climate remains supportive while remedial action to streamline the business and eradicate areas of under-performance has helped us to build renewed momentum. We are well positioned to achieve further growth in market share and trading profit.

CATERPLUSRevenue rose 23,8% to R2,2 billion while trading profit increased 21,2% to R156,5 million. At 71,6%, the return on funds employed is significantly higher.

The frozen foods operation and the catering or grocery supplies businesses were successfully merged, moving from a structure defined by the temperature range to a single entity serving five geographic regions. Seventeen grocery and 12 frozen food units were integrated into the merged business. No new acquisitions were made.

The key feature of the year was the successful alignment of two distinct cultures, enabling Caterplus to aggressively compete for market share with a consolidated range of 8 000 dry products and 1 400 frozen food items. This entrenches our value proposition of a broader solution made available on a national basis.

Success is also being achieved in the strategy of complementing our penetration of large national accounts with strong gains among smaller customers. The efficiency of dealing with a one-stop supplier has to be strongly communicated to this price-sensitive market. Growth opportunities beckon, but we acknowledge that higher interest rates have increased the credit risk among smaller, more localised customers.

Every sales representative and telesales staff member has been exposed to a new sales development programme. Furthermore, driving staff have been equipped with customer-service skills to support their regular face-to-face interaction with customers.



BEE improvements are consistently achieved, though we are still short of our 2009 targets in some categories. However, procurement among small black businesses is ahead of target; so is the representation of black staff in middle management and professional grades.

Our consolidation into a unified culture will receive another boost with the relocation of the Chipkins and Sea World businesses to new, back-to-back head offices at Linbro Park, Johannesburg. We also plan to move two Western Cape operations into a new Cape Town building by the end of 2008.

Transfer to larger, more modern premises will help us address a key challenge – crime. Higher security is part of the design specification at our new premises and should significantly reduce shrinkage.

Strong growth is projected if South Africa’s economic fundamentals remain positive. Keeping food inflation below 10,0% will be a key factor in many segments of our business.

We hope to achieve a significant increase in revenue and trading profit and plan to strengthen our Free State infrastructure. Enhanced cross-selling opportunities – a major benefit of the new structure – will be vigorously exploited by all operations.

More job growth is anticipated and the training budget will be doubled yet again. To reinforce the new high-performance culture, incentive programmes are being introduced for every staff member. Each individual will be measured against key performance indicators.

SPECIALITY Extremely good revenue growth was achieved, up 29,2%. Momentum is still building following the refocusing of the business two years ago and the strategic decision to differentiate ourselves from other food importers and wholesalers by repositioning Patley’s as the brand-building partner of our principals. We do not collect, we select brands. Our brand basket is dominated by category leaders or contenders for leadership.

Operating profit was up by 30,6%. A key contributor to the pleasing performance was improved management of our margins despite volatility coming from the rand.

The Alpro range of soya milk products was introduced to the Patley’s range and has strengthened our offering of speciality products. The Tabasco brand, acquired a year earlier, further enhanced our profile of handling leading brands and performed in line with expectations.

Continued GDP growth and the emergence of a new middle class were also positive for the business. Patley’s is known for aspirational, lifestyle brands. Growing numbers of upwardly progressive consumers entrench the appeal of these imported products.

Crime is a strong negative, necessitating investment in rigorous controls. But there is perverse upside for a business that specialises in aspirational food brands as entertaining in the safety of one’s home remains a strong trend.

Stronger inflation had little impact. Our focus on mid- and higher-income consumers provides an element of inflation-proofing. South Africa’s industrial relations climate worsened somewhat, but labour relations within the division remain good. Credit risk was not significantly affected by higher interest rates as Patley’s has a blue-chip customer-base.

The advantages of our business model were showcased during the year. Barriers to entry are relatively high in a sector serving the retail industry while we continue to occupy a unique position in the industry as a brand partner prepared to invest alongside brand principals in brand development. The robustness of our model has helped us double our turnover every five years for the last 15 years. Growth has been achieved without acquisition. We remain confident that further organic growth can be achieved in the coming year.

The move to a new Johannesburg head office is imminent. Relocation from Herriotdale to Crown Mines will provide more space without sacrificing the logistic efficiencies of an address close to Johannesburg’s distribution hub at City Deep. Warehousing doubles to 11 000m2 and will lead to operational efficiencies. Divisional operations in Durban and Cape Town are also expected to relocate to modern and expanded premises during 2008.


Opportunities for expansion into Namibia and Mpumalanga province (South Africa) will be explored. Further widening of the distribution network to convenience stores is also a prospect.

BIDFOOD INGREDIENTSCrown Foods Group recorded pleasing growth in revenue and trading profit, but Bidbake’s performance continued to disappoint. Bidbake achieved some turnover growth, but margin pressure intensified. Remedial action was taken. Two operations were closed and production from Bidbake’s KwaZulu-Natal factories was consolidated at Longmeadow, Johannesburg. The yeast production and bakery supplies businesses were separated, while the food technology unit became a subdivision. The new Bidfood Ingredients structure became operational in April.

Overall revenue at Bidfood Ingredients rose to R1,25 billion, an increase of 9,2% while trading profit of R98,6 million was recorded.

Macro conditions were supportive, though competitive pressures grew. Performance was also affected by the disruptive effects of relocation to modern premises at Longmeadow.

The reorganisation houses all food ingredient businesses within a single structure and creates opportunities for supply synergies across the food industry while optimising our managerial resources.

Recent capital expenditure on manufacturing and warehousing facilities is expected to yield significant efficiencies while the establishment of a well-resourced food technology business strengthens our position as a product design innovator.

Increases in food inflation have tended to heighten our competitive advantage. The progression from food deflation to food inflation accentuates the need among our customers for smart solutions that contain costs or add to product appeal. As the industry’s food technology partner we are ideally placed to respond.

Our Microsafe food safety programme is the industry benchmark for microbiological and chemical analysis and laboratory evaluations. Microsafe has developed

a comprehensive HACCP programme and has created a strong technical services arm to support our customers. In 2007, a further R10 million was invested in food safety.

New product development and innovation are supported by alliances with international partners. We are sole distributors across southern Africa for the world leaders in meat processing, vacuum-packaging and other equipment.

The Group’s Proudly Bidvest image is being leveraged to reinforce the positioning of Bidfood Ingredients as the pre-eminent national player in our industry. Bidvest’s reputation as a BEE pacesetter is increasingly important to us and we will seek new BEE ratings in 2008.

In the coming year, the benefit of corrective action will be increasingly felt as will the investment in new facilities in both Johannesburg and Cape Town. Crown Foods is well positioned to derive advantage from largely favourable macro conditions. The yeast manufacturing and bakery supplies businesses have already benefited from tighter focus. Improved performance is anticipated. Bid Bros, the cash-and-carry concept announced last year, will be strongly supported and will roll-out nationally.

Bidfood Ingredients will continue to seek distribution synergies and look to optimise the cross-selling opportunities created by the new structure. Growth in both revenue and trading profit will be energetically pursued.


Myron BerzackChief executive

A leading manufacturer and distributor

of electrical products, appliances

and services, offi ce stationery, offi ce

furniture, packaging closures and

catering equipment in southern Africa

and the United Kingdom.

Review of operations – Bid Industrial and Commercial Products

Value proposition

Bid Industrial and Commercial Products has the stature

to work in conjunction with major customers to deliver

economies of scale while its decentralised structure

enables agile and responsive subsidiaries to operate

as proactive solution finders in specialised areas. This

makes Bid Industrial and Commercial Products a

valued supplier or contributor whatever the scale of

operations.

Macro factors

High levels of business confidence were reflected

in strong investment in capital-intensive projects

while government and the parastatals made strategic

investment in major infrastructure projects.

Inflation and interest rates moved higher, but

consumer spending and corporate investment

were not significantly affected. From a year-on-year

perspective, exchange rates were relatively stable

while extreme price movements moderated in key

commodity markets such as copper.

Industry issues

Annualised volatility in commodity markets and

exchange rates may have eased, but day-by-day shifts

can still be significant. The timing challenge when

placing or phasing in large orders remains acute.

Indeed, the challenge may have been compounded

as the customer expects greater price stability in

what is perceived to be a more manageable trading

environment.

The trend to generally higher inflation was positive

for trading activities as the expectation of wholesale

pricing pressure encouraged customers to add to their

inventory.

The construction industry is a major beneficiary

of infrastructure-led growth. Higher interest rates

may lead to a cooling off in the rate of residential

property development, but commercial, industrial

and infrastructure projects are expected to roll out for

several years.

> Trading profi t up 48,7% to R742,7 million

> Revenue increased by 23,8% to R8,6 billion

> Versalec Cables settled in division

> LS distributorship and integration of Vulcan

Catering Equipment strengthened division

> New investment of R131 million in systems,

infrastructure and people development

> Voltex digital “shop window” carries all

65 000 items in range


16,3%


The public focuses on infrastructure development

ahead of the 2010 Soccer World Cup, but in our

opinion the timeframe is at least a few years longer.

Business relevance

Strong demand for cable and electrical fittings is

built into the design specification of many current

infrastructure projects, including the Gautrain high-

speed rail link and ancillary developments.

These demands provide a strong underpin for the

activities of our electrical wholesaling division.

Urbanisation and the emergence of a new middle-class

are not only positive for businesses with direct retail

exposure, they also have long-term knock-on effects for

our operations as many of our commercial customers

are expanding to meet these needs.

National growth challenges

Perhaps the most pertinent national challenge is that

facing the electricity supply industry as it strives to

provide the generating capacity to meet the power

demands of a South African economy growing at 5,0%

a year.

Major investment is being made in capacity expansion

and the strengthening of transmission and distribution

systems, but Eskom has made it clear that national

energy goals can only be achieved by more intensive

demand-side management. The cheap electricity

era is coming to an end. Electricity prices will rise

to incentivise energy saving. The Department of

Minerals and Energy has set national targets for

demand reductions and some of South Africa’s biggest

employers have signed the National Business Initiative’s

Energy Efficiency Accord targeting a 15,0% demand cut

by 2015.

Bid Industrial and Commercial Products was an early

“recruit” to Eskom’s demand-side management division.

In the two years since achieving accreditation as an

energy service company, Voltex Lighting has carried

out numerous energy audits at factories and offices

around the country. We are positioned as reliable



partners of major groups seeking demand-side

efficiencies. As energy costs increase, this positioning

will become even more important.

One of the trends of 2007 was for companies to install

or investigate the installation of their own generating

capacity. We expect this trend to continue.

Challenges

HIV/Aids and skills shortages remain challenges.

We address them by continued investment. The

talent-retention challenge continues to increase. Any

industry leader – the “tall poppy” – faces special attack

as it consistently invests in people development.

Participation in a leadership programme at a top

company immediately increases an individual’s

marketability. Talent retention has therefore become a

strategic business issue.

Training investment reached R18,7 million while a total

of 51 251 training hours was logged.

Strong GDP growth for the last three years and

generally buoyant business conditions have created

some novel challenges. For example, definitions are

blurring as companies expand into ancillary activities,

moving up or downstream; maybe both.

This can affect long-standing relationships. A supplier

can become a customer or a customer can become a

competitor. These acts of reinvention are typical of a

dynamic growth economy and can lead to an attack

on a core market from a surprising quarter. The effect is

to sharpen the twin challenges of staying close to your

industry and your customers.

Another growth-related challenge involves one’s own

business focus.

The strong economy and national initiatives (for

example, infrastructure-led growth and energy

efficiency) can lead to sudden and substantial increases

in demand for specific products or skills. The challenge

is to optimise every opportunity without neglecting

core competence. Retaining focus in management

teams eager for growth in new areas is becoming

a critical discipline – never neglect your bread-and-

butter business lines.

Risks

Business risks show little change. Exchange rate

risks have been cushioned somewhat by reduced

volatility. Credit risk has risen, and not only as a result

of higher interest rates. The favourable business

climate has encouraged many entrepreneurs to “go it

alone”. As part of our black economic empowerment

commitment we try to be supportive. We advance

credit and may even advise on appropriate

stockholdings.

We acknowledge, however, that credit extension to

start-up businesses entails risks. Our mitigation strategy

is to stay close to these new customers and monitor

credit levels closely.

Crime remains a major risk area for every business

with substantial assets. We constantly improve our

infrastructure. Modern premises and investment in

security systems add to our costs, but mitigate the

risk. The real problems occur when organised crime

identifies a business as a “soft target”. This makes

continued investment in sophisticated systems

unavoidable.


We are sensitive to economic variables such as the

growth rate, business confidence and the rate of

fixed investment. In all instances, current exposure is

positive. Mild inflation is relatively positive as well.

Rand weakness reduces competitive pressure from

imports. Moderate movements in either direction

are increasingly managed by adjusting the balance

of our import and local manufacturing operations.

We manufacture and distribute strong local brands.

We also have alliances with quality offshore suppliers.

Local manufacture requires appropriate volumes.


Price competitiveness may require a stronger import

component across our range. Our management teams

have shown themselves to be adept at managing this

balancing act.

We have little immediate exposure to interest rate

increases designed to create a consumer credit

squeeze. The effect is felt to a degree by some of

our stationery businesses. Our sensitivity increases

when interest rate rises persist and affect business

confidence.

Proudly Bidvest

Business units, notably Waltons, have embraced the

Bidvest mymarket e-procurement initiative and derive

substantial benefits. The leveraging of inter-group

strength and buying power is a source of competitive

advantage in some areas. Proudly Bidvest has become

a key component in the editorial mix of company

marketing material, the CN Business brochure being

an example, and has elicited a positive response from

customers.

Differentiation

The scale of our operations and our extensive national

footprint enable us to offer pricing efficiencies and

the promise of professionalism and reliability. Our

companies are well resourced. Our stockholding can

be substantial. Our track record for customer support is

well established.

This value proposition is being accentuated by the

pace of growth in some segments of the economy.

As companies become concerned about reported

bottlenecks or stock shortages, the business case

for dealing with the well-resourced market leader is

further strengthened.

New structures

In May, Vulcan Catering Equipment joined our

manufacturing operations following a restructuring at

our sister-company Bidfood. In November, we acquired

the distributorship for LS products, a strong electrical

products and accessories brand that will support our

penetration of the commercial and industrial sectors.

New investment

Significant investment was made in branch

infrastructure across all business units. The nationwide

process involved new branch openings, relocations,

refurbishment and additional facilities.

Waltons, in particular, made good progress with the

strategic upgrade of its retail identity while further

strengthening its Gauteng footprint through new store

openings in Park Meadows, Strubens Valley, The Wedge

(Morningside) and Fourways. CN Business continued

its ongoing programme of showroom renovation and

strengthened its distribution infrastructure with the

opening of a new Gauteng warehouse.

Innovation

To provide a total solution to customers, Voltex has

launched a collaborative effort with the builders of

electrical distribution boards. These specialists are

allowed to work from our premises on the design and

development of these products. This gives the board

builder instant access to all the necessary resources

while we strengthen the relationship with the industrial

customer or the projects that require distribution

panels.

Stronger central support for our internal customers

– our branches – remains a point of focus. We recently

formed a 2010 committee to identify opportunities

linked to major infrastructure projects. The committee



will coordinate the efforts of all divisional companies

and branches, remove duplication and ensure efficient

service.

Central support on this pattern was successfully

pioneered a year ago when we created two initial

committees to assist branches with national contracts.

A technical committee was given the task of evaluating

the technical performance of our products to ensure

they meet all relevant specifications. Strict quality

control in support of the sales function has become

vital as competitive pressures mount.

Simultaneously, a tender committee was set up to

examine tender documents and develop quotes on

behalf of our branches.

These central support functions take the pressure off

branches, enabling them to concentrate on customer

service and sales.

In addition, we have imported an exclusive range of

quality Korean manufactured electrical products, the

LS brand, and are marketing them directly through

our branch network. This creates an opportunity for

branch operations to drive the growth of a new range

without relying solely on price differentiation for similar

products.


A further initiative involves the development of a new

generation of leaders by identifying and fast-tracking

staff with high potential. This “Top 100” programme is

open to all, with strong representation by historically

disadvantaged South Africans.

Candidates take two in-house exams; one to test

general knowledge, the other to assess their ability

to deal with issues that frequently face management

in our industry. Those who succeed will have further

exposure to new role-play and problem-solving

exercises. No one “fails” as all participants are free to

re-take the initial tests at a later stage, by which time

they will be better prepared.

It is hoped the process will help to prepare a new wave

of managers for responsible positions and help retain

BEE talent – a major challenge.

BEE improvements are consistently achieved across

the division. Waltons has achieved an “AA Level 3

Contributor” BEE rating and has established a national

BEE committee to drive sustained improvement. All

the other businesses are currently awaiting their new

ratings.

BEE procurement reached R2,3 billion, representing

51,8% of our discretionary spend.


R3,7 million was spent on corporate social investment.

The process is driven at local level by our branches,

ensuring strong focus on community upliftment.

The future

Bid Industrial and Commercial Products will pursue

double digit growth in both revenue and trading profit

in 2008. The economic environment is expected to

remain generally positive in the core South African

market, though the rising trend in interest rates will

have to be watched closely. Credit and cash flow

management will be key focus areas for the entire

division.

Our pursuit of new business in the municipal and

parastatal sectors will be assisted by the full-year

effect of the newly promulgated codes of good

empowerment practice. In the past, potential

customers sometimes applied arbitrary weightings to

various elements of the BEE scorecard. Promulgation

of the revised codes will ensure greater consistency in

BEE scoring and interpretation. This trend was noted

toward the end of the reporting period and enabled

many of our companies to make inroads at municipal,

parastatal and governmental level.

Though continued growth in the domestic market is

anticipated, export opportunities will not be neglected.

Opportunities exist for the export of patented and

strongly branded products.


VOLTEX ELECTRICAL DISTRIBUTION

Favourable macro factors solidly underpinned a

strong performance by both our wholesale and

specialist supply businesses. A weakening rand was

a net positive for the business while copper price

fluctuations created some trading opportunities.

Competitive pressures continue to mount and Chinese

imports create a strategic challenge, but the situation is

generally well managed.

A strong performance was put in by Versalec, the

Johannesburg-based distributor of cables that was

acquired a year ago. Versalec offerings have enabled

us to extend our range and reach new customers. We

also enjoyed the full-year benefit of our acquisition

of Litemore Electrical. As anticipated at the time

of the Litemore transaction, improved coverage of

growth areas at Mossel Bay and Oudtshoorn has been

achieved.

We continue to grow our business in the mining sector.

Our patented mining light has been further refined

and continues to enjoy wide acceptance. Export

opportunities for this product are being investigated.

A new “let-us-quote” feature on our website has been

well received by customers.

A number of trading branches have now been

rebranded as Voltex.

Planning has begun in our search for a new company-

wide enterprise resource planning system. Phased

implementation is planned for the second half of 2008.

Investment in research and development for new and

the upgrading of existing products continues.

The sales team has been strengthened in anticipation

of continued strong growth. However, some challenges

are evident. The pace of housing development in the

Western Cape appears to be slowing while the knock-

on effects on our customers of higher interest rates

and the National Credit Act will have to be monitored

carefully.

BERZACK

Challenges persist in the supply of industrial sewing

and embroidery machines and ancillary products to

customers in the garment, luggage and upholstery

sectors. The South African and Chinese governments

have agreed a quota system to regulate the flow of

Chinese imports, but the arrangements have yet to

bed in and interpretations differ. Berzack, however,

achieved some notable successes with the launch of

new ranges in the domestic appliance segment of the

market.

EASTMAN STAPLES

This United Kingdom supplier of sewing machines

and ancillary products has completed a major

rationalisation programme. The British garment

industry faces continued pressure from Chinese

imports and expense management remains rigorous.

Improved results were achieved.

FURNITURE AND STATIONERY

Infrastructure growth, buoyant spending across

South Africa’s new middle class, accelerating

urbanisation and high business and consumer

confidence were strongly positive for our business

units in the office furniture, stationery and computer

consumables markets. Numerous corporate office

relocations and upgrades led to an active furniture

project market. Dauphin Office Seating in particular

was a major beneficiary of this trend.



Pleasing growth in trading profit and revenue was

recorded in this environment. Sustained growth

prompted renewed expansion of several branch

networks.

Kolok has relocated branches in Port Elizabeth and

Namibia while a new branch opened in Nelspruit at

year end. Walton’s southern and northern regions have

been consolidated, new retail branches have opened

and existing stores are being upgraded to put added

emphasis on furniture showrooms.

A restructure is in progress within Waltons Gauteng

to improve commercial distribution while the high

growth of the furniture division within Waltons may

lead to further expansion of the distribution facilities.

Specialist furniture sales consultants have been

employed to drive this growth. In Waltons Gauteng

alone, 22 of these specialists have been employed.

CN Business, South Africa’s largest distributor of

office furniture, successfully relaunched its core

brand and strongly positioned its sub-brands

– CN Café, CN Corporate and ACTA SA. Output

at CN Manufacturing was stepped up while new

efficiencies have been achieved at the Gauteng

warehouse of CN Business following a complete

upgrade of their facilities.

Expansion has proceeded hand-in-hand with job

growth. Staff complements have increased at

Dauphin, CN Business and Waltons, among others.

Significant challenges are also evident. New entrants

have emerged in all our markets and competition has

intensified. Government encouragement of small and

medium enterprises creates new customers (which is

good), but they have limited credit history, creating a

risk management challenge. Competition from Chinese

furniture imports has been addressed at Seating by a

shift from local to off-shore production. CN Business

also made good use of the opportunity to source

off-shore products and improve its competitive edge.

Pressure on margins was particularly acute on

“commodity products”, especially Kolok’s computer

consumables. Talent-retention pressure is also evident,

resulting in increased investment in an amenable

working environment.

The side effects of high national growth require

increasing management attention. Waltons office

furniture has experienced supply bottlenecks and

our stationery business is subject to repeated price

increases from the paper mills. Purchase forecasting is

complicated by intermittent shortages (for example,

supplies of board) while congestion at our ports affects

import delivery.

The overall picture remains strongly positive.

Investment in expanded or upgraded infrastructure,

efficiency improvements through newly implemented

enterprise resource planning systems and strong focus

by highly motivated teams are expected to contribute

to another upbeat performance in 2008. New business

gains were achieved in governmental and parastatal

sectors by CN Business, Waltons and others. Expanding

this base will be one of our priorities.

PACKAGING CLOSURES

South Africa’s leading manufacturers of packaging

enclosures, strapping and tape achieved a good

performance buoyed by sustained growth across

the economy. Strong demand across our range was

apparent throughout the period.

The company has drawn benefit from last year’s

rationalisation programme and the rebalancing of

the production and import ratio of our business. The

consolidation of factories has continued while the

business of IWD was acquired and has been integrated

into Afcom.

Increased imports of certain product ranges have

enabled us to gain market share in key areas. To drive

further growth, we have expanded our sales force and

employed more specialist personnel to strengthen our

technical support.


Though business conditions remain favourable, skills

shortages, raw material shortages and commodity

price fluctuations create continuing challenges.

Business confidence remains high and many customers

are expanding their operations – positive signals for

our business. Strong focus will have to be maintained

on supply chain management, especially the supply

situation from Asia. Maintaining an appropriate balance

between local production and imports remains a focus

area. Despite these challenges, we expect further

growth.

The continuing upsurge in construction activity is

proving extremely positive for Ramset, one of the

leading suppliers of power-actuated tools to the

construction sector.

VULCAN CATERING EQUIPMENT

This leading South African manufacturer of catering

equipment drew benefit from the continued strength

of the hospitality sector, largely the result of increased

tourist inflows. Closer integration of the administration,

manufacturing and distribution components of

the business resulted in significant efficiency gains.

The business was also strengthened by improved

relationships with existing international principals

and the securing of new international principals. The

enhancement of the leading international technology

available to us has complemented strong Vulcan-

manufactured house brands.

Revenue increased beyond budgeted expectations and

pleasing growth in trading profit was achieved.

A R10 million investment in plant and machinery will

allow us to sustain higher volumes while maintaining

our quality profile. Vulcan offers complete solutions to

complex catering needs. Increased training investment

and the ongoing development of a service culture will

ensure this marketplace position in 2008 is entrenched.

Continued growth will be vigorously pursued.


Neil BirchChief executive

A leading manufacturer, supplier

and distributor of commercial offi ce

products, printer products, services and

stationery and packaging products

through a wide network of outlets in

southern Africa.

Review of operations – Bidpaper Plus

Value proposition

Bidpaper Plus is a one-stop, nationally represented

solution-finder offering procurement and pricing

efficiencies at the consistently high levels of quality and

reliability demanded by a blue-chip customer-base.

Introduction

Revenue was in line with management expectations as

the previous year’s sales were significantly boosted by

large election materials contracts at Lithotech.

Major contract gains were achieved by our export

projects division with the contract to supply ballots to

the Nigerian election while the Lithotech corporate

sales team had a number of successes on the national

account front.

Continued success was achieved with the strategy to

position Bidpaper Plus as a provider of digital and new

technology solutions that complement our traditional

base in print production. The launch of our digital

pen and paper set underlined the e-proposition.

The product is supported by locally hosted software,

process servers and infrastructure to combine

traditional pen-and-paper documentation with digital

record keeping.

A further highlight was the implementation at

many centres of a new, standardised management

information system.

Macro factors

Strong GDP growth and high levels of retail activity

were positive for the business, particularly bill

presentment and print-to-post and fulfilment services.

There are signs that retail activity may slacken as

the national strategy puts increasing emphasis on

infrastructure-led growth. But this had no material

effect. The impact of the new National Credit Act is not

yet apparent, but the Act is anticipated to both add to

and subtract from client communication activities.

Exchange rate fluctuations and the behaviour of local

monopolies and duopolies continue to be significant

issues and are cause for growing concern.

> Trading profi t rose 16,6% to R226,9 million

> Revenue from continuing operations fl at at

R1,8 billion

> Successful consolidation of new structures in

fi rst full year

> Greater balance achieved in organisational

structure

> Strategic positioning as provider of digital and

technology solutions to complement print

production


5,0%


Mondi has exited the market for self-copying paper

and lightweight uncoated stock, leaving Sappi the sole

local supplier of lightweight paper. A 10,0% price rise

was the result, ascribed to limited local capacity. The

increase puts the price at about the same level as the

cost of imported papers.

In a competitive market, the ability to control

or influence input costs is critical to business

sustainability. Steps are therefore being taken to reduce

our vulnerability to unilateral action by dominant

suppliers.

Constant – and significant – increases in fuel prices are

an abiding concern.

Skills shortages are another critical issue. We are

increasing our training investment while looking at

new ways of deriving optimum advantage from this

growing budget.


Supply bottlenecks created by the pressures of

prolonged national growth are not yet a major issue,

though there are signs that we may be affected by

certain constraints.

The key restriction is load-shedding and power-sharing

caused by rising electricity demand and consequent

pressure on national generating capacity. Printing

presses and associated equipment are major users

of electricity. Reliable power is critical to us; so is our

reputation as a dependable, on-time supplier.

Following a series of power outages in centres around

South Africa, we have invested in our own power

generation equipment to assure continuity of supply

on time-sensitive projects. We are still rolling out

these installations. Back-up at every operation is not

economically viable, but will be available at strategic

points.

Limited local capacity in the manufacture and supply

of lightweight papers for the scholastic market is the



first bottleneck that specifically applies to our industry.

Moving to higher weights of paper is suggested as a

way around the problem, but the cost implications are

significant for the consumer.

Risks

There has been no change in business risks. The

major risks are exchange rates, crime and credit risk.

Insolvency levels are quite low in our high-growth

economy, but criminality has taken off. Non-payment

of accounts may not be linked to a customer’s

commercial difficulties, but deliberate fraud. Quite

sophisticated scams have been reported.

We are fair but firm in our approach to credit and the

fulfilment of contractual obligations – ours and those

of our clients. We also benefit from the fact that we

work on major national accounts and for international

organisations with reputations to protect.

The consistency of our approach works for us. We

deal in Africa with official departments, donors and

foreign aid projects, and apply rigorous controls. We

do not bend rules or cut corners. We are ethical and

transparent. We deliver quality, on time and within

budget and will not take on a job if we know it cannot

be completed on deadline and within previously

agreed quality parameters.


We are sensitive to rand weakness and inflation

beyond 5,0%.

If industry inflation (driven principally by wage

settlements and paper prices) rises above this level,

the result is margin pressure. The same applies when

rand weakness moves out of the 5,0% band. The

reason is that customer attitudes have been shaped

by several years of low inflation. Customers now

regard any increase above 5,0% as unacceptable. We

offer quality solutions in support of long-standing

relationships. Cost-cutting that compromises quality

also compromises this marketplace positioning. High

inflation and pronounced rand weakness could leave

us vulnerable to attack by price-cutters who do not

have these reputational concerns.

We are also sensitive to the abuse of monopoly or

duopoly power. For example, the post office is both a

“partner” (as we use its services) and a competitor (as

it strives to enter the laser print market and become

a direct participant in the market for mail services). In

either capacity, we are vulnerable to increased postal

charges or unilateral actions.

We are also impacted by the behaviour and pricing

practices of dominant local paper manufacturers and

suppliers.

Proudly Bidvest

We donated R1 million in educational materials to

under-privileged schools as part of a Gauteng regional

initiative under the Croxley brand and the Proudly

Bidvest banner. The media was quick to associate

this donation with the “Hear for Life” initiative in

conjunction with Radio 94.7. This Proudly Bidvest

donation aligned us with the rest of the Group

at a time when corporate advertising and sports

sponsorship had increased the public’s awareness of

the overall brand.

Differentiation

Our national footprint makes us the natural partner

of large corporates that expect consistently high

standards of national service as well as potential

savings through efficiencies of scale.

We store product on behalf of large customers in major

metropolitan centres and produce their standardised

documents in volume.

Cost efficiency is not the only customer benefit. Many

large companies increasingly support brand equity

through a rigorously applied corporate image. The

required “look” is being extended to a wider and wider

range of printed material in all regions – a trend that

benefits a national player such as ourselves.


Our value proposition is underscored by a growing

reputation for innovation and the proactive

introduction of digital solutions. We constantly scan the

technology horizon and introduce products that we

know will deliver a benefit to our customers. The digital

pen is the latest example.

Convenience is another key customer benefit. We

house a multitude of solutions in one environment

and have the capacity to customise any solution to the

needs of specific clients. This has growing appeal in a

corporate environment where procurement efficiencies

are aggressively pursued.

Disintermediation is no longer a strong trend and

the e-auction approach to procurement is in retreat.

Value-add is the key requirement. The preference for

one point of supply that offers efficient solutions at

predictable quality levels is good for us.

International opportunities

We printed ballot papers for the Nigerian polls, but the

scope of this contract was quite limited in comparison

with the substantial projects in support of the

Democratic Republic of Congo elections a year earlier.

We have now established our credentials and a track

record for quality in this area and in future we aim to

secure at least one major African election project a

year.

Training

Skills shortages continue to plague the industry.

Training issues were characterised by dislocation

and controversy at industry level and by successful

innovation and new investment within the company.

Conflict arose between the industry training authority

(MAPPP seta) and training initiatives driven by the

Printing Industries Federation. Funding for the Printing

College was affected. Personal antagonism and

allegations in the Press were not helpful at a time when

skills transfer is a national priority.

Lithotech is committed to increasing its investment in

industry-related learnerships and 39 new learnerships

have been registered with the MAPPP seta since 2005.

Our internal training investment increased to

R3,1 million (about 1% of payroll). More than 33 000

facilitated training hours were recorded involving over

1 200 employees.

The training strategy has been modified to meet our

changing needs. Competitive pressures make the

sales function critical. The quality of our representation

and the knowledge of our people have become key

differentiators in an industry in which we often act

as consultants and solution finders. The challenge is

spotlighted by the growth of electronic solutions. In

this field, we are selling new technology and its ability

to deliver quality gains and cost efficiencies.

We are therefore giving greater emphasis to sales

training without compromising our long-standing

commitment to technical and artisan training.

The process entails skills training, detailed product

knowledge and individual coaching to ensure sales

teams are thoroughly prepared.

New sales training programmes were launched in

October last year. There are twin goals: high levels

of professionalism and cost efficiency. The cost of

servicing a broad customer-base continues to increase.



Greater revenue per representative per call is the aim

while customers will benefit from quality support from

quality staff. Taking our products to market through a

better prepared, knowledge-led sales force will cement

long-term relationships while growing market share.

New structures

Lufil, a manufacturer of paper products and packaging,

has been integrated into the new packaging and label

products division. This KwaZulu-Natal business was

acquired more than a year ago by Bidfood as the Lufil

range includes items in strong demand in the catering

and restaurant sectors. The unit’s transfer to Bidpaper

Plus has created an opportunity to strengthen the

packaging component of the business.

Our organisational structure has traditionally been

dominated by Lithotech business units (now housed

in the printing and related activities division). Greater

balance is being achieved by removing packaging

and label-manufacturing units from the old family of

Lithotech businesses and housing them in packaging

and label products. Further expansion of this division is

envisaged.


Progress has been achieved on all aspects of the

BEE scorecard. Lithotech has been awarded an “A”

empowerment rating (previously “BBB”), a process

supported by the Group’s strong empowerment

credentials. Other individual business units – notably

Silveray and Lufil – will now seek their own ratings.

Scorecard improvements are the responsibility of

individual business units and will continue to receive

focused attention as we strive to improve overall

compliance with group targets.

It should be acknowledged, however, that the

appointment of senior black managers at operational

level is a continuing challenge. Unfortunately, lack of

in-depth industry experience cannot be made good

by investments in early talent identification, skills

transfer and fast-tracking. Sincere commitment over

the long haul is the only way this industry legacy can

be addressed.

Procurement from black business continues to grow at

pace and now tops half a billion rand – almost 40% of

total procurement – up from 31% in the previous year.


A new CSI strategy was agreed in 2006 to build

commitment by local teams to local communities and

issues. This more focused approach is now adopted by

all businesses. Each unit now has a CSI budget and is

accountable for achieving maximum impact and full

staff buy-in for the community-based mission. Staff

identify projects where there is a demonstrable need

and where even a relatively small commitment will

make a big difference.

“Sweat equity” from staff members adds a multiplier to

the financial donation. One example involved an old-

age home on the East Rand where our staff worked

to refurbish the facilities while financial assistance

resulted in the provision of new beds in the frail-care

centre. In the Eastern Cape, our people provided

building materials and helped to repair broken-down

schoolrooms in an under-resourced area where

schooling threatened to come to a standstill.

Innovation

Printing and traditional label manufacture is a mature

industry, but Bidpaper Plus focuses increasingly on

mailing and personalisation, e-mail and IT solutions

and other areas with high technology content. In this

environment, innovation is constant.

We are working on electronic bill presentment

platforms that offer an alternative to (or complement)

the bank debit order. Net tools and mobile technology

alert the consumer to the “e-bill”. Remote electronic

payment is actioned by personal authorisation.


The project highlights Group synergies as the banking

licence held by Bidvest Bank is a prerequisite for

development of such tools.

Online business card ordering systems developed

by Bidpaper Plus enjoy growing acceptance at many

major companies. The system relies on standardised

templates with pre-proofed wording and signed-off

corporate identity and corporate colours.

Email Connection is the first South African company to

offer an e-bill with embedded speech capabilities to

assist the visually impaired. The technology employs

descriptive language that is understood by the most

commonly used screen-reading applications, enabling

logical document navigation.

The initiative, in association with the National

Council for the Blind, held an important lesson – that

innovators with a social responsibility commitment

should not wait to be approached by those with some

form of impairment, but should be proactive. The

council indicates that currently about 5 000 visually

impaired people have access to computers. Companies

trying to reach these users can now do so via the

platform developed by Email Connection.

New investment

Approximately R100 million was invested or committed

to systems and new or upgraded plant.

National roll-out of the new MIS will not be completed

until the second half of 2007, but significant

improvements were rapidly evident in operations that

benefited from early installation of the system.

The previous, highly decentralised IT system inhibited

the interchange of information across regions and

sister companies. Standardised architecture now

enables more information to be called up and

compared, permitting the analysis of sales and

performance across regions. We can assess the

penetration of national accounts, identify opportunities

and improve our service to customers.

The full benefit of timely reporting and prompt

response to market changes will only be apparent in

2008.

An investment of R60,0 million has been made in new

and refurbished plant at Silveray Manufacturing. Better

product quality, higher productivity and improved

capacity will give us the platform from which to regain

market share in the stationery sector, especially the

scholastic market.

In addition, Ozalid (a coater of pressure sensitive

materials and converter of materials into finished

labels) has invested in an ultraviolet silicone coater

and has imported a hot-melt coater from the

United Kingdom.

Challenges

HIV/Aids remains a focus area. Voluntary testing has

long been available, as has awareness training. After

so many years of education and awareness-raising,

the principal challenge is audience apathy as the

impact of even the starkest message can wear off. The

educational battle will continue.

Environmental protection is a matter of good business

practice. Paper waste is collected for recycling

whenever possible. We scan technology sets for new

solutions that use fewer virgin materials and less

electricity.



Business is on notice from Eskom, South Africa’s

national electricity supplier, that the cheap energy

era is coming to a close. Increasing attention is

therefore being paid to energy efficiency as both an

environmental and business imperative.

Reduction of waste is another focus area. We were early

adopters of computer-to-plate technology in sheet-

fed printing. We are now applying this technology to

forms production. Computer-to-plate printing means

there is no need for positives and negatives (saving on

materials, chemicals and time). In addition, print quality

is greatly enhanced.

All legislative requirements relating to the use and

removal of chemicals, inks and hazardous substances

are strictly observed. The company has a reputation for

providing a safe and healthy working environment.

The future

After a year of consolidation, Bidpaper Plus will exploit

synergies and seek expansion through both acquisition

and growth in market share.

The search for new partners is an opportunity for

enterprise development and the creation of joint

ventures. Our employee trust is a ready-made vehicle

for joint venture formation to further improve our black

economic empowerment credentials – a key focus area

in 2008.

Ozalid has already expanded into hot-melt adhesive

production and will pursue opportunities in the

growing market for self-adhesive labels.

The investment in new plant at Silveray Manufacturing

paves the way for further expansion into the market for

scholastic stationery, both domestically and into Africa.

The African market for educational materials creates

opportunities for synergy. Our track record in the

supply of election kits across Africa has given us

exposure to the needs of customers across the

continent. We have simultaneously established our

credentials with several international agencies. These

bodies not only encourage democratic transformation,

but engage in numerous upliftment projects, including

educational work. This base gives us the chance to

extend the scope of our cross-border activities.

A key point of focus will be to secure ongoing

contracts to supply election materials to African

and international jurisdictions. We recently won the

contract to supply kits for elections in the Comores.

Increased international sales will enable us to draw

some tactical advantage from periods of rand

weakness, though we will continue to be at net risk

when the currency softens.

Improved efficiency and the reduction of business risk

remain a strategic priority. Our level of dependence

on South Africa’s entrenched paper-manufacturing

duopoly will be under constant scrutiny.

We intend to review the price competitiveness and

sample all grades of imported paper. Our new structure

facilitates the consolidation of paper purchasing.

Significant annual tonnages are involved, enabling

us to exploit efficiencies of scale. We may become

permanent importers of certain grades.

Most observers predict continued expansion of the

national economy despite higher interest rates. After

a year of consolidation, this should prove to be a

favourable climate in which to pursue gains in market

share and growth in both revenue and profit.

PRINTING AND RELATED

Personalisation and mail

The division has established its three linked points

of presence across the country, providing customers

with distribution of mail into the postal system in

Cape Town, Johannesburg and Durban. The benefits

are speed to post and backup from added services.

A number of large outsource initiatives among leading

South African businesses are the focus of the division’s

growth strategy.


Printing and conversion

The diverse print offering of Bidpaper Plus is

underpinned by the substantial print capability

required by many of our customers. These businesses

continue to benefit from the demand for export

projects, base printing utilised in laser and mail

campaigns and general print fulfilment services.

Sales and distribution

Most sales of Lithotech products are through the

national sales force which offers an ever-increasing

range to a diverse customer-base. The new sales

training strategy will accelerate in 2008, delivering

tangible efficiencies and allowing further penetration

of the markets for new and traditional products. Where

necessary, specialist sales teams will be created to

enable more rapid market penetration.

STATIONERY DISTRIBUTION

Following a year of consolidation at the stationery

distribution business of Silveray Statmark, the systems

and infrastructure are in place to meet the quality

requirements of all customers. The rejuvenation of the

Croxley brand is under way. Initial results are pleasing.

The focus in the coming year will be on establishing

correct inventory levels and marketing the new

capabilities of the re-equipped stationery factory.

ALTERNATIVE PRODUCTS

The division’s “Plus products” address the requirement

for paper-replacement solutions. E-mail is now

accepted as a convenient and efficient alternative

to conventional mail, as reflected in the substantial

growth of the Email Connection business. The design

and processing infrastructure for the digital pen and

paper solution is largely in place. The subdivision will

now concentrate on converting the high level of

interest in this product into sales.

PACKAGING AND LABEL PRODUCTS

The establishment of the label business as a

major supplier to this sector has been slower than

anticipated. The product offering has been refined

and we are confident that inroads will be made.

Focused efforts by a more dedicated sales team are

also expected to yield improved results. The inclusion

of Lufil Packaging into this new subdivision will allow

us to offer complementary products to markets already

served by other Bidpaper Plus business units. The

technical synergies within the broader division should

result in production efficiencies at Lufil, while further

benefits will accrue from the new focus on strategic

procurement of paper and other common materials.


Brand PretoriusChief executive

Review of operations – Bid Auto

Value propositionThe preferred quality and value provider of automotive products and services for private and corporate customers across all market segments.

IntroductionBid Auto has achieved a succession of stellar results since the McCarthy acquisition and its integration into Bidvest three years ago, but a slowdown was experienced after a series of adverse macro and industry developments. The effects were particularly evident in the last quarter of the financial year.

Continued diversification from the historical reliance on new car retailing cushioned the impact and has given the business a strong platform for ongoing growth in a reshaped trading environment.

Macro factorsThe lower interest rate environment came to an end in June 2006 and over the next 12 months the Reserve Bank’s monetary policy committee pushed up rates by 250 basis points. The effect on consumer spending in the automotive sector was marked. Vehicle repossessions by the financial institutions moved higher. Our auctioneering business derived some advantage, but the net effect is negative as this environment has an impact on consumer confidence.

Consumer confidence moderated and increased buyer caution in the passenger car market was apparent by year end. The authorities continued to express concern at the high level of household debt – which reached a record high of 73,7% of disposable income in the first quarter of calendar 2007. The lending practices of financial institutions came under increasing official scrutiny, culminating in the promulgation of the National Credit Act on June 1 2007.

Only one month of trading activity was affected in the current period, but the Act’s effects were significant. The debt disclosure and verification requirements not only filter out over-extended consumers, but also delay the sales process. We are confident that processes can be accelerated while still respecting the Act and the consumer’s interests. However, it may take some time to bed in new procedures.

Though exchange rates were generally stable, the net trend was toward rand weakness.

> Trading profi t growth of 16,6% to

R724,3 million


> 39,5% return on funds employed

> Total retail sales rose to 88 989

> Acquisition of Shell Autoserv network

> R1 billion acquisition of Transnet’s fl eet

management and leasing business, Viamax

Holdings, eff ective September 2007

Bid Auto

One of South Africa’s largest motor

vehicle retailing and service groups.

Bid Auto off ers leading motor brands

through over 130 dealerships and

service outlets, backed by fi nancial and

fl eet services, a loyalty programme and

the country’s leading online retailer of

new and pre-owned vehicles.


15,9%


Higher fixed investment by government, the parastatals and the private sector was beneficial for the construction industry and associated activities. Business confidence remained high.

Industry factorsA weaker rand translated into price increases for some vehicle buyers for the first time in three years while a year of fuel price increases pushed up the overall cost of motoring.

New vehicle sales slowed, but the slowdown has to be put into context. The single most important industry dynamic is positive – unprecedented growth. Five years ago, new vehicle sales appeared to have stalled at 350 000. In calendar 2007, the motor industry expects new vehicle sales to reach almost 700 000 units.

Fifty-four vehicle brands today crowd a South African market that represents just 0,8% of world sales. Customers can now choose from more than 1 300 model derivatives. Competition has become intense while manufacturer demands for brand support from their dealers continue to mount. The result is constant margin pressure. The Bid Auto margin improved from 3,7% to 3,85% due to diversification and good equity portfolio returns.

A major structural change is also evident in our industry. The historical pattern was for low and mid-income families to graduate to new-car purchasing via the used-car market. This has changed following the market entry of so many manufacturers offering competitively priced new cars. Approximately 40,0% of new passenger car sales fall into the entry level and small categories. This means many first-time owners now buy new, putting pressure on used vehicle margins even at times when new vehicle sales slacken.

The surge in construction activity has helped to support stronger commercial vehicle sales across the motor industry. Bid Auto’s new vehicle sales are traditionally split 70/30 in favour of passenger vehicles. Our long-term efforts to strengthen the commercial element will receive a boost early in the new financial year with the launch of our range of Chinese light commercial vehicles.



Response has been positive to the first offerings, a range of pick-ups and a mini-bus taxi, a unit well positioned to benefit from government’s taxi recapitalisation programme. Our new entrant satisfied all the requirements of the South African Bureau of Standards and was soon placed on the Department of Transport’s “approved list”.

South Africa’s shift to infrastructure-led growth is expected to underpin the market penetration of our new McCarthy Heavy Equipment business, dubbed Yellow Metal by the press. The new operation, launched in February, imports, distributes and provides after-sales support for heavy equipment from China, including bulldozers and excavators.

Challenges of national growthThe rapid creation of a new, upwardly progressive middle class is one of the most obvious consequences of government’s strategy of combating poverty through higher economic growth and black economic empowerment. The principal effect in our industry is a doubling of the size of the new vehicle market in a little over three years. This puts huge pressure on industry resources, including skilled manpower and physical infrastructure such as service bays and parking areas.

Bid Auto has responded with extended facilities and the deployment of increasingly sophisticated customer information platforms to speed the job-flow. Ambitious expansion plans are in progress while the training of more technical apprentices has been stepped up.

RisksBusiness risks stay the same, though they are accentuated by the intensity of competition.

Principal risks relate to interest rates, exchange rates, consumer and business confidence and the one-sided nature of franchise agreements. Implementation of the NCA is confirmation that legislative risk can sometimes be substantial. Legislators are now finalising the Consumer Protection Bill.

Macro factors are beyond the control of any business unit risk committee, but the industry as a whole has a credible voice and is widely consulted before any legislative or regulatory action. Furthermore, the industry has shown itself to be extremely adaptable.

We have moved from a totally protected industry with 115,0% protection to a 30,0% duty environment characterised by intense competition.

Bid Auto has adopted a proactive stance in an increasingly consumer-friendly legislative environment. We endorse ethical marketing practices and train all staff – from technicians to showroom personnel – to be pro-consumer, open and scrupulously fair.

Adverse effects springing from the dominance of franchise principals can be cushioned by improving the balance of the business, widening the spread of activities and, most importantly, meeting the expectations of our suppliers.

Sensitivity analysisNew and used vehicle sales remain very sensitive to business and consumer confidence, as well as vehicle affordability. Exchange rate movements and interest rate changes remain key indicators.

Fifty percent of the models in our passenger vehicle market are fully imported. The import component varies across the “domestic” brands. Rand weakness ultimately leads to price increases, but competitive and inventory factors can delay the impact.

Interest rates obviously affect affordability, but the precise relationship between, say, a 1,0% rise and sales is difficult to calculate in a market with the growth dynamics of the last four years. Vehicle purchasing can also be affected by emotional factors.

Proudly BidvestPride in Bidvest is underpinned by the practical benefit of our membership of a group with such strong positions in the leisure, hotel and travel markets. We believe much of the increased growth of Budget Rent a Car – with market share up from 13,0% to 18,0% in a highly competitive sector – can be attributed to Bidvest influence. Our dealerships also enjoy substantial support from Bidvest subsidiaries.

Substantial funding facilities available to us through the Bidvest treasury have enabled us to expand and accelerate strategic diversification.


Bidvest’s impressive empowerment credentials help us to win customers and build new relationships, notably in the municipal and parastatal sectors. At the same time, they address a key area of manufacturer concern – that their dealerships rapidly develop a credible empowerment profile.

Our people’s participation at The Bidvest Academy is an increasingly important motivator for executives eager to build a career within the Group’s “successor generation”. The ultimate benchmark for our top performers has become recognition at the Bidvest Chief Executive Awards.

DifferentiationBid Auto differentiates itself in terms of service quality and value. We strive to be the first choice in the eyes of all our customers in terms of quality and service.

We support this commitment by investing in our own customer research and customer satisfaction indexes. All incentive programmes are linked to customer satisfaction, from sales staff to senior executives.

We lead the retail motor industry in the application of customer satisfaction indexing to the used-car market. The level dropped in 2006 and became the subject of intense turnaround efforts. The score has subsequently risen to an all-time high of 86,8%.

New structuresThe scope of our activities has widened as a result of the diversification programme while added emphasis has been given to activities such as used-car sales and our parts and service business.

McCarthy PreOwned has been rebranded as McCarthy Call-a-Car Direct and McCarthy Call-a-Car Virtual (for those who prefer a Net platform to a showroom). At the same time the used-vehicle footprint has been expanded with the addition of seven McCarthy Value Centres. Though margin pressures remain a concern, we believe the used-vehicle market will make a comeback. Broader infrastructure is necessary to exploit the opportunity, as well as to create more capacity for the disposal of Budget Rent a Car and Viamax buy-backs.

We launched our McCarthy Value Centre concept in March and by mid-year seven operations had been established. Ten will be in operation by the end of 2007, the majority close to shopping centres to encourage the habit of dropping the family car off for a service when the consumer pops to the shops.

SynergiesMcCarthy Value Centres will not only sell affordable quality used cars, but act as the marketing channel for a growing range of affordable Chinese vehicles. The intention is to create the preferred showcase for value-sensitive customers whether they are in the market for new or quality used vehicles.

Other synergies will also be exploited. For example, our Budget Rent a Car and Budget Van Rental operations show exceptional growth. Their fleets have expanded from 3 800 in 2003 to 8 000 units. When the rental cars come to the end of their nine-month life at Budget, these units will be fed into the quality used-vehicle market through the value centres and our franchise dealerships.

Acquisitions and investmentsWe invested R280,0 million in new dealerships, facility expansion and refurbishment.

In February, we acquired Shell Autoserv, a national chain of 28 standalone service centres; though the effective date was April 1 as Competition Commission approval had to be sought. We retained all staff. The chain has now been rebranded as McCarthy Value Serv and will give added momentum to our strategic drive



to expand our parts and service business. The chain will focus on out-of-warranty vehicles and provide long-term support infrastructure for our Chinese vehicle brands.

The industry forecast is for the market segment for four to seven year-old vehicles to increase in the medium term from 20,8% to just under 30,0% of the vehicle population. This equates to more than 3 000 000 vehicles. South Africa has a vehicle population of 7 000 000. Franchise dealers service only 1 500 000 of them.

We have also begun importing Chinese heavy equipment, the Shantui and Yuchai brands, and believe our heavy equipment division will receive strong market support.

Further diversification is on the near-term horizon when the Viamax fleet management and leasing operation is integrated into Bid Auto. It represents a major expansion of our fleet management capability.

The range of Budget activities was extended in 2007 with the introduction of point-to-point Chauffeur Drive. In addition, we bought a majority share in Inyanga Motors, giving us DaimlerChrysler representation in two growth areas, Empangeni and Vryheid.

TrainingOur spending on development was R18,5 million while 20 610 days’ training took place involving 10 190 course attendances and 7 352 training days being delivered to external clients.

The company’s training centres remain the only employer-owned, fully SAQA-accredited institutions in the motor industry able to offer national certificates across levels 2 to 5 of the National Qualification Framework (NQF) in vehicle service and maintenance, autotronics, sales and support services. McCarthy’s Automotive Artisan Academy managed 500 internal and 387 external automotive learnerships. McCarthy technical trainees achieved 252 qualifications at the NQF2 to 5 levels.

A further 41 learners were trained on our sales cadet programme. A management skills programme has been successfully piloted while 12 high potential managers and staff attended The Bidvest Academy and graduate academy.

Diversity management receives increasing support. All executives have attended a series of transformational experiences over five days and 1 082 managers and staff benefited from a two-day diversity training programme.

Black economic empowermentBroad-based black economic empowerment and transformation remain a moral, strategic and business imperative for us. We have positioned our transformation agenda in accordance with the finalised BBBEE codes of good practice and Bidvest inter-divisional transformation structures.

Enterprise development remains a point of focus. Small medium micro enterprises projects have been implemented at our Nissan Diesel and Toyota dealerships and we have partnered a black businessman at our East London Value Centre.

Our partnership with the South African Taxi Council at Toyota Gezina goes from strength to strength and through Budget Van Rental we continue to give opportunities to historically disadvantaged South Africans.

Interventions such as the McCarthy emerging business leaders programme and the management understudy programme are in place to accelerate employment equity.

Corporate social investmentCSI spend increased year-on-year to R3,0 million. The focus remains on community upliftment and education.

In May, McCarthy coordinated the tenth year of the Rally to Read programme, an initiative focused on English literacy at primary schools in rural areas. Nine rallies, funded by 94 sponsors, set out in 450 vehicles to reach 143 rural schools employing 1 040 educators and serving 32 800 learners. Funds raised reached a record R5,5 million. A book of celebration, New Chapters was published in April and has been widely acclaimed.

InnovationThe McCarthy Value Centre-concept is groundbreaking and has the potential to create South Africa’s first fully integrated value-for-money vehicle parts and service network.


The world-class status of our state-of-the-art Client for Life customer relationship management programme was confirmed when Toyota SA signed a five-year contract with our Eliance subsidiary. The programme, which cost us R30 million to develop, is being rolled out to all local Toyota dealerships. The possibility of a follow-up international roll-out is being investigated.

Our call a car business continues to set the benchmark for electronic vehicle retailing. The system celebrated its tenth anniversary in August 2007. More than 50 000 units have been sold since inception via the internet and associated call centres.

Challenges and disappointmentsThe plan to source Russian vehicles for the mini-bus taxi market created a succession of challenges, despite our efforts in collaboration with SANTACO to ensure these vehicles met the demands of this testing market. In view of product quality and reliability concerns, we recalled all GAZ units. We spent R15 million on this customer-support programme, keeping our promise to the market. McCarthy will continue to provide aftersales support to existing owners, but will not import any new Gazelles. However, the local distribution of other vehicles from the GAZ International stable is under consideration.

It was decided at year end to close the student wheels division as the concept received limited market support. No staff retrenchments are envisaged as personnel will be absorbed into the growing chain of value centres.

HIV/Aids remains a continuing concern. Aids awareness and education were integrated into our wellness programmes at an early date and our Lifeline counselling service continues to do sterling work. These efforts have to be continually reinforced.

The futureThe interest rate climate is expected to remain challenging and further exchange rate weakness may adversely affect vehicle affordability. South African consumers have taken on board a record level of debt. The net result in the automotive industry is expected to be a marginal decline in total vehicle sales and increased pressure on margins.

Despite these challenges, Bid Auto intends to pursue profit growth in 2008. This is a bold target. It reflects our confidence in the momentum being built up by our diversification strategy. However, we acknowledge that growth-focused initiatives such as the heavy equipment division, the importation and distribution of vehicles from China and the nationwide value centres are still under development, and will require substantial investment in the initial phases. This may affect the level of returns. We anticipate meaningful growth in the construction sector and will further broaden the brand bouquet at McCarthy Heavy Equipment.

In 2008, we will derive only a nine-month benefit from the operation of Viamax, but thereafter we expect this fleet management business to make a substantial contribution to Bid Auto. We are also upbeat about the contribution of our financial services and import and distribution activities.

Diversification has reached critical mass. Motor retailing accounted for 47% of our profit. In 2008, these activities will remain the biggest single contributor to the bottom line, but will probably account for just 38% of profit. The financial services’ share of the pie is expected to grow from 33% to 36%, while imports and distribution activities should double their contribution, from 7% to 15%.

Some short-term challenges are in sight, but we are confident about the continued growth of the South African economy, our industry and Bid Auto. We have a strong management team that has shown itself well able to meet the challenges of the future.



MOTOR RETAILBMW/Mini (Forsdicks)Growth in new vehicle sales proved challenging at our dealerships in Pinetown, Sandton and Tygervalley, though used-vehicle trading staged a recovery and pleasing results were achieved by aftersales. Tygervalley repair centre came into operation in July and the Tygervalley dealership began trading out of their new Mini facility in February 2007.

General MotorsNew vehicle sales were on target, but used vehicle sales were disappointing. Aftersales performance was strong. A McCarthy Call-a-Car Direct facility opened in Gezina and a large dealership will open early in the new period at Menlyn, Pretoria. It will carry the full GM range and is expected to boost our aftersales business. A new parts warehouse is nearing completion in Montana, Pretoria.

Land Rover/VolvoLand Rover performed exceptionally well, with outstanding Range Rover Sport and Discovery 3 sales and improved aftersales profits. The model line-up has been refreshed by the introduction of the all-new Freelander 2 and a new-look Defender. Intense competition in the premium passenger car segment inhibited Volvo sales growth. Our Parow Land Rover dealership has been relocated to N1 City. McCarthy Volvo in Pietermaritzburg was named most improved Volvo dealer of the year.

DaimlerChryslerCar-buying activity at Mercedes-Benz was affected by a pause ahead of the imminent launch of a new C class. Mercedes-Benz commercial vehicles did well. Sales of Chrysler, Jeep, Dodge and Mitsubishi were disrupted by new model introductions and vehicle shortages. The luxury used-car market remains challenging, though aftersales performance was positive.

We have opened a new Mitsubishi dealership in Midrand. A Mercedes-Benz/Chrysler/Jeep/Dodge branch campus in Centurion is nearing completion and we have begun the development of a Mercedes-Benz lifestyle centre in Menlyn, Pretoria. An exciting development was the acquisition of Inyanga Motors which boasts two outlets in KwaZulu-Natal North (Empangeni and Vryheid).

Nissan/Fiat/Alfa/RenaultNissan SA recognised McCarthy Nissan Sandton as the best in its category and overall dealer of the year while McCarthy Nissan Germiston won the annual accolades for aftersales and service. Fiat and Alfa continued to grow and in 2008 will open a new parts distribution centre. Renault dealerships performed strongly and made good progress with aftersales. Our heavy commercial division was the star performer, with excellent sales and returns and won gold awards from Nissan Diesel SA in most categories. The performance of our two Renault dealerships is improving, with our outlet at The Glen (Johannesburg South) making particularly good progress.

PeugeotThe Peugeot brand struggled to retain market share, though we managed to maintain a significant portion of the marque’s unit sales. Aftersales showed pleasing growth. Improved performance is expected in the coming year as the marque refocuses its marketing and representation. The launch of the new 308 should also have a positive effect.

ToyotaTrading profit and return on sales improved. Passenger vehicle sales were enhanced by the introduction of the Yaris T1 and the Avanza range while the launch of three Lexus models and the opening of our Kingsmead Lexus facility boosted Lexus sales tenfold. Commercial sales increased by 23,9%. Profits from used vehicles fell, but after-sales achieved strong growth as most vehicles are now covered by free service plans, resulting in high service customer retention.

Our Midrand Lexus and Tableview Toyota dealerships will open later this year. Further Toyota dealerships are planned for Gezina, Lynwood and Woodmead while another Lexus dealership is planned for Pretoria. McCarthy Toyota Trucks in Midrand was nominated as Toyota South Africa’s truck dealer of the year.

Volkswagen/Audi/SeatNet profit before tax rose 39,0%. Increased used vehicle focus resulted in the sale of equal numbers of new and used units while both parts and service departments achieved combined growth of more than 41,3%. Relocation of our Prince’s Park dealership to Silver Lakes went well. We plan to open a specialist commercial


dealership in Witbank in December following steady growth of the VW commercial range. We anticipate a challenging 2008 as no significant model launches are planned.

Our associate company, Autohaus Centurion, has undergone a major revamp with the separation of Audi and VW into two independent dealerships which comply with all corporate branding. In spite of this disruption, net profit before tax rose 10,3% and return on net assets was excellent at 169,0%.

BURCHMORESBurchmores increased profit before tax by 105,7% in a record year. Synergies with the McCarthy group and an increase in bank repossessions contributed to the good performance while our “Wholesale to the Public” concept ensured continual walk-through traffic. Unit sales rose 67,5%. We have invested in a new IT system and are positioned for another successful year.

IMPORT AND DISTRIBUTIONVechile Import and DistributionDirect sourcing of two Chinese brands has been finalised. Foton is supplying a 13-seater mini-bus taxi and a panel van while Meiya, a subsidiary of FAW, China’s largest vehicle manufacturer, is providing a range of single and double-cab one-ton pick-ups and a sports utility vehicle. The launch takes place early in the 2008 period. The product base will be broadened over the medium term to create a comprehensive range of affordable passenger and commercial vehicles.

McCarthy Value Centres and Value ServA national network of McCarthy Value Centres and Value Serv outlets has been established to support our new Chinese brands. By mid-2007 10 value centres and 28 standalone Value Serv outlets were in operation. The used-vehicle departments of the value centres will trade under the McCarthy Call-a-Car Direct banner, and their service departments as Value Serv.

The value centre in Parow has obtained the Mahindra franchise as well, and the Klerksdorp outlet has added Tata vehicles to its range. It represents our group’s first foray into sales of vehicles of Indian origin.

GAZ SA Problems with vehicle reliability resulted in poor retail sales of the Gazelle mini-bus taxi and GAZ SA incurred

significant losses. The retail and wholesale operations of GAZ SA have been incorporated into the vehicle import and distribution division and the McCarthy Value Centres, realising significant savings.

McCarthy Heavy EquipmentWe have sole distribution rights for the Shantui and Yuchai ranges and began operations by establishing a base in Boksburg. The opening of a Cape Town branch is imminent. Market entry has progressed well and we sold 18 units by year end. Negotiations with another Chinese brand, SANY are well advanced and we plan new equipment offerings, including lifting, concrete-, asphalt- and earth-moving equipment.

Yamaha DistributorsA record first quarter was followed by a succession of challenges, including the NCA’s introduction, the launch of the eNaTIS registration system and restrictions on the use of all-terrain vehicles. Even so, the business achieved budget. The music division has moved into new premises with a state-of-the-art demonstration studio theatre, leading to improved sales of high-end professional audio equipment.

New boat packages, a redesigned Yamaha golf car range and the introduction of Hitachi LCD and plasma technology to our audio visual range bode well for 2008.

FINANCIAL SERVICESMcCarthy Insurance ServicesSignificant growth was achieved with over 100 000 policyholders joining our customer-base. However, the NCA will affect future revenue and cash flows as



the sale of certain single-premium or term policies has been disallowed.

The performance of all business units exceeded expectations and claims and expenses were effectively managed. All business units increased their profitability with the exception of the “motor comprehensive” category which incurred a small underwriting loss.

McCarthy FinanceOur book grew by 14,2% and the number of accounts topped the 57 000 mark. Profit fell due to an increase in bad debts, a lower rate yield and margin squeeze. Continued expansion of Bid Auto’s dealer network creates growth opportunities, but next year’s environment will be challenging in view of the full-year impact of the NCA, lower consumer confidence and interest rate pressure. Bad debt management is a focus area.

McCarthy Fleet Services We more than doubled our debtor book while maintaining our record for zero bad debt. All new business is priced for profit. Staff numbers remained stable despite the massive increase in volumes. The main focus in 2008 is the integration of the Viamax and McCarthy Fleet Services operations, giving us a 10 000-strong fleet and market share of 15,0%. This creates the strongest platform in the industry for the financing, leasing and management of both state-owned and corporate vehicle fleets. Significant group synergies will also be exploited.

CAR AND VAN RENTALDespite worldwide competition, we were proud recipients of the Budget Rent a Car franchise of the year award, thanks to dedicated staff and the support of Bidvest companies. We have improved market share and have expanded our product offering with the launch of Budget Door 2 Door transfer and chauffeur services in Gauteng, KwaZulu-Natal and Western Cape. We opened van rental operations in the West Rand, Vaal Triangle, East Rand, KwaZulu-Natal and Eastern Cape. This gives us coverage across southern Africa, allowing us to expand into major accounts. We plan to invest R5 million on a new Windhoek depot to cater for expected growth in tourist volumes.

SUPPORT SERVICES and CORPORATE SERVICESMcCarthy Call-a-CarWe entrenched our position as South Africa’s leading online motor retailer and despite difficult trading conditions in the used-car market, generated sales of 7 500 vehicles. We have now sold more than 50 000 vehicles since inception. We have begun to move from a purely virtual platform to a clicks-and-mortar model. The call-a-car brand is being extended to McCarthy’s used-car retail outlets, utilising the McCarthy Call-a-Car Direct brand. Call a car direct outlets are being rolled out nationally.

Club McCarthy Increased sales of new and used cars and higher loyalty rates drove our continued growth. The benefits package, which includes roadside and household emergency assistance and a broad range of discount offers, was further enhanced. Membership has reached 134 000.

Corporate MarketingWe continue to exploit Bidvest opportunities through dedicated relationship management and trouble-shooting. Special attention is paid to government and parastatal relationships. A business development forum was formed to identify further key accounts, harness McCarthy divisional synergies and help McCarthy benefit from 2010 opportunities.

ElianceWe develop business improvement solutions, with specific emphasis on customer management software and its integration into internet, mobile and e-mail marketing initiatives. Toyota SA has bought our “Automotive” product suite and its full implementation across Toyota’s dealer network will take more than a year. Increased investment in facilities and infrastructure will enable faster deployment of software solutions via new state-of-the-art telephony services and computers. Acquisition of international customers will be a focus area in 2008.


Proudly Bidvest people are inspired to create business value


Summarised sustainability report

Sustainability at Bidvest is about

being Proudly Bidvest and presents

the opportunity to provide employees

with a fresh way of thinking that not

only inspires them, but also enables

a new generation of entrepreneurs to

create business value that addresses

and where possible exceeds evolving

societal needs and expectations.

> Refinancing of Dinatla’s investment, cementing the empowerment partnership for a further five years

> Review and full upgrade of Group communications capacity

> BEE procurement R4,6 billion (16,7% of discretionary South African spend)

> Direct employment: 10 859 jobs created

> Women employees – 44,8% (women employees in South Africa – 49,1%)

> Total training spend R141,1 million (R118,1 million in South Africa)

> Bidvest is one of only three South African companies listed in the Dow Jones Sustainability World Index 2007 and the JSE has reaffirmed Bidvest as a founding constituent of the SRI Index

> Corporate social investment spend increased to R38,5 million, equating to 1,0% of pre-tax profit (R32,2 million and 1,2% of pre-tax profit in South Africa)

Disappointments> Five work-related fatalities

Challenges> Developing a sustainability strategy and

management framework> Empowering employees to create social and “green”

business opportunities > Establishing more effective programmes for

managing HIV/Aids in the workplace based on recently conducted group-wide research

> Attracting and retaining senior-level HDIs > Addressing general skills shortages > Establishing performance tracking of socio-

economic transformation at provincial level > Improving the collation, management and usability

of reporting data throughout the Group > Ensuring continued compliance with intensifying

environmental regulations

This is the fourth year that Bidvest is reporting on its sustainability performance. The Group is pleased with the progress it is making in promoting sustainable development. As an entrepreneurial multi-national with more than 104 000 employees, Bidvest is well positioned to take a leading role in integrating business, society and the environment.

Bidvest remains a multi-faceted and decentralised operation, encouraging individual businesses to develop within a framework of common values and codes of conduct and ethics. The Group has revisited, further developed its understanding of what sustainability means to the Group, without restricting individual divisions in applying its meaning to their unique context.

Sustainability at Bidvest is about being Proudly Bidvest and presents the opportunity to provide employees with a fresh way of thinking that not only inspires them, but also enables a new generation of entrepreneurs to create business value that addresses and where possible exceeds evolving societal needs and circumstances.

Improved communications have helped increase levels of consciousness and commitment to sustainability. In South Africa, an emphasis is placed on advancing socio-economic transformation. A younger generation of leaders who are HDIs is emerging through the Bidvest Academy and Graduate Academy and


assuming positions of significant responsibility. The Graduate Academy includes a divisional project to identify “green” business opportunities.

In the South African operations, improving response strategies to the HIV/Aids epidemic is another focus.

The standardisation of environmental data and the data collation process has improved and environmental data is reported for the first time for some South African divisions. Some businesses are being proactive in improving their environmental performance. A leading example in South Africa is Voltex which works in association with national electricity utility Eskom to promote demand-side management across industry and commerce. Bidvest strives towards a more energising and proactive approach within a decentralised context. A comprehensive account of the Group’s non-financial performance, including divisional reviews, is provided in the 2007 Sustainability report . The sustainability report follows the Global Reporting Initiative’s G3 guidelines.

MANAGING SUSTAINABLE DEVELOPMENTSustainable development is an integral part of Bidvest doing business. It is about return on funds employed, sound business practices, risk management, good governance, taking account of stakeholder needs, stewardship of natural resources, BEE and developing employees, an ongoing process of learning and a source of innovation and new business opportunities.

Bidvest is a geographically and multi-faceted business operating on four continents. The majority of the Group’s activities are in South Africa, where 84,3% of its workforce is based. Divisions function independently and on a decentralised basis, managing sustainability objectives and priorities according to their material issues, yet derive benefits from being part of a larger group.

Bidvest provides guidelines for financial management, corporate governance, sustainability reporting and transformation. Executive management take responsibility with support from audit and risk committees. A standalone risk committee reporting directly to the board has been established. Business units monitor and manage day-to-day performance.



SOCIOECONOMIC TRANSFORMATION IN SOUTH AFRICABidvest is making consistent progress in promoting black economic empowerment and driving socio-economic transformation throughout the South African businesses. The majority of Bidvest’s activities and workforce are in South Africa, where socio-economic transformation and BEE are an integral part of creating sustainable businesses and communities. By virtue of its size and diversification across numerous industries, Bidvest is making a far-reaching contribution to the communities in which it operates and in providing employment Bidvest’s empowerment partners in the Dinatla consortium play an important role in these achievements as do our commercial directors who drive the process on the ground.

Bidvest, a level five contributor with an unconstrained operational capacity, has a “BBB” empowerment rating from Empowerdex. The “BBB” rating relative to our “A” rating achieved previously is largely due to the changes in the codes of good practice.

The finalised codes of good practice announced by the South African government early in 2007, will bring much needed clarity to the process and will facilitate further transformation.

Bidvest is one of only 11 winners of the inaugural Community Growth Funds Unity Awards, backed by major trade unions, reinforcing its credentials as an empowered, socially responsible employer.

Effective empowerment holdingsBidvest has a significant empowerment shareholding. Economic BEE ownership calculated in terms of the codes is 26,7% effective BEE control, thereby giving the Group the maximum points on the generic scorecard. The Dinatla BEE consortium owns 8,9%.

Bidvest’s empowerment partners in the Dinatla consortium play an important role in Bidvest’s transformation achievements. The Bidvest facilitated refinancing of the Dinatla investment has cemented this collaborative and mutually beneficial partnership for a further five years.

Managing transformationBidvest’s well-structured and entrenched approach enables it to confidently advance along an ambitious path of transformation. The Group’s transformation committee is responsible for driving socio-

Workshops have been held with divisional chief executives and members of their management team to help foster a growing appreciation of the complexities of sustainable development and to enhance their interpretation of what it means to their businesses.

The Bidvest ethics line was re-launched in February 2007 with an extensive marketing campaign to promote this “whistle blowing” mechanism for staff, customers and suppliers.

Given the Group’s unique structure and culture, the implications of sustainability in one business division may be very different from those in another. Bidvest continues to explore and contextualise what sustainable development means for the Group and how best to manage it.

Management systemsBusiness units have implemented or are working on implementing formal management systems where deemed to be of material benefit. In most cases these are generic management system standards for quality (ISO 9000) and environmental (ISO 14000) management, which are independent of product or industry and provide an authoritative indication of how quality, social and environmental activities are managed.

Formal or informal management systems are usually present in business units that deal with hazardous products, have hazardous working environments or where quality is of particular importance.

ECONOMIC IMPACTBidvest provides employment to 104 184 people and economic benefits to far more. The Group has produced consistent returns for shareholders throughout its 19 years of operation. Results reflect good organic growth and a focus on operational efficiencies.

Bidvest achieved revenues of R95,7 billion (2006: R77,3 billion), trading profit of R4,5 billion (2006: R3,7 billion) and headline earnings reached R2,9 billion (2006: R2,4 billion). R17,0 billion of wealth was created and R10,0 billion (58,6%) distributed to employees and R1,0 billion (5,9%) to government. Total exchanges with government including amounts collected on their behalf amounted to R18,7 billion. Foreign operations contributed 43,5% to Group revenue and 28,7% to trading profit.


Employment equity and skills developmentBidvest’s emphasis on investment in the skills and leadership development of HDIs and women is increasingly bearing fruit, with greater representation across management, technical and professional categories. A number of divisions appointed HDIs to senior levels, yet retention remains an ongoing challenge in view of the industry-wide skills shortages.

Integrated employment equity and skills development programmes with targets for black representation at all levels are rolled out across the divisions and at each business unit. Succession planning strategies are implemented to ensure the movement of black candidates into management positions and retention strategies and mentorship programmes for black employees are in place.

Annual training spend in South Africa increased to R118,1 million (2006: R83,0 million).

Indirect empowerment: preferential procurement and enterprise developmentOperations are committed to pursuing policies that promote the use of black-owned and empowered enterprises. Preferential procurement has increased, as more suppliers become empowered and more opportunities are identified. Bidvest spent 16,7% of total procurement, excluding monopolistic suppliers and foreign spend, on external BEE suppliers of goods and services.

Given the timing of the release of the codes and the collection and collation of procurement data, there is an interim transitional period where suppliers will still be rated under the old codes, leading to a significant degree of under-reporting of our preferential procurement spend.

Business units use an electronic supplier database which serves as a consistent point of reference for supplier empowerment credentials, facilitating the identification of opportunities for business units and suppliers to work together.

Bidvest increased its investment in enterprise development. Promoting enterprise development involves engaging with financial institutions to negotiate favourable financing terms for small BEE suppliers, providing BEE suppliers with favourable credit and payment terms, and offering mentorship

economic transformation within the Group. Bidvest’s transformation strategy focuses on progressing skills development and employment equity at all levels, increasing levels of procurement of goods and services from HDIs and promoting the development of small, micro and medium-sized black owned enterprises.

Business units subscribe to the Bidvest Charter and BEE scorecard, which guide the Group’s transformation strategy, as systems to measure and monitor BEE performance. These have been aligned with the revised methodology prescribed in the codes. The codes are more prescriptive than the previous generic scorecard and place more emphasis on the need to appoint, employ, promote and develop black women in the workplace. The latest audit indicates that practices are on track and a few discrepancies had to be addressed to meet the regulatory requirements.

The codes provide a framework for the regulation of BEE verification agencies. The provision of this regulatory framework requires that all verification agencies be accredited by the independent accreditation body South African National Accreditation System. This will resolve previously problematic inconsistencies in the assessment of companies’ empowerment status.

Transformation is the responsibility of each business unit and every Bidvest subsidiary will be required to obtain individual empowerment ratings. Business units have held workshops for staff to ensure familiarity and comprehension of the codes and revised Bidvest Charter and scorecard.

An electronic system has been developed to enhance the process of collating scorecard data and ensure the highest standards. The data is confirmed annually by third-party assurance providers and the scores are determined and verified by an independent empowerment rating agency.

The Bidvest intranet provides an effective resource for improving levels of BEE awareness, understanding and knowledge among employees.

Bidvest is refining its measuring of socio-economic transformation with a major drive to track performance across all aspects of the scorecard, at a provincial level.



Health and safetyBidvest is dedicated to meeting relevant occupational health and safety standards, as well as sound global best practices. Operations are compliant with relevant occupational health and safety legislation and regulations. Business units have designated personnel and systems in place to monitor and manage health and safety standards. Business units which involve a hazardous working environment have formal systems to ensure that the strictest health and safety standards are enforced. Business units are required to identify health and safety risks in the workplace and take steps to eliminate or mitigate risks by implementing the necessary controls. Training and maintaining an awareness of risks and precautions are an important part of this process.

It is with regret that Bidvest reports the death of five employees while on duty. Full investigations are conducted of fatal incidents and adaptations to the health and safety processes are made where necessary.

The injury rate for Bidvest was 4,7 and the lost day rate was 10,3. Definitions relating to occupational health and safety are in line with the GRI’s G3 guidelines and its technical protocols.

HIV/AidsThe HIV/Aids epidemic is a significant challenge affecting most Bidvest companies in southern Africa. A Group HIV/Aids policy serves to guide businesses in developing appropriate programmes. Bidvest companies are proactively tackling the epidemic, often in cooperation with unions. While a number of businesses are making progress and several have outstanding HIV/Aids programmes, many businesses still need to improve their response strategies.

An HIV actuarial prevalence study was conducted by an outside specialist as an initial step towards quantifying the impact of HIV/Aids on the Group along with an assessment of the HIV/Aids programmes in place throughout the Group. HIV prevalence rate is 17,3%, which is an average and, given Bidvest’s diversity, cannot be applied to any one business unit in isolation. Bidvest is considering how best to enhance existing programmes and assist in the development of a co-ordinated HIV/Aids strategy for the Group. But the basis remains decentralised.

and advice to small BEE suppliers to ensure effective skills transfer and sustainability. An assessment of enterprise development at a provincial level is in progress with the aim of managing initiatives at a provincial level in the future, to encourage more co-ordinated and targeted efforts.

WORKFORCEBidvest employs 104 184 people, 87 833 in South Africa, the majority of whom are HDIs (86,2%). Businesses comply with statutory requirements: the South African Labour Relations, the Basic Conditions of Employment, the Skills Development, the Employment Equity, the Broad-based Black Economic Empowerment, Unemployment Insurance and the Occupational Health and Safety Acts, or their equivalents in other countries. Business codes, policies and procedures typically cover recruitment and selection, business conduct, non-discrimination, industrial relations, employment equity, grievance and dispute settlement, HIV/Aids and other life threatening diseases, employee conduct, freedom of association, ethics and sexual harassment. Many of these were negotiated and agreed with unions. Companies have formal grievance procedures in place, which in South Africa are in accordance with Schedule 8 of the Labour Relations Act.

Many businesses have structured employee development programmes and related performance appraisal systems in place and a growing number of businesses conduct formal employee satisfaction surveys.

Bidvest has been nominated by a panel of experts as one of the top 10 companies to work for in South Africa in research undertaken by the Corporate Research Foundation.

CommunicationsA review of communications throughout the Group has revealed significant opportunities to improve physical and electronic communications with employees worldwide. Developments include an improved database of employee information, the merger of the Bidvest website and intranet and an upgraded staff publication, Bidvoice, which includes sustainability related issues. The Proudly Bidvest positioning has been well received by staff, businesses, customers and suppliers. Bidvest is known for turning the ordinary into the extraordinary and that theme will be built on in our communications.


clients on a regular basis and real time feedback is used to enhance service delivery. A number of businesses formally log customer feedback and subsequent actions, often as part of a quality management system such as ISO 9000.

Community activitiesResponsibility for corporate social investment activities resides with Bidvest divisions and their business units, most of which support a variety of initiatives. Bidvest CSI covers: education and training, health and HIV/Aids, community development, sports, arts and culture, environmental initiatives, economic empowerment and job creation, safety and security and welfare.

Group CSI spend increased to R38,5 million (2006: R28,7 million), which equates to 1,0% of pre-tax profit. The South African operations spent R32,2 million, which equates to 1,2% of profit before tax.

ENVIRONMENTAL PERFORMANCEBidvest is a services, trading and distribution business which has a variety of environmental impacts. The JSE SRI Index has classified Bidvest as a business with a “medium” environmental impact. As a minimum, businesses ensure compliance with applicable environmental legislation and in many cases, through the use of newest technologies and best practices, go beyond compliance.

A Group environmental policy, which encourages businesses to take a more proactive stance to the environment as a sustainability issue has been developed. A number of businesses have moved beyond compliance to adopting voluntary standards for indirect impacts relevant to their industry sector. United Kingdom-based 3663 stands out as a leader in the Group with its proactive stance towards the environment and its innovative environmental projects.

The standardisation of data and the data collation process has improved and environmental data is reported for the first time for some South African divisions. In a group as diverse and decentralised as Bidvest, ongoing work is required to streamline the collation, management and usability of sustainability data and to ensure management takes ownership of information, to guide appropriate actions. Plans are in place for online gathering of sustainability data.

Bidvest is a member of SABCOHA, the South African Business Coalition on HIV/Aids.

TrainingEmployee development is a vital aspect of maintaining a motivated, competent workforce, especially given South Africa’s shortage of skilled labour. Training and development is the responsibility of senior management and programmes are structured according to business and employee needs.

Divisions budget a minimum 1,0% of gross total payroll for skills development programmes. In South African operations, a learning programme matrix has been introduced to ensure alignment with Department of Labour criteria and the Skills Development Act. The programme ensures that skills spend initiatives have clear learning outcomes and focuses on occupation-directed and work-based learning.

An amount of R1 354 was spent on training per employee, up from R1 092 in 2006. Education and training opportunities include staff education bursaries, adult basic education and training programmes and learnerships in South Africa, and specific technical and industry-related skills training.

In South Africa, an emphasis is placed on executive leadership development. The Bidvest Academy offers leadership and business training through practical interventions and exposure to the Group, its businesses and executives. The Graduate Academy, offered to graduates of the academy who have had several more years’ experience in the field and show continued promise, focuses on issues perceived as being of key importance to the businesses – negotiation, diversity training, marketing and new business opportunities including a divisional project to identify “green” business opportunities.

A sales orientation and sales management development programme has been rolled out to Bidfood businesses and has been offered to other divisions.

COMMUNITYCustomersBidvest interacts with a broad range of corporate and private customers. While a number of businesses conduct formal customer satisfaction surveys, most interact personally with their predominantly corporate


Corporate governance

Introduction

Corporate governance entails the accountable and

transparent governance of the Group’s structures and

systems within an ethical framework that will promote

responsible consideration of all stakeholders.

The board and the individual directors have long

recognised that good corporate governance is

compatible with and mutually dependent on strong

leadership. The board is committed to conforming

to good corporate governance processes that will

complement Bidvest’s entrepreneurial flair. This

commitment involves leading the enterprise with

integrity and in compliance with international

practices, whilst taking cognisance of the value systems

of the countries and communities in which it operates.

The decentralised, entrepreneurial and incentivised

environment in which the Group operates called for

governance processes to be considered, implemented

and embedded into the Group structure, through

the introduction of the Group governance policy.

This serves to guide all operations within the Group

in applying corporate governance practices at their

respective levels within the Group.

Corporate code of conduct

The board, its committees, individual directors, officers

of the Group and senior management acknowledge

their responsibility to ensure that the principles set out

in the code of conduct are observed.

Bidvest, through its corporate code of conduct, is

committed to:

> the highest standards of integrity and behaviour in

all dealings with stakeholders and society-at-large;

> conducting business based on fair commercial

competitive practices;

> trading with customers and suppliers who

subscribe to ethical business practices;

> non-discriminatory employment practices and the

promotion of employees to realise their potential

through training and development of their skills;

and

> being proactive towards environmental, social and

sustainability issues.

Code of ethics

The Group has adopted a code of ethics that ensures

business practices are conducted in a manner that

is beyond reproach. The code of ethics is promoted

across the Group and clearly states the acceptability of

business practices by guiding policy and providing a

set of ethical corporate standards that will encourage

ethical behaviour and decision making of the board,

managers and employees at all levels.

The code will guide and sensitise ethical

infringements, whilst specifying the enterprise’s social

responsibility towards stakeholders.

The board has been proactive in identifying the

following aspects and has pursued a process in each

division for the:

> regular and formal identification of ethical risk areas;

> development and strengthening of monitoring and

compliance policies, procedures and systems;

> establishment of easily accessible, safe reporting

(whistle blowing) channels;

> alignment of the Group’s disciplinary code with its

code of ethical practice;

> integrity assessment as part of selection and

promotion procedures;

> induction of new appointees;

> training on ethical principles, standards and

decision making;

> regular monitoring of compliance with ethical

principles and standards using the internal audit

function;

> reporting to stakeholders on compliance; and

> independent verification of conformance to

established principles and ethical behaviour.

Corporate style, values and ethics

Bidvest’s corporate value system promotes:

> Accountability to our employees and shareholders

> Acquisitiveness to expand and grow the business


> Decentralisation to put decision making close to

the customer

> Entrepreneurship to find innovative ways to grow

the business

> Equal opportunity to perform and be rewarded

> Fairness in our interactions with stakeholders

> Honesty in all our dealings with our stakeholders

> Innovative in our business practices

> Respect for human dignity, human rights and social

justice for the dignity and rights of people and for

the environment

> Service excellence to provide a compelling place to

work and do business

> Transparency in maintaining open lines of

communications with our stakeholders

THE BOARD OF DIRECTORS

Bidvest is a unique company, which is reflected in

the composition and size of its board. The board

comprises six non-executive independent directors,

six non-executive, eleven executive and one alternate

director.

MC Ramaphosa conducted the role of non-executive

chairman and B Joffe, chief executive.

The completely decentralised decision-making

structure, the independence and the character

of the individual board members provide for

open and transparent governance. Successful

entrepreneurial individuals, whose recognition and

ongoing participation in Bidvest is vital, manage

the decentralised business units. In addition to the

divisional chief executives, key operating executives

responsible for significant operations are included on

the board.

Gill Marcus and Bernadette Moffat have resigned

from the board. Tania Slabbert has become a full

director. A long-standing executive member of the

board – Colin Kretzmann – has retired. David Cleasby,

Peter Nyman’s successor as financial director has

become a full director. Peter Nyman remains an

executive director responsible for special projects. The

board expresses its thanks to the outgoing directors

for their contributions.

While the executive directors are responsible for

implementing strategies and operational decisions

within the Group’s businesses, the non-executive

directors are viewed as independent by the board

and support the skills and experience of the executive

directors. Their role is to bring judgement to bear,

independent of management, on issues of strategy,

budgets, performance, resources, transformation,

diversity, employment equity, standards of conduct

and evaluation of performance, while contributing

to the formulation of policy and decision making

through, inter alia, their knowledge and experience.

The board gives strategic direction to the Group,

appoints the chief executive and the non-executive

chairman and ensures that succession is planned.

The non-executive directors ensure that the chair

encourages proper deliberation of all matters requiring

the board’s attention.

Functions of the board

The board charter sets out clear direction with regard

to the purpose of the board, responsibilities of board

members, composition and requirements for board

meetings. The board charter also calls for an annual

self-assessment applicable to the chief executive

and the individual directors. The board is ultimately

responsible for ensuring that the business remains a

going concern and that it thrives. The board retains

full and effective control over the Group and monitors

risk management and implementation of plans and

strategies through a structured approach to reporting

and accountability.

The board is committed to an appropriate balance of

power and authority to ensure that no one individual

or group of individuals can dominate the board’s

decision-making process.



The board met five times during the period and

has a formal schedule of matters reserved to it as

recorded in the board charter, directors’ report

for attendance register. The board has developed a

formal corporate governance manual which, inter

alia, includes a corporate code of conduct and board

committee charters.

Board committee charters define the purposes,

authority and responsibility of the various board

committees and have been developed for the:

> board of directors;

> executive committee;

> audit committee;

> nomination committee;

> remuneration committee;

> acquisition committee; and

> risk committee.

The divisional boards have adopted the governance

manual, where applicable. The process to entrench the

corporate governance manual and the principles of

good corporate practice and governance throughout

the Group has been implemented under the auspices

of the audit committee.

The purpose, objectives and responsibility of the

transformation committee are defined in the Bidvest

Charter.

The board and its committees are supplied with

complete, relevant and timeous information, enabling

them to fulfil their responsibilities. Directors have

unrestricted access to Group information, records,

documents and property. Non-executive directors

have access to, and are encouraged to meet with,

management. The information needs of the board

are well defined and regularly monitored. All directors

have access to the advice and services of the Group

secretariat and there is an agreed procedure by

which directors may obtain independent professional

advice at the Group’s expense, should they deem this

necessary.

The Group has adopted a formal policy, in line with

the Insider Trading Act, that prohibits directors,

officers and other selected employees in dealing

with securities for a designated period preceding the

announcement of its financial results or in any other

period considered sensitive.

The board defines levels of materiality, reserving

specific power and delegating other matters with the

necessary written authority to management. These

matters are monitored and evaluated on a regular

basis. The board has developed a formal delegation of

authority matrix guideline, which is being utilised by

all Group companies.

Formal and transparent appointment procedures

are in place and the board is assisted by the

nomination committee. Periodically, directors visit the

Group’s businesses and have meetings with senior

management to facilitate their understanding of the

Group and their fiduciary responsibilities.

The board is cognisant of the duties imposed on the

company secretary who is accordingly empowered to

properly fulfil those duties. In addition to the extensive

statutory duties, the company secretariat provides

the board and directors individually with detailed

guidance as to how their responsibilities should

be properly discharged in the best interests of the

Group. The company secretariat is the central source

of information relative to guidance and advice to the

board, and within the Group, on matters of ethics and

good governance.

The board ensures that the Group complies

with all relevant laws, regulations and codes of

business practice and that it communicates with

its shareholders and relevant internal and external

stakeholders openly, promptly and with substance

prevailing over form.

The board identifies the key risk areas and key

performance indicators for the Group, which are


regularly updated. The entrepreneurial culture of the

Group requires thorough risk control processes that

identify and mitigate risks and ensure that the Group’s

objectives are attained. This control environment

sets the tone for the Group and covers, inter alia,

ethical values, management’s philosophy and the

competence of employees. In general, risk areas

confronting the Group are:

> currency and economic volatility;

> HIV/Aids in Africa;

> human capital or “people risk” mitigated through

intensive skills development programmes; and

> market risk caused by fluctuations in demand and

competitive activity.

The most fundamental mechanism for managing

these risks is the diversified Bidvest business model

that makes “owner-managers” accountable for all

aspects of performance.

Through the audit committee, the board regularly

reviews processes and procedures to ensure the

effectiveness of internal systems of control so that its

decision-making capability and the accuracy of its

reporting are maintained at a high level. The board

identifies and monitors the non-financial aspects

relevant to the business of the Group and reviews

appropriate non-financial information that goes

beyond assessing the financial and quantitative

performance of the Group. Other qualitative

performance factors, which take into account broader

stakeholder issues, are considered.

Board committees

The board has established a number of committees

which are responsible to the board. Specific

responsibilities have been formally delegated to these

committees with clearly defined terms of reference, in

respect of duration and function, reporting procedures

and written scope of authority, documented in a

formal charter. There is transparency and full disclosure

from the board committees to the board. Board

committees are free to take independent outside

professional advice, as and when necessary, and are

subject to regular evaluation by the board to ascertain

their performance and effectiveness. The principal

board committees are:

Group executive committee

The Group executive committee consists of the chief

executive, the Group financial director, the divisional

chief executives, LI Jacobs and AC Salomon. The

executive committee considers and refers major

decisions, which have their sanction, to the board for

approval. Non-executive directors are invited to attend

these meetings.

South African executive committee

The South African executive committee consists of

the chief executive (chairman), the Group financial

director, the divisional chief executives, LI Jacobs,

L Madikizela, SG Mahalela, P Nyman, AC Salomon and

SA Thwala. The committee considers and refers major

decisions, specifically related to the South African

operations, to the board for approval.

Remuneration committee

The remuneration committee consists of DDB Band

(chairman), DE Cleasby, D Masson, P Nyman and

JL Pamensky. The committee is responsible for

the performance assessment and approval of a

remuneration strategy for the board directors,

including the chairman, chief executive and divisional

executives, in consultation with the chief executive.

The executive directors, who are members of the

remuneration committee, are excluded from the

review of their own remuneration.

The remuneration committee’s overall strategy is

to ensure that employees are rewarded for their

contribution to the Group’s operating and financial

performance, by taking into account industry, market

and country benchmarks. In order to promote an

identity of interests with shareholders, share incentives

are considered to be critical elements of executive

incentive pay. Schedules setting out directors’



remuneration and equity interests appear in the

directors’ report.

Audit committee

An audit committee was established in 1995 and

is an important element of the board’s system of

monitoring internal controls. The members of the

committee are NG Payne (chairman), DDB Band,

DE Cleasby, RW Graham, D Masson, P Nyman,

JL Pamensky and AC Salomon. The committee meets

at least four times a year and the Group internal audit

manager and external auditors are invited to attend

every meeting. Other members of the management

team attend, as required.

The audit committee charter defines and guides

the audit committee with adequate reference to

its purpose, membership, authority and duties. The

committee is responsible for reviewing the interim

and final financial statements and assesses whether

these are appropriate to meet the current and future

needs of the business. Their duties further include

assessing whether significant business, statutory and

financial risks have been identified and are being

monitored and managed through internal financial

control procedures, and that appropriate standards of

accounting, governance, reporting and compliance

are in operation.

The audit committee has a responsibility to

recommend to the board, for its consideration and

acceptance by shareholders, the appointment of

external auditors. The audit committee also sets

out the principles for the performance of non-audit

services by the external auditors. The audit committee

reviews divisional audit committee reports.

Each division has its own audit committee, which

subscribes to the same Group audit philosophies and

reports to both the divisional board and the Group

audit committee. Each divisional audit committee has

at least one member who is a non-executive to the

division. A non-executive chairs the committee where

appropriate.

Risk committee

A charter for the risk committee was finalised and

the committee is now self-standing. The members

of the risk committee are NG Payne (chairman) the

chief executive, the South African divisional chief

executives, the Group financial director, D Masson and

AC Salomon.

Acquisition committee

Acquisitions with perceived potential conflicts

are referred to the acquisition committee for an

in-principle decision as to whether the acquisition

should be investigated and pursued. This committee

consists of DDB Band (chairman), MC Berzack,

DE Cleasby, B Joffe, D Masson, JL Pamensky and

LP Ralphs. Acquisitions are, depending on their

magnitude, sanctioned by the executive committee

and submitted to the board for approval.

Nomination committee

The nomination committee constitutes a majority

of non-executive directors so as to ensure its

independence and objectivity. The committee

comprises DDB Band (chairman), B Joffe, JL Pamensky,

MC Ramaphosa and T Slabbert.

The primary purpose of the committee, as set out in

the nomination committee charter, is to ensure that

the procedures for the appointments to the board are

formal and transparent. The committee considers the

composition of the board, retirements, appointments

of additional and replacement directors and makes

appropriate recommendations to the board.

Executive directors are appointed to the board on the

basis of skill, experience and level of contribution to

the Group and are responsible for the running of their

businesses. Non-executive directors are selected on

the basis of industry knowledge, professional skills and

experience.


The committee is responsible for ensuring that

nominees are not disqualified from being directors

and, prior to their appointment, investigate their

backgrounds in line with the requirements for listed

companies set by the JSE.

Executive and non-executive directors retire by

staggered rotation and stand for re-election at least

every three years in accordance with the articles of

association. The re-appointment of non-executive

directors is not automatic. Directors are subject to

re-election by shareholders and sufficient biographical

information is provided to shareholders enabling an

informed decision.

The committee annually reviews the board’s required

mix of skills and experience and other qualities such

as its demographics and diversity in order to assess

the effectiveness of the board, its committees and the

contribution of each director.

Transformation committee

Following the successful implementation of the

Dinatla initiative, a transformation committee was

formed to facilitate the socio-economic transformation

process within the Group. Key functional resources

were designated within each business unit to

continue the socio-economic transformation drive at

business unit level. The transformation committee has

developed an enterprise-based charter, the Bidvest

Charter, that guides the Bidvest BEE transformation

strategy.

The transformation committee comprises LI Jacobs

(chairman), MC Berzack, NW Birch, AW Dawe,

MJ Finger, B Joffe, SG Mahlalela, SG Pretorius,

LP Ralphs, T Slabbert, SA Thwala and FDP Tlakula.

ACCOUNTABILITY

Going concern

The directors endorse and are of the opinion that

the Group has sufficient resources to maintain the

business for the future. Consequently, the going-

concern basis for preparing the financial statements is

adopted.

The board minutes the facts and assumptions

used in the assessment of the going-concern

status of the Group at the financial year end. At

the interim reporting stage, the directors consider

their assessment at the previous year end of the

Group’s ability to continue as a going concern and

determine whether any of the significant factors in the

assessment have changed to such an extent that the

appropriateness of the going-concern assumption at

the interim reporting stage has been affected.

Auditing and accounting

The board is of the opinion that their auditors observe

the highest level of business and professional ethics

and that their independence is maintained.

The Group aims for efficient audit processes using

its external auditors in combination with the internal

audit function. Management encourages unrestricted

consultation between external and internal auditors

resulting in periodic meetings to discuss matters of

mutual interest, the exchange of working papers and

management letters and reports, and a common

understanding of audit techniques, methods and

terminology.

Internal financial controls

The directors are responsible for adequate internal

control systems that will provide reasonable assurance

regarding the safeguarding of assets and the

prevention of their unauthorised use or disposition,

the maintenance of proper accounting records and

the reliability of financial and operational information

used in the businesses.

The system of internal control is designed to manage,

rather than eliminate, the risk of failure to achieve

business objectives and can provide reasonable, not

absolute, assurance against material misstatement

or loss. There is an ongoing process for identifying,



evaluating, managing, monitoring and reporting on

significant risks faced by the Group.

The Group’s system of internal financial control

includes policies and procedures, clearly defined lines

of accountability and delegation of authority, and

makes provision for comprehensive reporting and

analysis against approved standards and budgets.

Compliance is tested by way of management review,

internal audit check and external audit. The Group’s

various divisional audit committees consider the

results of these reviews on a regular basis and confirm

the appropriateness and satisfactory nature of these

systems, while ensuring that breakdowns involving

material loss, if any, together with remedial actions,

have been reported to the respective boards of

directors.

Internal audit function

The internal audit departments are independent

appraisal functions, whose primary mandate is

to examine and evaluate the effectiveness of the

applicable operational activities and the attendant

business risks. The internal audit function includes

the examination of the systems of internal financial

control, so as to bring material deficiencies, instances

of non-compliance and development needs to the

attention of the audit committee, external auditors

and operational management for resolution.

Internal audit is an independent and objective

assurance and consulting activity designed to add

value to and improve the Group’s operations. Internal

audit undertakes a continual function in measuring,

evaluating and reporting on the effectiveness of

risk, control, governance systems and processes. It

considers their economy of application and efficiency

in meeting the objectives of the organisation using a

systematic, disciplined approach. Internal audit further

provides:

> assurance that the management processes are

adequate to identify and monitor significant risks;

> confirmation of the adequacy and effective

operation of the established internal control

systems;

> credible processes for feedback on risk

management and assurance; and

> objective confirmation that the board receives

the appropriate quality of assurance and reliable

information from management.

The purpose, authority and responsibility of the

internal audit function is formally defined in an

internal audit charter, which has been approved by

the board and which is consistent with the Institute

of Internal Auditors’ definition of internal auditing.

Divisional internal audit committees have their own

internal audit function that ensures that the necessary

controls are in place for effective risk management

and monitoring.

The activities of the divisional internal auditors are

co-ordinated by the Group internal audit manager

based at the corporate office, who has unrestricted

access to the audit committee and its chairman. The

Group internal audit manager reports at all audit

committee meetings and attends divisional audit

committee meetings.

The internal audit function communicates with

other internal and external auditors to ensure proper

coverage and to minimise duplication of effort. The

external auditors also review reports issued by internal

audit.

The audit committee is satisfied that adequate,

objective internal audit assurance standards and

procedures exist within the Group. At committee

meetings internal audit reports on the major business

units are reviewed, together with proposals for the

ongoing internal assurance processes. The adequacy

and capability of the Group’s internal audit structures

are subject to review annually.

Audit plans for each business segment are tabled

annually to take account of changing business needs.


Follow-up audits are conducted in areas where major

weaknesses are identified.

The internal audit plan, approved by the audit

committee, is based on risk assessment, which is of

an ongoing nature in an attempt to identify not only

existing and residual risks, but also emerging risks, as

well as issues highlighted by the audit committee and

senior management. Self-assessment questionnaires

are completed on a regular basis by several divisions.

Internal audits are conducted formally at each

business unit at least once in a two-year cycle. This

risk assessment is coordinated with the board’s own

assessment of risk.

Where the external auditors also perform the internal

audit function, due care is taken to ensure that there

is adequate segregation between the two functions in

order to ensure that their independence is not impaired.

Risk management

The board is responsible for the total process of

risk management. It sets the risk strategy, which is

based on the need to identify, assess, manage and

monitor all known forms of risk across the Group. Risk

management is conducted after consulting with the

executive directors and senior management.

Management is accountable to the board for

designing, implementing and monitoring the

processes of risk management and integrating them

into the day-to-day activities of the Group. The risk

aversion philosophy is communicated to all managers

and employees in an endeavour to incorporate this

philosophy into the language and culture of the

Group. Risk management and internal control are

practised throughout the Group and are embedded in

day-to-day activities.

The risk committee attests that there are adequate

systems of internal control in place to mitigate the

significant risks faced by the Group to an acceptable

level. The systems are designed to manage, rather

than eliminate, the risk of failure or to maximise

opportunities to achieve business objectives. Risk is

not only viewed from a negative perspective. The

review process also identifies areas of opportunity,

such as where effective risk management can be

turned to a competitive advantage.

The management of risk and loss control is

decentralised, but in compliance with Group policies

on risk financing and self-insurance. Compliance

measurement is conducted through the review of

periodic risk activity reports including measurement

of identified losses. The decentralised structure and

geographic spread ensures that the overall Group risk

is balanced and minimised.

At operational level, senior management identifies

major business risks, promotes awareness, introduces

applicable control environments and procedures and

applies risk-monitoring techniques. The divisional risk

committees identify the manner and extent to which

risk is controlled and/or reduced, while monitoring the

process.

Bidvest’s decentralised structure forms the basis of

the Group’s business continuity plan with each of

the operations being self-sufficient with regard to

disaster recovery and management succession plans.

The individual business units are sufficiently small and

independent of each other to eliminate Group-wide

disaster risk.

In addition to the Group’s other compliance and

enforcement activities, the board recognises the need

for a confidential reporting process (“whistle blowing”)

covering fraud and other risks. The whistle-blowing

reporting procedures and 24-hour call centre ensure

formal reporting and feedback.

While operating risk can never be fully eliminated,

the Group endeavours to minimise it by ensuring

that the appropriate infrastructure, controls, systems

and human resources are in place throughout the

businesses. Key policies employed in managing

operating risk involve the segregation of duties,

transaction authorisation, monitoring and financial

and managerial reporting.

The effectiveness of the internal control systems,

including the potential impact of changes in the

operating and business environments, is monitored

through regular management reviews (with

representation letters on compliance signed annually

by the chief executive and chief financial officer of

each major business unit), testing by internal auditors

and testing of certain aspects of internal financial

control systems by the external auditors during the

course of their statutory examinations. Directors

make annual written declarations of interests and are

obliged to report any potential or actual conflicts.

RELATIONSHIPS WITH SHAREHOLDERS

The Group pursues dialogue with institutional

investors based on constructive engagement and the

mutual understanding of objectives, having regard to

statutory, regulatory and other directives regulating

the dissemination of information by companies and

their directors. To achieve this dialogue there have

been a number of presentations to, and meetings

with, investors and analysts to communicate the

strategy and performance of the Group. The quality

of this information is based on the standards of

promptness, relevance and transparency. The Group

makes every effort to ensure that information is

distributed via a broad range of communication

channels, including the internet, having regard for

security and integrity while bearing in mind the

need that critical financial information reaches all

shareholders simultaneously.


The board accepts its duty to present a balanced and

understandable assessment of the Group’s position

in reporting to stakeholders, taking into account

the circumstances of the communities in which it

operates and the greater demands for transparency

and accountability regarding non-financial matters.

Reports address material matters of significant

interest and concern to all stakeholders and present

a comprehensive and objective assessment of the

Group so that all stakeholders with a legitimate

interest in the Group’s affairs can obtain a full, fair and

honest account of its performance.


Financial statements

Value added statement 126

Exchanges with government 126

Directors’ responsibility for the financial statements 127

Declaration by company secretary 127

Independent auditors’ report 128

Directors’ report 129

Accounting policies 135

Consolidated income statement 144

Consolidated statement of recognised income and expenses 145

Consolidated cash flow statement 146

Consolidated balance sheet 147

Notes to the consolidated financial statements 148

Company income statement 182

Company cash flow statement 182

Company balance sheet 183

Notes to the Company financial statements 184

Interest in subsidiaries, joint ventures and associates 188



“Value added” is the value which the Group has added to purchased materials and goods by process of manufacture and conversion, and the

sale of its products and services. This statement shows how the value so added has been distributed.

2007 2006

R’000 % R’000 %

Revenue 95 655 509 77 276 491

Net cost of raw materials, goods and services (78 796 629) (63 330 096)

Wealth created by trading operations 16 858 880 13 946 395

Finance income 161 919 116 466

Total wealth created 17 020 799 100,0 14 062 861 100,0

Distributed as follows

Employees

Benefi ts and remuneration 9 967 448 58,6 8 311 320 59,1

Government

Current taxation 1 011 364 5,9 915 538 6,5

Providers of capital 1 909 099 11,2 1 448 199 10,3

Finance charges 675 680 4,0 432 607 3,1

Distributions to shareholders 1 233 419 7,2 1 015 592 7,2

Retained for growth 4 132 888 24,3 3 387 804 24,1

Depreciation and amortisation 1 188 788 7,0 984 913 7,0

Impairments 244 046 1,4 14 174 0,1

Profi t for the year attributable to shareholders

of the Company 2 700 054 15,9 2 388 717 17,0

17 020 799 100,0 14 062 861 100,0

Value added statement

South African Foreign

2007

R’000

2006

R’000

2007

R’000

2006

R’000

Employee taxes 828 778 722 350 1 230 678 842 728

Company taxes 732 100 655 910 279 264 259 628

Value added tax and sales tax 4 172 125 3 696 489 350 873 288 633

Customs and excise duty 10 374 224 7 639 345 419 399 273 818

Other 186 284 188 773 144 228 122 955

16 293 511 12 902 867 2 424 442 1 787 762

Exchanges with governmentincluding amounts collected on their behalf

2006

24,1%

10,3% 59,1%

6,5%

2007

24,3%

11,2%58,6%

5,9%

■ Employees

■ Government

■ Providers of capital

■ Retained for growth


Directors’ responsibility for the fi nancial statements

To the members of The Bidvest Group Limited

The directors are responsible for the preparation and fair presentation of the Group and Company fi nancial statements in accordance with

International Financial Reporting Standards and in the manner required by the Companies Act of South Africa.

The directors’ responsibility includes: designing, implementing and maintaining internal controls relevant to the preparation and fair

presentation of these fi nancial statements that are free from material misstatement, whether due to fraud or error; selecting and applying

appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

The directors’ responsibility also includes maintaining adequate accounting records and an eff ective system of risk management.

The directors have made an assessment of the Group and Company’s ability to continue as a going concern and there is no reason to believe

that the businesses will not be going concerns in the year ahead.

The auditors are responsible for reporting on whether the Group and Company fi nancial statements are fairly presented in accordance with the

applicable fi nancial reporting framework.

The fi nancial statements of the Group and Company were approved by the board of directors on August 24 2007 and are signed on its

behalf by:

Cyril Ramaphosa Brian Joff e

Non-executive chairman Chief executive

Declaration by company secretary

In my capacity as company secretary, I hereby confi rm, in terms of the Companies Act of South Africa, that for the year ended June 30 2007, the

Company has lodged with the Registrar of Companies, all such returns as are required in terms of this Act and that all such returns are true, correct and

up to date.

Margaret David

Company secretary

August 24 2007


Independent auditors’ report

To the members of The Bidvest Group Limited

We have audited the fi nancial statements and Group fi nancial statements of The Bidvest Group Limited, which comprise the balance sheets

at June 30 2007, and the income statements, the statement of recognised income and expenses and cash fl ow statements for the year then

ended, and the notes to the fi nancial statements, which include a summary of signifi cant accounting policies and other explanatory notes and

the directors’ report as set out on pages 6 to 8 and 129 to 191.

Directors’ responsibility for the fi nancial statements

The directors are responsible for the preparation and fair presentation of these fi nancial statements in accordance with International Financial

Reporting Standards and in the manner required by the Companies Act of South Africa. This responsibility includes: designing, implementing

and maintaining internal control relevant to the preparation and fair presentation of fi nancial statements that are free from material

misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are

reasonable in the circumstances.

Auditors’ responsibility

Our responsibility is to express an opinion on these fi nancial statements based on our audit. We conducted our audit in accordance with

International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to

obtain reasonable assurance whether the fi nancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements. The

procedures selected depend on the auditors’ judgement, including the assessment of the risks of material misstatement of the fi nancial

statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal controls relevant to the entity’s

preparation and fair presentation of the fi nancial statements in order to design audit procedures that are appropriate in the circumstances,

but not for the purpose of expressing an opinion on the eff ectiveness of the entity’s internal control. An audit also includes evaluating the

appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the

overall presentation of the fi nancial statements.

We believe that the audit evidence we have obtained is suffi cient and appropriate to provide a basis for our audit.

Opinion

In our opinion, the fi nancial statements present fairly, in all material respects, the fi nancial position of the Company and of the Group at

June 30 2007, and their fi nancial performance and cash fl ows for the year then ended in accordance with International Financial Reporting

Standards, and in the manner required by the Companies Act of South Africa.

KPMG Inc.

Registered Auditor

Per G Aldrighetti

Chartered Accountant (SA)

Registered Auditor

Director

August 24 2007


Directors’ report

The directors have pleasure in presenting their report and audited fi nancial statements for the year ended June 30 2007.

Nature of business

The Company is an investment holding company with subsidiaries operating in services, trading and distribution. Details of the Group’s activities

are included in the review of operations.

Financial reporting

The directors are required by the Companies Act of South Africa to produce fi nancial statements which fairly present the state of aff airs of

the Group and the Company as at the end of the fi nancial year and the profi t or loss for that year, in conformity with International Financial

Reporting Standards (IFRS) and the Companies Act of South Africa.

The fi nancial statements as set out in this report have been prepared by management in accordance with IFRS and the Companies Act of South

Africa and are based on appropriate accounting policies, which are supported by reasonable and prudent judgements and estimates.

The directors are of the opinion that the fi nancial statements fairly present the fi nancial position of the Group and of the Company as at

June 30 2007 and the results of their operations and cash fl ows for the year then ended.

The directors are satisfi ed that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly,

the Group continues to adopt the going-concern basis in preparing the fi nancial statements.

Acquisitions and disposals

Total acquisitions amounted to R908,3 million during the year, including the acquisition of the Angliss Asia Group ( refer note 11 of the Group

fi nancial statements).

The only disposals during the year were disposals of interests in associates and reductions of shareholdings in subsidiaries.

Results of operations

The results of operations are dealt with in the consolidated income statement, segmental analysis and review of operations.

Share capital

The Company issued a total of 5 575 569 ordinary shares of 5 cents each at premiums of between R17,50 and R108,49 per share, in terms

of The Bidvest Incentive Scheme. Of these ordinary shares, 3 923 000 were in respect of the share purchase scheme and the balance in respect

of the share option scheme (refer note 26 of the Group fi nancial statements).

Movement in treasury shares

In terms of general authorities granted to the Company to repurchase its ordinary shares, the latest being shareholder authority obtained at the

last annual general meeting, a maximum of 66 150 793 ordinary shares could be acquired by the Company of which 33 075 397 can be acquired

by its subsidiaries. A subsidiary and The Bidvest Incentive Scheme acquired a total of 21 923 798 ordinary shares at an average price of R86,12 per

share. Included in the total acquisitions are 18 000 000 ordinary shares acquired by a subsidiary from Dinatla Investment Holdings (Pty) Limited

(“Dinatla”) in terms of a special resolution passed at the last annual general meeting. A total of 20 045 632 ordinary shares was disposed of by a

subsidiary at an average price of R59,29 per share, of which 17 928 046 shares were issued in terms of the Group’s obligation to the Bidvest option

holders, with the balance being issued to staff members on exercise of their share options.


Distributions out of share premium in lieu of dividends

A cash distribution out of share premium of 207,0 cents per share, in lieu of a dividend, was paid to shareholders on October 2 2006.

A cash distribution out of share premium of 198,0 cents per share, in lieu of a dividend, was paid to shareholders on April 2 2007.

Subsequent to year end a distribution out of share premium of 248,4 cents per share, in lieu of a dividend, was awarded. The salient dates are:

Distribution dates:

Last day to trade cum-distribution Friday, September 14 2007

Trading ex-distribution commences Monday, September 17 2007

Record date Friday, September 21 2007

Payment date Tuesday, September 25 2007

Payments to shareholders

Approval was obtained at the last annual general meeting for the Company to make payments which would reduce its share capital, share

premium, reserves and/or any capital redemption reserve fund in terms of section 90 of the Companies Act of South Africa.

Shareholders will be requested at the forthcoming annual general meeting of the Company to be held on November 7 2007 to consider the

ordinary resolution to pay by way of a reduction of share capital or share premium, in lieu of a dividend, an amount equal to the amount which

directors of the Company would have declared and paid out of profi ts in respect of the Company’s interim and fi nal dividends for the fi nancial

year ending June 30 2008.

Special resolutions

Special resolutions were passed at the annual general meeting of shareholders held on October 31 2006 in regard to:

– a general authority to enable the Company to acquire its own shares;

– the cancellation of the articles of association and adoption of new articles in order to incorporate amendments to the Companies Act,

including the electronic transmission of documents and to take into account special resolutions passed since 1990, previously approved by

shareholders; and

– authorisation to repurchase 18 000 000 ordinary shares in the Company, being a specifi c repurchase from Dinatla by BB Investment Holdings

(Pty) Limited, a wholly owned subsidiary of the Company.

Special resolutions were passed by certain subsidiaries to accommodate the acquisition of various businesses, to amend articles of associations

and to change their names.

Directorate

The following changes to the board were recorded:

MBN Dube resigned as an executive director on September 1 2006 but retains her position on the board as a non-executive director;

CH Kretzmann retired on June 26 2007; DE Cleasby, formerly an alternate director to P Nyman, was appointed as fi nancial director on

July 9 2007; G Marcus and BE Moff at resigned on August 21 2007; and T Slabbert, previously an alternate director, was appointed as a

non-executive director on August 21 2007.

In terms of the Company’s articles of association the following directors retire at the forthcoming annual general meeting:

FJ Barnes, MC Berzack, B Joff e, S Koseff , P Nyman, JL Pamensky, MC Ramaphosa and AC Salomon retire by rotation. DE Cleasby and T Slabbert

retire in terms of article 53.3 of the articles of association. All retiring directors are eligible and available for re-election.

Directors’ report


The names of the directors who were in offi ce during the period September 2 2006 to August 24 2007 and the number of meetings attended by each of the directors is:

Director BoardAcquisitioncommittee

Auditcommittee

Nominationcommittee

Remunerationcommittee

Riskcommittee

Transformationcommittee

Non-executiveMC Ramaphosa 5/5 0/1DDB Band 4/5 1/1 5/5 1/1 2/2LG Boyle(A) 5/5AA Da Costa 5/5MBN Dube(A) 5/5 0/2S Koseff 4/5RM Kunene 3/5D Masson 4/5 1/1 2/5 0/2 4/4JL Pamensky 5/5 1/1 5/5 1/1 2/2NG Payne 4/5 5/5 4/4T Slabbert(B) 3/3(C) 0/1 1/2FDP Tlakula 2/5 0/2

Executive B Joff e 5/5 1/1 1/1 2/2(E) 4/4 2/2FJ Barnes 5/5BL Berson 4/5MC Berzack 5/5 1/1 4/4 2/2DE Cleasby(B) 5/5(D) 1/1 5/5(D) 2/2 4/4(D)

AW Dawe 5/5 4/4 1/2LI Jacobs 5/5 2/2P Nyman 5/5 5/5 2/2 4/4SG Pretorius 5/5 4/4 1/2LP Ralphs 5/5 1/1 3/4 1/2AC Salomon 5/5 5/5 3/4

AlternatesLJ Mokoena n/a

Former directorsCH Kretzmann 4/4 3/3 1/1G Marcus 4/4BE Moff at 0/2 0/3

(A)formerly an executive director.(B)formerly an alternate director.(C)two meetings representing BE Moff at.(D)four board meetings, four audit committee meetings and three risk committee meetings by invitation.(E)by invitation.

Directors’ interests

The aggregate interests of the directors in the capital of the Company at June 30 2007 were:

Number of shares2007 2006

Benefi cial 4 963 022 6 853 281Non-benefi cial 28 073 469 43 381 528Held in terms of The Bidvest Incentive Scheme Options 2 990 282 3 837 283 Shares 1 160 000 –


Directors’ report

Directors’ shareholdings

The individual interests declared by the current directors and offi cers in the Company’s share capital at June 30 2007 held directly or indirectly were:

Benefi cial 2007 2006Director Direct Indirect Direct Indirect

BL Berson 8 8MC Berzack 44 386 41 456AA Da Costa 144 771 241 209LI Jacobs 1 858 396 1 841 471B Joff e 129 068 449 032S Koseff 8 8RM Kunene 442 289 737 129D Masson 8 3 242 8 3 028LJ Mokoena 220 860 368 114P Nyman 93 528 87 761JL Pamensky 8 8SG Pretorius 25 000 25 000LP Ralphs 242 657 274 986MC Ramaphosa 1 558 741 2 597 501AC Salomon 189 321 175 831Former directors 10 731 10 731

Total 734 723 4 228 299 1 064 829 5 788 452

Held in terms of The Bidvest Incentive Scheme

The Bidvest Incentive Scheme grants loans to staff and directors for the acquisition of shares in the Company. The numbers of shares and carrying values of the loans issued to directors as at June 30 2007 were:

2007 2006

DirectorNumber

of shares

Carrying value of loan

R’000Numberof shares

Carrying value of loan

R’000

FJ Barnes 100 000 12 600BL Berson 50 000 6 300MC Berzack 150 000 16 205DE Cleasby 75 000 8 102AW Dawe 100 000 10 803LI Jacobs 50 000 5 402B Joff e 200 000 21 607P Nyman 50 000 5 402SG Pretorius 150 000 16 205LP Ralphs 150 000 16 205AC Salomon 75 000 8 102MA David (Secretary) 10 000 1 080

Total 1 160 000 128 013 – –

Non-benefi cial

In addition to the aforementioned holdings:

– B Joff e is a trustee and potential benefi ciary of a discretionary trust holding 3 363 488 (2006: 3 363 484) shares;– P Nyman is a trustee of various trusts holding 5 357 049 (2006: 5 046 549) shares but has no benefi cial interest in these shares;– D Masson and P Nyman are trustees of the Group’s retirement funds which hold 938 798 (2006: 783 724) shares. P Nyman is also a trustee of a

Group medical aid society which holds 29 825 (2006: 30 175) shares; and– AA Da Costa, LI Jacobs, RM Kunene and LJ Mokoena are directors and shareholders of Dinatla and their indirect benefi cial holdings have been

included in the table of holdings. P Nyman and T Slabbert are also directors of Dinatla but have no benefi cial interest in Dinatla’s shares. Dinatla holds 27 001 744 (2006: 45 001 744) shares.

The only director who was directly or indirectly interested in excess of 1% of the Company’s issued share capital was B Joff e.

Number of shares2007 2006

Benefi cial 129 068 449 032Held in terms of The Bidvest Incentive Scheme 200 000 –Non-benefi cial 3 363 488 3 363 484

3 692 556 3 812 516

The interests of the directors remained unchanged from the end of the fi nancial year to the date of this report.


Directors’ remuneration

The remuneration paid to directors while in offi ce of the Company during the year ended June 30 2007 can be analysed as follows:

Executive

Basic remuner-

ationR’000

Other benefi ts

R’000

Retire-ment/

medicalbenefi ts

R’000

Cash incen-

tivesR’000

Total emolu-

mentsR’000

Share- based

paymentexpense

R’000

2007 Total

R’000

2006Total

R’000

FJ Barnes 4 184 237 240 2 092 6 753 183 6 936 6 042BL Berson 2 050 145 445 2 042 4 682 156 4 838 3 668MC Berzack 2 413 320 419 2 800 5 952 1 443 7 395 5 869DE Cleasby 1 185 207 134 1 000 2 526 545 3 071AW Dawe 1 920 89 289 1 800 4 098 723 4 821LI Jacobs 892 122 129 600 1 743 576 2 319 1 752B Joff e 5 836 586 372 7 422 14 216 2 033 16 249 13 528P Nyman 1 303 79 117 1 000 2 499 731 3 230 2 781SG Pretorius 2 366 180 483 3 000 6 029 1 249 7 278 6 146LP Ralphs 2 388 365 283 2 500 5 536 1 443 6 979 5 190AC Salomon 1 820 187 206 1 800 4 013 1 023 5 036 4 075

Former directors

LG Boyle 3 196 3 196 3 196 2 512MBN Dube 212 22 234 51 285 1 550CH Kretzmann 1 856 91 175 600 2 722 783 3 505 3 727Directors who resigned in 2006 16 493

2007 Total 28 425 5 804 3 314 26 656 64 199 10 939 75 138 73 333

2006 Total 30 650 3 365 3 793 23 010 60 818 12 515 73 333

Non-executive

Directors’fees

R’000

Otherservices

R’000

Totalemolu-mentsR’000

Share- based

paymentexpense

R’000

2007Total

R’000

2006Total

R’000

DDB Band 223 223 223 128LG Boyle† 72 72 662 734AA Da Costa 72 72 72 39MBN Dube† 56 56 257 313S Koseff 54 54 54 33RM Kunene 54 54 54 33D Masson 207 153 360 360 278LJ Mokoena 14 14 14 17JL Pamensky 214 83 297 297 137NG Payne 198 198 198MC Ramaphosa 400 400 400 360T Slabbert 32 32 32 34FDP Tlakula 45 45 45

Former directors

G Marcus 72 72 72 33BE Moff at 81 81 81 82Directors who resigned in 2006 508

2007 Total 1 794 236 2 030 919 2 949 1 682

2006 Total 1 226 170 1 396 286 1 682

† formerly an executive director.

Directors’ service contracts

Directors do not have fi xed-term contracts.


Directors’ and offi cers’ disclosure of interest in contracts

During the fi nancial year no contracts were entered into in which directors and offi cers of the Company had an interest and which signifi cantly aff ected the business of the Group. The directors had no interest in any third party or company responsible for managing any of the business activities of the Group.

Details of the directors’ and offi cers’ outstanding share options

Share options at June 30 2006 Share options exercised

Share options at June 30 2007

Director Number

Average price

R Number

Average price

R

Benefi t arising on

exerciseof options

R’000 Number

Average price

R

FJ Barnes 55 000 47,64 18 750 43,00 1 866 36 250 50,04BL Berson 42 000 48,56 42 000 48,56MC Berzack 296 252 44,89 20 000 17,55 2 078 276 252 46,86DE Cleasby 78 250 53,95 8 250 39,29 840 70 000 55,68AW Dawe 124 250 48,86 30 000 39,10 3 061 94 250 51,96LI Jacobs 80 000 57,97 80 000 57,97B Joff e 474 080 47,71 150 000 35,32 12 687 324 080 53,45P Nyman 526 200 41,68 526 200 41,68SG Pretorius 135 000 58,11 135 000 58,11LP Ralphs 615 000 43,99 615 000 43,99AC Salomon 460 000 45,29 460 000 45,29MA David (Secretary) 36 250 53,67 15 000 46,19 1 399 21 250 58,96

Former executive directors

LG Boyle 355 000 46,20 130 000 42,65 11 634 225 000 48,26MBN Dube 85 000 55,35 85 000 55,35

3 362 282 46,46 372 000 38,14 33 565 2 990 282 42,22

Former director

CH Kretzmann 475 001 46,13 50 000 40,20 5 046

Total 3 837 283 46,21 422 000 38,39 38 611 2 990 282 42,22

These options are exercisable over the period July 1 2007 to May 31 2015. A detailed register of options outstanding by tranche is available for inspection at the Company’s registered offi ce.

Secretary

Ms MA David is the company secretary. The business and postal addresses of the secretary, which are also the registered addresses of the Company, are refl ected on page 208 of the report.

Subsidiaries and joint ventures

The attributable interest of the Company in the aggregate net profi ts and losses for the year of its subsidiaries and joint ventures was:

2007R’000

2006R’000

Profi ts 2 840 163 2 421 210Losses (33 257) (32 493)

Directors’ report


The consolidated and separate fi nancial statements have been prepared in accordance with International Financial Reporting Standards (IFRS)

and its interpretations adopted by the International Accounting Standards Board (IASB).

1. Basis of preparation

The consolidated and separate fi nancial statements are prepared on the historical cost basis except that derivative fi nancial instruments,

fi nancial instruments held-for-trading and fi nancial instruments classifi ed as available-for-sale are stated at their fair value.

Non-current assets and disposal groups held-for-sale are stated at the lower of carrying amount and fair value less costs to sell.

The preparation of fi nancial statements in conformity with IFRS requires management to make judgements, estimates and assumptions

that aff ect the application of policies and reported amounts of assets and liabilities, income and expenses. Although estimates and

associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the

circumstances (the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not

readily apparent from other sources), the actual outcome may diff er from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the

period in which the estimate is revised, if the revision aff ects only that period, or in the period of the revision and future periods if the

revision aff ects both current and future periods.

Judgements made in the application of IFRS that have had an eff ect on the fi nancial statements and estimates with a risk of adjustment in

the next year are discussed in note 38.

The accounting policies set out below have been applied consistently to all periods presented in these consolidated fi nancial statements.

These fi nancial statements are presented in South African rand, which is the Company’s functional currency. All fi nancial information has

been rounded to the nearest thousand unless stated otherwise.

2. Basis of consolidation

The consolidated fi nancial statements include the fi nancial statements of the Company and its subsidiaries. Subsidiaries are entities

controlled by the Company. Control exists when the Company has the power, directly or indirectly, to govern the fi nancial and operating

policies of an entity so as to obtain benefi ts from its activities. In assessing control, potential voting rights that presently are exercisable

or convertible are taken into account. Operating results of businesses acquired or disposed of during the year are included from or to the

eff ective date of acquisition or disposal, being the date that control commences until the date control ceases. The assets and liabilities of

companies acquired are assessed and included in the balance sheet at their estimated fair values to the Group at acquisition date.

Inter-group transactions and balances are eliminated on consolidation. Unrealised gains arising from transactions with jointly controlled

entities and equity accounted associates are eliminated to the extent of the Group’s interest in the entity. Unrealised losses are eliminated

in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

The Company carries its investments in subsidiaries at cost less accumulated impairment losses.

3. Revenue

Revenue comprises amounts invoiced to customers for goods and services and includes fi nance charges, insurance premiums, gross

billings, commissions related to clearing and forwarding transactions and excludes value added tax. Revenue is net of returns and

allowances, trade discounts and volume rebates. Total revenue also includes dividends received and fi nance income.

4. Revenue recognition

The sale of goods is recognised when signifi cant risks and rewards of ownership of the goods are transferred to the buyer, recovery of

the consideration is considered probable, the associated costs and possible return of goods can be estimated reliably, and there is no

continuing management involvement with the goods.

Revenue from services rendered is recognised in the income statement in proportion to the stage of completion of the transaction at the

balance sheet date. The stage of completion is assessed by reference to the terms of the contracts.

Accounting policies


Accounting policies

4. Revenue recognition (continued)

Revenue relating to banking activities consists primarily of margins earned on the purchase and sale of foreign exchange products and

general commissions and transaction fees and is recognised when the services are provided. Net profi ts and losses on the revaluation of

foreign currency denominated assets and liabilities are also included in revenue.

In the event that a profi t or loss arises from full maintenance motor contracts, this is recognised on termination of individual contracts after

taking cognisance of any additional costs required. Provision is made for known losses during the contract period on an individual contract

basis.

Insurance premiums are stated before deducting reinsurances and commissions, and are accounted for when they become due.

Finance income comprises interest receivable on funds and dividend income on preference shares.

Interest is recognised on a time proportion basis, taking account of the principal outstanding and the eff ective rate over the period to

maturity, when it is determined that such income will accrue to the Group.

Dividends are recognised when the right to receive payment is established.

5. Non-current assets held-for-sale and discontinued operations

Non-current assets (or disposal groups comprising assets and liabilities) that are expected to be recovered primarily through sale rather

than through continuing use are classifi ed as held-for-sale and are carried at the lower of carrying value and fair value less costs to sell.

Immediately before classifi cation as assets held-for-sale, the measurement of the assets (and all assets and liabilities in a disposal group) is

brought up-to-date in accordance with applicable IFRS. Then, on initial classifi cation as assets held-for-sale, non-current assets and disposal

groups are recognised at the lower of the carrying amounts and fair value less costs to sell. Any impairment loss on a disposal group is fi rst

allocated to goodwill, and then to remaining assets and liabilities on a pro rata basis, except that no loss is allocated to inventories, fi nancial

assets, deferred tax assets, and employee benefi t assets, which continue to be measured in accordance with the Group’s accounting

policies. Impairment losses on initial classifi cation as held-for-sale and subsequent gains or losses on remeasurement are recognised in the

income statement. Gains are not recognised in excess of any cumulative impairment loss.

A discontinued operation results from the sale or abandonment of an operation that represents a separate major line of business or

geographical area of operations and of which the assets, net profi t or loss and activities can be distinguished physically, operationally and

for fi nancial reporting purposes. A subsidiary acquired exclusively with the view to resale is also classifi ed as a discontinued operation.

Classifi cation as a discontinued operation occurs upon disposal or when the operation meets the criteria to be classifi ed as held-for-sale, if

earlier. When an operation is classifi ed as a discontinued operation, the comparative income statement is restated as if the operation had

been discontinued from the start of the comparative period.

6. Distributions to shareholders

Distributions to shareholders are accounted for once they have been approved by the board of directors.

7. Finance charges

Finance charges comprise interest payable on borrowings calculated using the eff ective interest rate method. The interest expense

component of fi nance lease payments is recognised in the income statement using the eff ective interest rate method.

8. Capitalisation of expenditure/borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of

time to prepare for their intended use or sale are added to the cost of those assets, until such time as the assets are substantially complete.

Capitalisation is suspended during extended periods in which active development is interrupted. All other borrowing costs are expensed

in the period in which they are incurred.

9. Cash and cash equivalents

For the purpose of the cash fl ow statement, cash and cash equivalents comprise cash on hand, deposits held on call with banks net of

bank overdrafts, investment in money market instruments and variable rate cumulative redeemable preference shares, all of which are

available for use by the Group unless otherwise stated.

10. Property, plant and equipment

Property, plant and equipment are refl ected at cost to the Group, less accumulated depreciation and accumulated impairment losses.

Land is stated at cost. The present value of the estimated cost of dismantling and removing items and restoring the site in which they are


located is provided for as part of the cost of the asset. Depreciation is provided for on the straight-line basis over the estimated useful lives

of the property, plant and equipment which are currently as follows:

Buildings Up to 50 years

Leasehold premises Over the period of the lease

Plant and equipment 5 to 20 years

Offi ce equipment, furniture and fi ttings 3 to 15 years

Vehicles, vessels and craft 3 to 10 years

Rental assets 3 to 5 years

Capitalised leased assets The same basis as owned assets

Residual values, depreciation method and useful lives are reassessed annually.

Where parts of an item of property, plant and equipment have diff erent useful lives, they are accounted for as separate items of property,

plant and equipment.

The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when

that cost is incurred if it is probable that the future economic benefi ts embodied in the item will fl ow to the Group and the cost of the item

can be measured reliably. All other costs are recognised in the income statement as an expense when incurred.

11. Leases

Leases that transfer substantially all the risks and rewards of ownership of the underlying asset to the Group are classifi ed as fi nance leases.

Assets acquired in terms of fi nance leases are capitalised at the lower of fair value and the present value of the minimum lease payments at

inception of the lease, and depreciated over the estimated useful life of the asset. The capital element of future obligations under the leases

is included as a liability in the balance sheet. Lease payments are allocated using the eff ective interest rate method to determine the lease

fi nance cost, which is charged against income over the lease period, and the capital repayment, which reduces the liability to the lessor.

Leases where the lessor retains the risks and rewards of ownership of the underlying asset are classifi ed as operating leases. Operating

leases, which have a fi xed determinable escalation, are charged against income on a straight-line basis. Leases with contingent escalations

are expensed as and when incurred.

12. Goodwill

Goodwill represents amounts arising on acquisition of subsidiaries, associates and joint ventures. All business combinations are accounted

for by applying the purchase method. In respect of business acquisitions that have occurred since March 31 2004, goodwill represents the

diff erence between the cost of the acquisition and the fair value of the identifi able assets, liabilities and contingent liabilities acquired.

As part of its transition to IFRS, the Group elected to restate only those business combinations that occurred on or after March 31 2004. In

respect of acquisitions prior to this date, goodwill is included on the basis of its deemed cost, being cost less accumulated amortisation at

March 31 2004, which represents the amount recorded under previous South African Generally Accepted Accounting Practice.

Goodwill is stated at deemed cost or cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is

tested annually for impairment. In respect of associates, the carrying amount of goodwill is included in the carrying amount of the interest

in the associate.

Negative goodwill arising on an acquisition is recognised immediately in the income statement.

Goodwill arising on the acquisition of a minority interest in a subsidiary represents the excess of the cost of the additional investment over

the carrying amount of the net assets acquired at the date of exchange.

13. Intangible assets

Software development costs are capitalised and are stated at cost less accumulated amortisation and accumulated impairment losses.

Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and accumulated impairment losses.

Expenditure on research, internally generated goodwill and brands is recognised in the income statement as an expense as incurred.

Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefi ts embodied in

the specifi c asset to which it relates. All other expenditure is expensed as incurred.


13. Intangible assets (continued)

Amortisation is charged to the income statement on a straight-line basis over the estimated useful lives of intangible assets unless such

lives are indefi nite. Intangible assets with an indefi nite useful life are systematically tested for impairment at each balance sheet date. Other

intangible assets are amortised from the date they are available for use. The estimated useful lives are currently:

Patents, trademarks, tradenames and other intangibles 3 to 12 years

Computer software 3 to 7 years

Useful lives are also examined on an annual basis and adjustments, where applicable, are made on a prospective basis.

14. Impairment of assets

The carrying value of assets is reviewed at each balance sheet date to assess whether there is any indication of impairment. If any such

indication exists, the recoverable amount of the asset is estimated. Where the carrying value exceeds the estimated recoverable amount,

such assets are written down to their recoverable amount.

The recoverable amount of cash-generating units to which goodwill is allocated is estimated annually on March 31 each year. For assets

that have an indefi nite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated at each

balance sheet date.

Impairment losses are recognised whenever the carrying amount of the asset or a cash-generating unit exceeds its recoverable amount.

Impairment losses are recognised in the income statement.

Impairment losses recognised in respect of cash-generating units are allocated fi rst to reduce the carrying amount of any goodwill

allocated to cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro rata basis.

A cash-generating unit is the smallest identifi able asset group that generates cash fl ows that largely are independent from other assets and groups.

An impairment loss in respect of an available-for-sale fi nancial asset is calculated by reference to its current fair value.

When a decline in the fair value of an available-for-sale fi nancial asset has been recognised directly in equity and there is objective evidence that the

asset is impaired, the cumulative loss that had been recognised directly in equity is recognised in the income statement even though the fi nancial

asset has not been derecognised. The amount of the cumulative loss that is recognised in the income statement is the diff erence between the

acquisition cost and current fair value, less any impairment loss on that fi nancial asset previously recognised in the income statement.

The recoverable amount of the Group’s investments in held-to-maturity securities and receivables carried at amortised cost is calculated as

the present value of estimated future cash fl ows, discounted at the original eff ective interest rate (the eff ective interest rate is computed on

initial recognition of these fi nancial assets). Receivables with a short duration are not discounted. Individually signifi cant fi nancial assets are

tested for impairment on an individual basis. The remaining fi nancial assets are assessed collectively in groups that share similar credit risk

characteristics.

The recoverable amount of other assets is the greater of their fair value less costs to sell and their value in use. In assessing their value

in use, the estimated future cash fl ows are discounted to their present value using a pre-tax discount rate that refl ects current market

assessments of the time value of money and the risks specifi c to the asset.

An impairment loss in respect of a held-to-maturity security or receivable carried at amortised cost is reversed if the subsequent increase in

recoverable amount can be related objectively to an event occurring after the impairment loss was recognised.

An impairment loss in respect of an investment in an equity instrument classifi ed as available-for-sale is not reversed through the income

statement. If the fair value of a debt instrument classifi ed as available-for-sale increases and the increase can be objectively related to an

event occurring after the impairment loss was recognised in the income statement, the impairment loss is reversed, with the amount of

the reversal recognised in the income statement.

Impairment losses in respect of goodwill are not reversed.

In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the

loss has decreased or no longer exists. Impairment losses are reversed if there has been a change in the estimates used to determine the

recoverable amount.

Accounting policies


Impairment losses are reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have

been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

15. Taxation

Income tax comprises current and deferred tax. Income tax expense is recognised in profi t or loss except to the extent that it relates to

items recognised directly in equity, in which case it is recognised in equity.

Current taxation comprises tax payable calculated on the basis of the expected taxable income for the year, using the tax rates enacted or

substantially enacted at the balance sheet date, and any adjustment of tax payable for previous years.

Deferred taxation is recognised using the balance sheet liability method based on temporary diff erences between the tax base of an

asset or liability and its balance sheet carrying amount. Temporary diff erences are diff erences between the carrying amount of assets and

liabilities for fi nancial reporting purposes and their tax base. The amount of deferred tax provided is based on the expected manner of

realisation or settlement of the carrying amount of assets and liabilities using tax rates enacted or substantively enacted at the balance

sheet date. The following temporary diff erences are not provided for: initial recognition of goodwill, the initial recognition of assets or

liabilities in a transaction that is not a business combination and that aff ects neither accounting nor taxable profi t, and diff erences relating

to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. Deferred taxation is charged to the

income statement except to the extent that it relates to a transaction that is recognised directly in equity, or a business combination that is

an acquisition. The eff ects on deferred taxation of any changes in tax rates is recognised in the income statement, except to the extent that

it relates to items previously charged or credited directly to equity.

A deferred tax asset is recognised to the extent that it is probable that future taxable profi ts will be available against which the associated

unused tax losses and deductible temporary diff erences can be utilised. Deferred tax assets are reviewed at each reporting date and are

reduced to the extent that it is no longer probable that the related tax benefi t will be realised.

Secondary taxation on companies is accounted for as a tax charge in the income statement as incurred.

16. Associates

An associate is a company over which the Group has the ability to exercise signifi cant infl uence, but not control, over its fi nancial and

operating policies.

The equity method of accounting for associates is adopted in the Group fi nancial statements. In applying the equity method, account is

taken of the Group’s share of accumulated retained earnings and movements in reserves from the eff ective dates on which the companies

became associates and up to the eff ective dates of disposal. In the event of associates making losses, the Group recognises the losses to

the extent of the Group’s exposure.

The Company carries its investment in associates at cost less any accumulated impairment losses.

Goodwill inherent in the cost of an associate is accounted for in accordance with the Group’s accounting policy for goodwill. This goodwill

has been included in the carrying value of associates.

17. Joint ventures

Joint ventures are those entities over whose activities the Group has joint control, established by contractual agreement. The Group’s

interests in joint ventures are accounted for using the proportionate consolidation method and its shares of the underlying assets,

liabilities, income, expenditures and cash fl ows are included in the consolidated fi nancial statements on a line-by-line basis from the date

that joint control commences until the date joint control ceases.

The Company carries its investments in joint ventures at cost less accumulated impairment losses.

18. Foreign operations

Assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated into

South African rand at rates of exchange ruling at the balance sheet date. Income, expenditure and cash fl ow items are translated into

South African rand at rates approximating the foreign exchange rates ruling at the dates of the transactions. Since July 1 2004, the Group’s

date of transition to IFRS, foreign exchange diff erences arising on translation are recognised directly in equity as a foreign currency

translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in the foreign currency translation reserve

is transferred to the income statement.


18. Foreign operations (continued)

The revenues and expenses of foreign operations in hyperinfl ationary economies are translated to South African rand at the foreign

exchange rates ruling at the balance sheet date. Foreign exchange diff erences arising on retranslation are recognised directly in a separate

component of equity.

Acquisitions and disposals of foreign operations are accounted for at the rate ruling on the date of the transaction.

19. Financial instruments

Financial instruments are recognised when the Group or Company becomes party to the contractual provisions of the arrangement.

Financial instruments are initially measured at fair value plus, for instruments not carried at fair value through profi t and loss, any directly

attributable transaction costs.

An instrument is classifi ed as at fair value through profi t or loss if it is held-for-trading, is a derivative or is designated as such upon initial

recognition. Financial instruments at fair value through profi t or loss are measured at fair value, with any resultant gain or loss being recognised

in the income statement. Held-for-trading fi nancial instruments are measured at amortised cost if the fair value cannot be determined.

Financial instruments classifi ed as available-for-sale fi nancial assets are carried at fair value with any resultant gain or loss, other than

impairment losses and foreign exchange gains and losses on monetary items, being recognised directly in equity. When these investments

are derecognised, the cumulative gain or loss previously recognised directly in equity is recognised in profi t or loss. Where these

investments are interest bearing, interest calculated using the eff ective interest rate method is recognised in profi t or loss.

If the Group has the positive intent and ability to hold debt securities to maturity, then they are classifi ed as held-to-maturity. Investments

that meet the criteria for classifi cation as held-to-maturity fi nancial assets are carried at amortised cost.

Where the instrument is not classifi ed as one of the above, it is carried at amortised cost.

Listed and unlisted investments are classifi ed as investments at fair value through profi t or loss or available-for-sale fi nancial assets. Fair

value of listed investments is calculated by reference to stock exchange quoted selling prices at the close of business on the balance sheet

date. Fair value of unlisted investments is determined by using appropriate valuation models.

Trade and other receivables originated by the Group or Company are stated at fair value less impairment losses.

Cash and cash equivalents are measured at fair value, based on the relevant exchange rates at balance sheet date.

Financial liabilities other than derivatives are recognised at amortised cost using the eff ective interest rate method.

Derivative instruments are measured at fair value through profi t and loss.

Where a derivative fi nancial instrument is used to economically hedge the foreign exchange exposure of a recognised fi nancial asset or

liability, no hedge accounting is applied and any gain or loss on the hedging instrument is recognised in the income statement. It is the

policy of the Group not to trade in derivative fi nancial instruments for speculative purposes.

Gains and losses arising from measuring the hedging instruments relating to a fair value hedge at fair value are recognised in the income

statement. The hedged item is also stated at fair value in respect of the risk being hedged, with any gains or losses recognised in the

income statement.

Where a derivative is designated as a cash fl ow hedge, the eff ective part of the gains or losses from remeasuring the hedging instruments

to fair value are initially recognised directly in equity. If the hedged fi rm commitment or forecast transaction results in the recognition

of a non-fi nancial asset or liability, the cumulative amount recognised in equity up to the transaction date is adjusted against the

initial measurement of the non-fi nancial asset or liability. The ineff ective part of any gain or loss is recognised in the income statement

immediately. For other cash fl ow hedges, the cumulative amount recognised in equity is included in net profi t or loss in the period when

the commitment or forecast transaction aff ects profi t or loss.

Where the hedging instrument or hedge relationship is terminated but the hedged transaction is still expected to occur, the cumulative

unrealised gain or loss at that point remains in equity and is recognised in accordance with the aforementioned policy when the

transaction occurs. If the hedged transaction is no longer expected to occur, the cumulative unrealised gain or loss is recognised in the

income statement immediately.

Accounting policies


A fi nancial asset is derecognised (or, where applicable, a part of a fi nancial asset or a part of a group of similar fi nancial assets is

derecognised) if the Group’s contractual rights to the cash fl ows from the fi nancial asset expire or if the Group transfers the fi nancial assets

to another party without retaining control or substantially all risks and rewards of the asset.

Where the Group has transferred its right to receive cash fl ows from an asset and has neither transferred nor retained substantially all

the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Group’s continuing

involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of

the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.

A fi nancial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. Where an existing liability

is replaced by another from the same lender on substantially diff erent terms, or the terms of an existing liability are substantially modifi ed,

such an exchange or modifi cation is treated as a derecognition of the original liability and a recognition of a new liability, and the

diff erence in the respective carrying amounts is recognised in profi t and loss.

Financial assets and fi nancial liabilities are off set and the net amount reported in the balance sheet when the Company has a legally

enforceable right to set off the recognised amounts, and intends either to settle on a net basis, or to realise the asset and settle the liability

simultaneously.

20. Banking advances

Advances are stated at amortised cost after the deduction of amounts that, in the opinion of the directors, are required as specifi c and

general impairments. Specifi c impairments are raised for doubtful advances, including amounts in respect of interest not being serviced

and after taking security values into account, and are deducted from advances where the outstanding balance exceeds the value of the

security held. A general impairment based on historic experience is raised to cover doubtful advances, which may not be specifi cally

identifi ed at the balance sheet date. The specifi c and general impairments made during the year are charged to the income statement.

21. Vehicle rental fl eet

Vehicle rental fl eet is stated at cost less accumulated depreciation. Depreciation is provided on a straight-line basis to write off the cost of

the vehicles to their residual value over their estimated useful life of between nine and twelve months.

22. Inventories

Inventories are stated at the lower of cost and estimated net realisable value. Estimated net realisable value is the estimated selling price

in the ordinary course of business, less the estimated costs of completion and selling expenses. The cost of raw materials, fi nished goods,

parts and accessories is determined on either the fi rst in, fi rst out or average cost basis. New vehicles, motorcycles, power and marine

products are stated on an actual unit cost basis. Used and demonstrator vehicles are stated at the lower of actual cost or net realisable

value. The cost of manufactured inventory and work in progress includes materials and parts, direct labour, other direct costs and includes

an appropriate portion of overheads, but excludes interest expense.

Vehicles and vehicle parts purchased in terms of manufacturers’ standard franchise agreements or fl oorplan facilities, are recognised as

assets when received as this is when signifi cant risks and rewards have been transferred. This policy is applied irrespective of the fact

that certain agreements provide that the legal ownership of this inventory shall remain with the supplier or fl oorplan provider until the

purchase price has been paid.

23. Treasury shares

Shares in the Company, held by its subsidiary and the Bidvest Incentive Scheme are classifi ed in the Group’s shareholders’ interest as

treasury shares. These shares are treated as a deduction from the issued and weighted average number of shares. The cost price of the

shares is presented as a deduction from total equity. Distributions received on treasury shares are eliminated on consolidation.

24. Foreign currencies

Transactions in foreign currencies are translated at the rates of exchange ruling at the transaction date. Monetary assets and liabilities in

foreign currencies are translated at the rates of exchange ruling at the balance sheet date. Translation diff erences are recognised in the

income statement.

Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange

rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are

translated to South African rand at foreign exchange rates ruling at the dates that the fair value was determined.


25. Share-based payments

The Bidvest Incentive Scheme grants options to acquire shares in the Company to executive directors and staff . The fair value of options

granted is recognised as an employee expense with a corresponding increase in equity. The fair value is measured at grant date and spread

over the period during which the employees become unconditionally entitled to the options. The fair value of the options is measured

using a binomial method, taking into account the terms and conditions upon which the options were granted. The amount recognised

as an expense is adjusted to refl ect the actual number of share options that vest except where staff are unable to meet the scheme’s

employment requirements.

The Bidvest Incentive Scheme grants loans to staff for the acquisition of shares in the Company. The fair value of services received in return

for shares allotted is measured based on a binomial method taking into account the expected contractual life of the loan obligation.

26. Employee benefi ts

Leave benefi ts due to employees are recognised as a liability in the fi nancial statements.

The Group’s liability for post-retirement benefi ts, accruing to past and current employees in terms of defi ned benefi t schemes, is actuarially

calculated. Where the plan is funded, the obligation is reduced by the fair value of the plan assets. Unfunded obligations are recognised as

a liability in the fi nancial statements.

The Group’s obligation for post-retirement medical aid to past and current employees is actuarially determined and provided for in full.

The projected unit-credit method is used to determine the present value of the defi ned benefi t obligations and the related current service

cost and, where applicable, past service cost.

Actuarial gains or losses in respect of defi ned benefi t plans are recognised in the income statement if the net cumulative unrecognised

actuarial gains and losses at the end of the previous reporting period exceed the greater of:

10% of the present value of the defi ned benefi t obligation at that date, before deducting plan assets; or

10% of the fair value of any plan assets at that date.

However, when the actuarial calculation results in a benefi t to the Group, the recognised asset is limited to the net total of any

unrecognised past service costs and the present value of any future refunds from the plan or reductions in future contributions to the plan.

The amount recognised is the excess in terms of the aforementioned formula, divided by the expected average remaining working lives of

the employees participating in that plan.

Past service costs are recognised as an expense on a straight-line basis over the average period until the benefi ts become vested. To the

extent that the benefi ts have vested, past service costs are recognised immediately.

Liabilities for employee benefi ts which are not expected to be settled within twelve months are discounted using the market yields at the

balance sheet date on high quality bonds with terms that most closely match the terms of maturity of the related liabilities.

Contributions to defi ned contribution pension plans are recognised as an expense in the income statement as incurred.

27. Short-term insurance

Short-term insurance is provided in terms of benefi ts under short-term policies which cover motor, property and warranty. Premiums are

accounted for as income when they come due, before deducting commission. Claims expenses are charged to the income statement as

incurred based on the liability owed to the contract holder at the date of the claim. A provision for unearned premiums is created, based

on the 24th and 48th methods and actual incidence of risk, that represents that part of the current year’s premiums that relate to risk

periods that extend to the following year. Provision is made on a prudent basis for the estimated fi nal cost of all claims that had not been

settled on the accounting date. Provision is also made for claims arising from events that occurred before the close of the accounting

period, but which have not been reported to the Company by that date. A contingency reserve is maintained at 10% of the net written

premiums. The reserve can be utilised in case of catastrophe, subject to the approval of the Financial Services Board. Transfers to this

reserve are refl ected in the capital and reserves note.

Accounting policies


28. Life assurance

Life assurance benefi ts are provided in terms of individual credit life contracts. These contracts are decreasing term assurance designed

to pay outstanding loans provided by fi nancing houses to purchasers of motor vehicles. The outstanding loan is settled (subject to

certain limits) following death or disability of the contract holder. In addition there is a dreaded disease, retrenchment and funeral benefi t.

Premiums consist of single and monthly premiums and are recognised when the insurance risk cover commences. Premiums are shown

before deducting reinsurance and commission. Claims expenses are charged to the income statement as incurred based on the liability

owed to the contract holder at the date of the claim. Policyholder liabilities under insurance contracts, representing the liability in respect

of unmatured policies, are valued in terms of the Financial Soundness Valuation basis contained in Practice Guidance Note 104.

Contracts entered into by the Group with reinsurers under which the Group is compensated for losses on one or more contracts issued

by the Group are classifi ed as reinsurance contracts held. The benefi ts to which the Group is entitled under its reinsurance contracts are

recognised as reinsurance assets. These assets and liabilities consist of short-term balances due to and from reinsurers, as well as longer-

term receivables (classifi ed as reinsurance assets) that are dependent on the expected claims and benefi ts arising under the related

reinsurance contracts. Amounts recoverable from or due to reinsurers are measured consistently with the amounts associated with the

reinsurance contracts and in accordance with the terms of each reinsurance contract. Reinsurance liabilities are primarily premiums

payable and are recognised as an expense when due. The Group assesses its reinsurance assets for impairment on an annual basis. If

there is objective evidence that the reinsurance asset is impaired, the Group reduces the carrying amount of the reinsurance asset to

its recoverable amount and recognises the impairment loss in the income statement. The Group gathers the objective evidence that a

reinsurance asset is impaired using the same process adopted for fi nancial assets held at amortised cost.

29. Provisions

Provisions are recognised when the Group has a legal or constructive obligation as a result of past events, for which it is probable that an

outfl ow of economic benefi ts will occur, and where a reliable estimate can be made of the amount of the obligation. Where the eff ect of

discounting is material, provisions are discounted. The discount rate used is a pre-tax rate that refl ects current market assessments of the

time value of money and, where appropriate, the risks specifi c to the liability.

A provision for restructuring is recognised when the Group has approved a detailed and formal restructuring plan, and the restructuring

has either commenced or has been announced publicly. Future operating costs are not provided for.

The Group recognises a provision calculated as the present value of the estimated cost of dismantling and removing items and restoring

the site in which they are located when the legal or constructive obligation arises or when the damage to the site occurs.

A provision for onerous contracts is recognised when the expected benefi ts to be derived by the Group from a contract are lower than

the unavoidable cost of meeting its obligations under the contract. The provision is measured at the present value of the lower of the

expected cost of terminating the contract and the expected net costs of continuing the contract. Before a provision is established, the

Group recognises any impairment loss on the assets associated with that contract.

30. Segmental reporting

The principal segments of the Group have been identifi ed on a primary basis by the nature of the business and on a secondary basis by

geographic segment. The basis is representative of the internal structure for management purposes.

Segmental result includes revenue and expenses directly relating to a business segment but excludes net fi nance charges and taxation

which cannot be allocated to any specifi c segment. Segmental trading profi t is defi ned as operating profi t excluding items of a capital

nature and is the basis on which management’s performance is assessed.

Segment operating assets and liabilities include property, plant and equipment, investments, inventories, trade and other receivables, trade

and other payables, banking assets and liabilities, insurance funds and post-retirement obligations but exclude cash, borrowings, current

taxation and deferred taxation. Intangible assets are allocated to the cash-generating unit in the segment to which they relate.

31. Reclassifi cations

Capital work in progress, previously included in the various property, plant and equipment categories has been separately disclosed in

order to achieve more appropriate presentation (refer note 13).

To achieve consistent reporting throughout the Group certain operations reconsidered their allocation of expenses within the various

income statement categories. Prior year results have been restated to take account of these reclassifi cations. This restatement has resulted

in an increase in cost of revenue of R217,4 million, an increase in sales and distribution expenses of R160,8 million and a decrease in

administration expenses and other expenses of R6,7 million and R371,5 million respectively.


Note 2007

R’000 2006 R’000

Total revenue 1 95 857 250 77 426 249

Revenue 95 655 509 77 276 491

Cost of revenue (77 330 818) (61 807 227)

Gross income 18 324 691 15 469 264

Other income 419 408 140 331

Operating expenses (14 247 529) (11 918 088)

Sales and distribution expenses (9 432 053) (7 376 156)

Administration expenses (3 940 085) (3 599 715)

Other expenses (875 391) (942 217)

Operating profi t 2 4 496 570 3 691 507

Net fi nance charges 3 (566 181) (342 392)


Finance charges (645 702) (408 688)

Share of profi t of associates 68 354 48 846

Dividends received 9 083 4 991

Share of retained earnings 59 271 43 855

Impairment of investment in associate (178 339) –

Profi t before taxation 3 820 404 3 397 961

Taxation 4 (1 033 248) (933 418)


Attributable to

Shareholders of the Company 2 700 054 2 388 717

Minority shareholders 87 102 75 826

2 787 156 2 464 543

Basic earnings per share (cents) 5 899,4 796,3

Diluted earnings per share (cents) 5 878,3 761,2

Headline earnings per share (cents) 5 970,0 804,6

Diluted headline earnings per share (cents) 5 947,2 769,1

Distributions per share (cents) 6 446,4 369,0

Consolidated income statementfor the year ended June 30


Consolidated statement of recognised income and expensesfor the year ended June 30

2007 R’000

2006 R’000

Net income recognised directly in equity 351 592 365 681

Eff ective movement in foreign currency translation reserve 352 058 364 235

Increase (decrease) in fair value of available-for-sale fi nancial assets, net of taxation (466) 1 446


Total recognised income and expenses for the year 3 138 748 2 830 224

Attributable to

Shareholders of the Company 3 050 706 2 751 739


3 138 748 2 830 224

Details of the movement in capital and reserves is contained in note 25.


Note 2007R’000

2006R’000

Cash fl ow from operating activities 1 378 605 2 352 689

Cash generated by operations 7 4 236 895 4 490 358


Finance charges 8 (552 218) (324 878)

Taxation paid 9 (1 152 174) (863 495)

Distributions to shareholders 10 (1 233 419) (1 015 592)

Cash eff ects of investment activities (3 103 803) (2 368 372)

Amounts advanced to associates (13 876) (687)

Investments disposed of 284 771 293 037

Investments acquired (556 083) (252 886)

Additions to property, plant and equipment (1 982 374) (1 605 371)

Additions to vehicle rental fl eet (733 778) (685 454)

Additions to intangible assets (130 450) (100 965)

Proceeds on disposal of property, plant and equipment 259 200 151 218

Proceeds on disposal of vehicle rental fl eet 599 728 387 203

Proceeds on disposal of intangible assets 8 898 352

Acquisition of businesses, subsidiaries and associates 11 (863 989) (1 155 920)

Proceeds on disposal of interests in subsidiaries and associates, and disposal and closure of businesses 12 24 150 601 101

Cash eff ects of fi nancing activities (335 250) 842 777

Proceeds from share issues 494 094 180 274

Repurchase of treasury shares (1 888 094) (508 810)

Sale of treasury shares 1 188 501 –

Borrowings raised 979 690 1 722 823

Borrowings repaid (1 109 441) (551 510)

Net increase (decrease) in cash and cash equivalents (2 060 448) 827 094

Cash and cash equivalents at beginning of year 2 546 995 1 497 683

Eff ects of exchange rate fl uctuations on cash and cash equivalents 129 918 222 218

Cash and cash equivalents at end of year 616 465 2 546 995

Cash and cash equivalents comprise

Cash and cash equivalents 24 2 374 442 3 255 457

Bank overdrafts included in short-term portion of borrowings 28 (1 757 977) (708 462)

616 465 2 546 995

Consolidated cash fl ow statementfor the year ended June 30


Note 2007

R’000 2006

R’000

ASSETS

Non-current assets 13 037 827 10 606 995

Property, plant and equipment 13 6 732 602 5 511 253

Intangible assets 14 388 145 378 808

Goodwill 15 3 772 297 3 123 722

Deferred taxation 16 431 525 398 411

Interest in associates 18 454 865 574 893

Investments 19 1 031 670 544 923

Banking and other advances 20 226 723 74 985

Current assets 19 806 022 17 387 506

Vehicle rental fl eet 21 527 524 479 326

Inventories 22 6 813 187 5 092 821

Short-term portion of banking and other advances 20 183 983 142 718

Trade and other receivables 23 9 906 886 8 417 184

Cash and cash equivalents 24 2 374 442 3 255 457

Total assets 32 843 849 27 994 501

EQUITY AND LIABILITIES

Capital and reserves 25 10 824 966 9 158 695

Capital and reserves attributable to shareholders of the Company 10 626 509 8 928 995


Non-current liabilities 3 114 180 3 777 646

Deferred taxation 16 265 323 202 907

Life assurance fund 27 50 457 32 795

Long-term portion of borrowings 28 2 229 892 3 093 184

Post-retirement obligations 29 156 582 221 092

Long-term portion of provisions 33 245 757 99 869

Long-term portion of banking liabilities 30 73 278

Long-term portion of operating lease liabilities 31 166 096 127 521

Current liabilities 18 904 703 15 058 160

Trade and other payables 32 14 192 506 12 562 695

Short-term portion of provisions 33 200 375 224 798

Vendors for acquisition 27 007 41 795

Taxation 372 789 501 245

Short-term portion of banking liabilities 30 203 025 113 265

Short-term portion of borrowings 28 3 909 001 1 614 362

Total equity and liabilities 32 843 849 27 994 501

Consolidated balance sheetas at June 30


Notes to the consolidated fi nancial statementsfor the year ended June 30

1. Total revenue

Sale of goods 71 510 747 57 372 616

Rendering of services 8 212 209 7 058 714

Commissions and fees earned 515 886 421 506

Gross billings relating to clearing and forwarding transactions 17 136 630 13 893 019

Insurance 240 141 180 547

Dividend income 39 822 33 292


97 817 354 79 076 160

Inter-group eliminations (1 960 104) (1 649 911)

95 857 250 77 426 249

2. Operating profi t

Determined after charging (crediting):

Auditors’ remuneration 63 131 43 402

Paid to Group auditors in respect of 32 730 25 953

Audit fees 22 243 19 808

Audit related expenses 833 775

Consulting services on acquisitions 5 969 –

Taxation advice 3 632 3 087

Other services 53 2 283

Paid to other auditors in respect of 30 401 17 449

Audit fees 15 762 13 780

Audit related expenses 212 82

Taxation advice 872 723

Internal audit services 559 2 184

Software implementation 11 089 –

Other services 1 907 680

Depreciation of property, plant and equipment 958 651 779 739

Buildings 40 839 25 603

Leasehold premises 46 398 30 178

Plant and equipment 271 686 223 453

Offi ce equipment, furniture and fi ttings 170 079 145 581

Vehicles, vessels and craft 308 357 261 723

Rental assets 90 571 78 921

Capitalised leased assets 6 449 3 955

Full maintenance lease assets 24 272 10 325

Depreciation of vehicle rental fl eet 85 852 68 080

Amortisation of intangible assets 144 285 137 094

Patents, trademarks, tradenames and other intangibles 73 182 67 283

Computer software 71 103 69 811

Impairment of goodwill and other intangibles 65 707 14 174

Goodwill 65 122 9 574

Patents, trademarks, tradenames and other intangibles 585 4 600

Negative goodwill arising on acquisition of subsidiaries included in other income – (3 780)

Impairment of trade receivables 26 053 17 174

2007 R’000

2006 R’000


2. Operating profi t (continued)

Directors’ emoluments

Executive directors 64 199 60 818

Basic remuneration 28 425 30 650

Retirement and medical benefi ts 3 314 3 793

Other benefi ts 5 804 3 365

Cash incentives 26 656 23 010

Non-executive directors 2 030 1 396

Fees 1 794 1 226

Emoluments for other services 236 170

Employer contributions to 621 857 521 884

Defi ned contribution pension funds 203 121 157 115

Provident funds 237 918 172 458

Retirement funds 18 924 39 954

Medical aid funds 161 894 152 357

Expenses related to post-retirement obligations 30 221 35 513

Defi ned benefi t pension plans 37 345 17 103

Post-retirement medical aid obligations (7 124) 18 410

Share-based payment expense 58 083 50 050

Staff 46 225 37 249

Executive directors 10 105 12 515

Former executive directors 1 753 286

Staff costs excluding directors’ emoluments and employer contributions 9 191 058 7 641 659

Fees for administrative, managerial and technical services 1 363 7 130

Foreign exchange losses (gains) (12 546) (16 398)

Realised (11 522) (20 445)

Unrealised (1 024) 4 047

Dividends received (30 739) (28 301)

Listed investments (23 793) (14 213)

Unlisted investments (6 946) (14 088)

Fair value adjustments on investments held-for-trading (214 630) (45 577)

Net capital profi ts (15 493) (44 901)

Profi t on disposal of property, plant and equipment (15 409) (15 689)

Profi t on closure and disposal of businesses (84) (29 212)

JSE Limited fees 177 128

Operating lease charges 1 170 365 812 874

Land and buildings 901 917 616 301

Equipment and vehicles 268 448 196 573

2007 R’000

2006 R’000



3. Net fi nance charges


Preference dividends 8 163 7 591

Interest income on banking and other advances 25 017 15 440

Interest income on vehicle lease debtors 14 964 3 250

Interest income on bank balances 112 068 88 157

Interest income on unimpaired available-for-sale fi nancial assets 1 707 2 028

Finance charges (675 680) (432 607)

Interest expense on banking liabilities (29 823) (23 688)

Interest expense on bank overdrafts (405 524) (207 022)

Interest expense on fi nanced assets (10 238) (7 524)

Interest expense on vehicle lease creditors and fl oorplan creditors (49 491) (25 148)

Interest expense on other borrowings (181 845) (179 072)

Less borrowing costs capitalised to property, plant and equipment 1 241 9 847

(513 761) (316 141)

Less net fi nance income from banking operations included in operating profi t (52 420) (26 251)

Income (82 398) (50 170)

Charges 29 978 23 919

(566 181) (342 392)

The applicable weighted average interest rate is used to determine the amount of borrowing costs

eligible for capitalisation.

4. Taxation

Current taxation 1 006 713 910 653

Current year 1 032 322 924 111

Prior years (25 609) (13 458)

Deferred taxation 21 884 17 880

Current year 27 246 27 019

Prior years (4 681) (9 139)

Change in rate of taxation (681) –

Secondary taxation on companies 4 492 3 585

Foreign withholding taxes 159 1 300

Total taxation per income statement 1 033 248 933 418

Comprising

South African normal taxation 761 441 638 612

Foreign taxes 271 807 294 806

1 033 248 933 418

2007 R’000

2006 R’000


4. Taxation (continued)

The reconciliation of the eff ective tax rate with the company tax rate is:

Taxation for the year as a percentage of profi t before taxation 27,0 27,5

Secondary taxation on companies (0,1) (0,1)

Eff ective rate excluding secondary taxation on companies 26,9 27,4

Dividend and exempt income 2,1 1,1

Foreign taxation 1,9 0,9

Expenses not taxable or allowed (3,0) (1,6)

Utilisation of deferred tax assets not previously raised 0,3 0,8

Capital gains taxation exempt portion – (0,3)

Changes in prior years’ estimation 0,8 0,7

Rate of South African company taxation 29,0 29,0

2007R’000

2006 R’000

Estimated tax losses available for set-off against future taxable income 613 127 487 642

Utilised in the computation of deferred taxation (287 336) (145 660)

Not accounted for in deferred taxation 325 791 341 982

Deferred tax assets have not been recognised in respect of these tax losses because it is notprobable that the relevant companies will generate taxable profi t in the near future, against which the benefi ts can be utilised.

Secondary taxation on companies – dividend credits available 166 804 108 987

5. Earnings per share

Weighted average number of shares (‘000)

Weighted average number of shares in issue for basic earnings per share and headline earnings per share 300 206 299 976

Potential dilutive impact of outstanding staff share options 7 215 7 213

Number of outstanding staff share options 19 126 18 886

Number of share options deemed to be issued at fair value (11 911) (11 673)

Potential dilutive impact of outstanding shareholder options – 6 637

Number of outstanding shareholder options – 18 000

Number of shareholder options deemed to be issued at fair value – (11 363)

Adjusted weighted average number of shares in issue used for the calculation of diluted earnings per share 307 421 313 826

Attributable earnings (R’000)

Basic earnings per share and diluted earnings per share are based on profi t attributable to shareholders of the Company 2 700 054 2 388 717

Basic earnings per share (cents) 899,4 796,3

Diluted earnings per share (cents) 878,3 761,2

Dilution (%) 2,3 4,4

2007 %

2006%



5. Earnings per share (continued)

Headline earnings (R’000)

Profi t attributable to shareholders of the Company 2 700 054 2 388 717

Impairment of goodwill and intangible assets 65 707 14 174

Net loss on disposal of interests in subsidiaries and associates, and disposal and closure of businesses 595 19 951

Profi t on disposal and closure (84) (29 212)

Tax charge 679 49 638

Minority shareholders – (475)

Net profi t on disposal of property, plant and equipment (12 835) (11 915)

Profi t on disposal (15 409) (15 689)

Tax charge 1 984 3 774

Minority shareholders 590 –

Negative goodwill – (2 457)

Arising on acquisition of subsidiaries – (3 780)

Minority shareholders – 1 323

Impairment of investment in associate 178 339 –

Share of capital items in associates (19 874) 5 059

Headline earnings 2 911 986 2 413 529

Headline earnings per share (cents) 970,0 804,6

Diluted headline earnings per share (cents) 947,2 769,1

Dilution (%) 2,3 4,4

6. Distributions per share

Interim distribution (cents)

Refund of share premium per share in lieu of dividend paid on April 2 2007 (2006: paid on March 27 2006) 198,0 162,0

Final distribution (cents)

Refund of share premium per share in lieu of dividend payable on September 25 2007 (2006: paid on October 2 2006) 248,4 207,0

446,4 369,0

2007 2006


7. Cash generated by operations

Profi t before taxation 3 820 404 3 397 961

Net fi nance charges 566 181 342 392

Share of retained earnings and impairment of associates 119 068 (43 855)

Adjustment for depreciation and other non-cash items 1 083 040 954 879

Increase (reduction) in post-retirement obligations (66 555) 16 943

Increase in life assurance fund 17 662 19 530

Utilised to fi nance working capital (1 302 905) (197 492)

Increase in inventories (1 196 186) (708 058)

Increase in trade and other receivables (826 294) (796 580)

Increase in banking and other advances (193 003) (70 524)

Increase in trade and other payables and provisions 823 023 1 358 750

Increase in banking liabilities 89 555 18 920

Cash generated by operations 4 236 895 4 490 358

8. Finance charges

Charge per income statement (645 702) (408 688)

Amounts capitalised to borrowings 93 484 83 810

Amounts paid (552 218) (324 878)

9. Taxation paid

Amounts payable at beginning of year (501 245) (448 242)

Per income statement (1 011 364) (915 538)

Businesses acquired (4 479) 4 964

Businesses disposed of – 5 487

Exchange rate adjustments (7 875) (11 411)

Amounts payable at end of year 372 789 501 245

Amounts paid (1 152 174) (863 495)

10. Distributions to shareholders

Refund of share premium to shareholders in lieu of dividend (1 326 028) (1 074 023)

Refund of share premium received by subsidiary on treasury shares 120 395 81 615

Dividends paid to minority shareholders by subsidiaries (27 786) (23 184)

Amounts paid (1 233 419) (1 015 592)

2007 R’000

2006 R’000



11. Acquisition of businesses, subsidiaries and associates

Property, plant and equipment (222 647) (729 903)

Deferred taxation 4 146 (28 822)

Interest in associates (10 301) (3 404)

Investments and advances – (11 851)

Inventories (410 438) (308 258)

Trade and other receivables (373 069) (910 795)

Cash and cash equivalents (59 349) (50 454)

Post-retirement obligations (3 835) 592

Borrowings 227 326 32 993

Trade and other payables and provisions 567 474 1 430 586

Taxation 4 479 (4 964)

Net fair value of tangible assets (276 214) (584 280)

Goodwill (515 568) (591 227)

Intangible assets (24 845) (86 133)

Minority shareholders (91 642) 13 471

Total value of acquisitions (908 269) (1 248 169)

Less cash and cash equivalents acquired 59 349 50 454

Vendors for acquisition at beginning of year (41 795) –

Exchange rate adjustments (281) –

Vendors for acquisition at end of year 27 007 41 795

Net amounts paid (863 989) (1 155 920)

Pre-acquisition carrying amounts are determined based on applicable IFRS immediately before the acquisition. The pre-acquisition carrying amounts approximated the amounts recognised on acquisition date with the exception of the following: trade receivables in respect of the Angliss Asia Group acquisition was impaired by R6,1 million to the recoverable value; and the recognition of an intangible asset equal to the fair value of distribution rights of R9,6 million in respect of the acquisition of Inyanga Motors. The values of assets, liabilities and contingent liabilities recognised on acquisition are their estimated fair values (refer note 39 for methods used in determining fair values).

With eff ect from May 8 2007 the Group acquired 100% of Angliss Asia Group, a leading foodservice wholesaler for R513,9 million, satisfi ed in cash. During the period from date of acquisition, the business contributed R370,7 million to revenue and R10,8 million to operating profi t. Had the acquisition occurred on July 1 2006, the business would have contributed R2,2 billion to revenue and R42,2 million to operating profi t for the year.

Goodwill of R330,9 million arose on this acquisition as a result of the potential that management believed the business has, as well as the benefi ts that the Group will bring to the business that were not previously available to it. Furthermore the acquisition of Angliss complemented the existing Bidvest Asia Pacifi c operations as well as assisting the Group in realising synergies in the area of product sourcing between countries.

Several less signifi cant acquisitions were also made during the course of the year. Goodwill arose on these acquisitions as the anticipated value of future cash fl ows that were taken into account in determining the purchase consideration exceeded the net assets acquired at fair value. Furthermore these acquisitions have enabled the Group to expand its range of complementary products and services and, as a consequence have broadened the Group’s base in the market place.

These acquisitions contributed R577,3 million to revenue and R17,2 million to operating profi t for the year and would have contributed R1,3 billion to revenue and R4,2 million to operating profi t had the acquisitions been made with eff ect from July 1 2006.

2007 R’000

2006 R’000


12. Proceeds on disposal of interests in subsidiaries and

associates, and disposal and closure of businesses

Property, plant and equipment – 459 365

Intangible assets – 2 268

Goodwill – 198 949

Deferred taxation – (33 801)

Interest in associates 24 066 (33 264)

Inventories – 97 591

Trade and other receivables – 310 982

Cash and cash equivalents – 34 945

Post-retirement obligations – (17 804)

Borrowings – (26 662)

Trade and other payables and provisions – (358 095)

Taxation – (5 487)

Net fair value of tangible assets 24 066 628 987

Minority shareholders – (1 591)

Realisation of foreign currency translation reserves – (20 562)

Profi t on disposal of interests in subsidiaries and associates, and disposal and closure of businesses 84 29 212

Less cash and cash equivalents disposed of – (34 945)

Net proceeds 24 150 601 101

The only disposals during the current year were disposals of interests in associates and reductions of shareholdings in subsidiaries.

2007 R’000

2006 R’000



13. Property, plant and equipment

Freehold land and buildings 1 911 592 1 561 538

Cost 2 332 074 1 916 110

Accumulated depreciation (420 482) (354 572)


Cost 902 352 713 304


Plant and equipment 1 638 440 1 316 356

Cost 3 346 619 2 729 548

Accumulated depreciation (1 708 179) (1 413 192)


Cost 1 612 495 1 353 234

Accumulated depreciation (1 046 568) (918 140)

Vehicles, vessels and craft 1 383 735 1 153 301

Cost 3 090 883 2 730 292

Accumulated depreciation (1 707 148) (1 576 991)


Cost 476 104 448 179



Cost 44 895 44 754


Full maintenance leased assets 120 101 62 674

Cost 145 590 72 999


Capital work in progress 251 421 251 258

6 732 602 5 511 253

Property, plant and equipment with an estimated carrying value of R195 161 000 (2006: R115 041 000) were pledged as security for borrowings of R88 340 000 (2006: R90 256 000) (refer note 28).

A register of land and buildings is available for inspection by members at the registered offi ce of the Company.

Capital work in progress, previously included in the various property, plant and equipment categories, has been separately disclosed in order to achieve more appropriate presentation. Comparative amounts were reclassifi ed for consistency, which resulted in R251 258 000 being reclassifi ed from the existing categories to the capital work in progress category.

2007 R’000

2006 R’000


13. Property, plant and equipment (continued)

Movement in property, plant and equipment

Carrying value at beginning of year 5 511 253 4 303 123

Capital expenditure 1 982 374 1 605 371

Freehold land and buildings 348 596 182 935






Capitalised leased assets 195 1 559

Full maintenance lease assets 102 159 72 999

Capital work in progress (15 274) 17 658

Expenditure 482 685 288 911

Transfers to other categories (497 959) (271 253)

Acquisition of businesses 222 647 729 903


Leasehold premises 40 450 –




Capitalised leased assets 465 16 302


Disposals (243 791) (135 529)

Freehold land and buildings (82 532) (41 875)

Leasehold premises (14 773) (5 245)

Plant and equipment (20 382) (13 584)

Offi ce equipment, furniture and fi ttings (19 494) (7 648)

Vehicles, vessels and craft (72 396) (45 642)

Rental assets (9 113) (21 535)

Capitalised leased assets (4 640) –

Full maintenance lease assets (20 461) –

Disposal of businesses – (459 365)

Freehold land and buildings (80 840)

Leasehold premises (69 207)

Plant and equipment (19 109)

Offi ce equipment, furniture and fi ttings (18 732)

Vehicles, vessels and craft (269 981)

Capitalised leased assets (58)

Capital work in progress (1 438)

Exchange rate adjustments 218 770 247 489






Rental assets (35) –



Depreciation (refer note 2) (958 651) (779 739)

Carrying value at end of year 6 732 602 5 511 253

2007 R’000

2006 R’000



14. Intangible assets


Cost 961 512 874 837

Accumulated amortisation (725 150) (639 524)


Cost 453 065 380 916

Accumulated amortisation (301 282) (237 421)

388 145 378 808

Movement in intangible assets

Carrying value at beginning of year 378 808 321 246

Additions 130 450 100 965





Computer software 495 8 627

Disposals (9 483) (352)

Patents, trademarks, tradenames and other intangibles (8 912) (211)

Computer software (571) (141)


Patents, trademarks, tradenames and other intangibles (509)

Computer software (1 759)




Amortisation and impairments (refer note 2) (144 870) (141 694)

Patents, trademarks, tradenames and other intangibles (73 767) (71 883)

Computer software (71 103) (69 811)

Carrying value at end of year 388 145 378 808

The amortisation and impairment charges are included in other expenses in the income statement.

2007 R’000

2006 R’000


15. Goodwill

Carrying amount 3 857 349 3 143 587

Accumulated impairment (85 052) (19 865)

3 772 297 3 123 722

Movement in goodwill

Carrying value at beginning of year 3 123 722 2 530 700



Impairment of goodwill (65 122) (9 574)


Carrying value at end of year 3 772 297 3 123 722

Goodwill acquired through business combinations has been attributed to individual cash-generating units. The carrying amount of goodwill was subject to an annual impairment test as at March 31 using either the discounted cash fl ow basis or at fair value less costs to sell method. An amount of R65,1 million (2006: R9,6 million) was identifi ed as being impaired for the current fi nancial year.

The most signifi cant portion of the Group’s goodwill, R3,0 billion (2006: R2,5 billion), relates to operations in Bidvest Europe and Bidvest Asia Pacifi c. The recoverable amount of each cash-generating unit within these divisions was determined using the fair value less costs to sell method and exceeds the carrying value by some R5,3 billion. These calculations use projected annualised earnings based on actual operating results. A price earnings ratio was applied to obtain the recoverable amount for each business unit. The earning yields are considered to be consistent with similar companies within the industry and geographic segments. Attributable earnings for these divisions amounted to R798,7 million (2006: R555,8 million) for the year.

The remaining goodwill of R0,8 billion (2006: R0,6 billion) is allocated across multiple cash-generating units. The recoverable amount for these remaining units was calculated on the aforementioned basis. For those units where the carrying amount was in excess of the recoverable amount, an impairment was recognised.

Included in the impairment of R65,1 million, is R41,6 million in respect of the security services businesses within the Bidserv division. The impairment arose as a result of the continuing pressures being experienced within our security businesses and the diffi culties in passing on increasing wage costs to customers.

16. Deferred taxation

Deferred tax assets 431 525 398 411

Deferred tax liabilities (265 323) (202 907)

Net deferred tax asset 166 202 195 504

Movement in deferred tax assets and liabilities

Balance at beginning of year 195 504 134 122

Per income statement (21 884) (17 880)

Items recognised directly in equity 190 (591)

Arising on acquisition or disposal of businesses (4 146) 62 623

Exchange rate adjustments (3 462) 17 230

Balance at end of year 166 202 195 504

2007 R’000

2006 R’000



16. Deferred taxation (continued)

Temporary diff erences

2007

Diff erential between carrying values and tax values of property, plant and equipment (52 243) (258 607) (310 850)

Diff erential between carrying values and tax values of intangible assets 1 057 (1 130) (73)

Tax losses 77 589 4 541 82 130

Leave pay liability 32 978 59 472 92 450

Post-retirement obligations 23 884 62 838 86 722

Operating lease liabilities 34 407 34 407 68 814

Staff -related liabilities 56 214 96 015 152 229

Other items 257 639 (262 859) (5 220)

431 525 (265 323) 166 202

2006

Diff erential between carrying values and tax values of property, plant and equipment (122 644) (93 238) (215 882)

Diff erential between carrying values and tax values of intangible assets (13 361) (3 050) (16 411)

Tax losses 21 355 11 969 33 324

Leave pay liability 47 161 30 840 78 001

Post-retirement obligations 59 976 25 880 85 856

Operating lease liabilities 33 694 11 402 45 096

Staff -related liabilities 118 623 3 282 121 905

Other items 253 607 (189 992) 63 615

398 411 (202 907) 195 504

Other items consist of various individually insignifi cant amounts.

Deferred taxation has been provided at rates ranging between 23% – 35%. The variance in rates arises as a result of the diff ering tax rates present in the various countries in which the Group operates.

2007 R’000

2006 R’000

17. Interest in joint ventures

The Group’s proportional interest in joint ventures has been incorporated in the Group’s assets, liabilities and results, as follows:

Income statement

Revenue 226 260 197 757

Operating profi t 7 298 7 787

Net fi nance charges (1 844) (2 050)

Profi t before taxation 5 454 5 737

Taxation (1 650) (1 979)

Profi t for the year 3 804 3 758

Balance sheet

Assets

Property, plant and equipment and intangible assets 9 040 10 778


Net current assets 25 421 6 729

35 924 18 937

Equity and liabilities

Capital and reserves 11 422 8 726

Borrowings 24 502 10 211

35 924 18 937

Details of major joint ventures are refl ected on page 191 of this report.

AssetsR’000

LiabilitiesR’000

NetR’000


18. Interest in associates

Listed investments 203 144 385 267

Fair value at acquisition 39 241 209 337

Goodwill 163 903 175 930

Unlisted investments 64 888 67 533

Fair value at acquisition 54 471 57 642

Goodwill 10 417 9 891

Investments in associates at cost 268 032 452 800

Attributable share of post-acquisition retained reserves of associates 143 732 92 868

At beginning of year 92 868 49 215

Share of retained income 59 271 43 855

Share of foreign currency translation reserve (1 072) –

Reversal of prior year on becoming subsidiary, disposal or change in shareholding (7 335) (202)

Advances 43 101 29 225

454 865 574 893

The Group’s interest in Tiger Wheels Limited of R178,3 million was fully impaired as a result of its suspension on the Johannesburg Stock Exchange following the announcement that its 74%-owned subsidiary ATS Beteiligungs GmbH was unable to gather support from its funders to continue operating.

Advances to associates bear interest at rates of between 0% and 14% and have no fi xed terms of repayment.

Market value of listed associates 612 302 479 221

Directors’ valuation of unlisted associates 205 138 133 845

817 440 613 066

Summarised fi nancial information of associates (aggregated):

Income statement

Revenue 4 056 173 4 533 617

Operating profi t 290 187 343 917

Net fi nance charges (5 257) (31 444)

Profi t before taxation 284 930 312 473

Taxation (45 147) (69 817)

Profi t for the year 239 783 242 656

Balance sheet

Assets

Property, plant and equipment and intangible assets 691 436 1 517 824

Investments 62 665 27 750

Net current assets 349 558 500 642

1 103 659 2 046 216

Equity and liabilities

Capital and reserves 853 222 1 574 178


Borrowings 218 956 432 447

1 103 659 2 046 216

Details of major associates are refl ected on page 191 of this report.

2007 R’000

2006 R’000



19. Investments

Held-for-trading

Listed 744 085 309 976

Unlisted 271 514 218 217

Available-for-sale

Listed 16 071 16 730

1 031 670 544 923

Included in listed investments are interest bearing, listed bonds which amount to R32 629 000 (2006: R24 495 000), with coupon interest rates of between 10,7% to 13,5% and mature in one to eight years. These bonds may be realised prior to their maturity dates.

A register of investments is available for inspection by members at the registered offi ce of the Company.

20. Banking and other advances

Instalment fi nance 26 711 39 141

Mortgages 1 191 1 503

Other 399 964 195 658

427 866 236 302

Less impairments (17 160) (18 599)

410 706 217 703

Maturity analysis

Maturing in one year 183 983 142 718

Maturing after one year but within fi ve years 225 804 73 966

Maturing after fi ve years 919 1 019

410 706 217 703

Interest rates are based on contractual agreements with customers.

21. Vehicle rental fl eet

Cost 583 385 512 576


527 524 479 326

Movement in vehicle rental fl eet

Carrying value at beginning of year 479 326 249 155

Additions 733 778 685 454

Disposals (599 728) (387 203)

Depreciation (85 852) (68 080)

Carrying value at end of year 527 524 479 326

22. Inventories

Raw materials 189 187 161 522

Work in progress 89 847 61 291

Finished goods 4 316 079 3 184 216

New vehicles and motor cycles 879 260 681 177

Used vehicles 550 352 425 532

Demonstration vehicles 513 631 394 968

Power and marine products 83 026 30 135

Parts and accessories 191 805 153 980

6 813 187 5 092 821

2007 R’000

2006 R’000


22. Inventories (continued)

Demonstration vehicles and used vehicles are leased in terms of a rental agreement, with a right of fi rst refusal to repurchase the vehicles at the end of the rental period. In the

majority of the cases this option is taken up and, consequently, these vehicles are disclosed with inventory. The total value of vehicles leased amounts to 29 251 18 285

Amounts included in borrowings relating to these assets (refer note 28) 29 251 18 285

Ownership of inventory, acquired under fl oorplan arrangements, remains with the respective fl oorplan provider until the purchase price has been paid

Amounts included in borrowings relating to these assets (refer note 28) 449 337 202 496

Amounts included in trade and other payables relating to these assets (refer note 32) 775 927 355 971

1 225 264 558 467

Write down of inventory charged to income statement 140 116 60 274

23. Trade and other receivables

Trade receivables 9 155 520 7 564 654

Trade receivables due from related parties 7 471 9 504

9 162 991 7 574 158

Impairment adjustment (288 814) (234 873)

Total trade receivables 8 874 177 7 339 285

Prepayments and other receivables 1 032 709 1 077 899

9 906 886 8 417 184

The majority of trade and other receivables is fi xed in the subsidiaries’ local currency. Since trade and other receivables have limited exposure to exchange rate fl uctuations, a currency analysis has not been included.

24. Cash and cash equivalents

Cash on hand and at bank 2 279 442 3 160 457

Variable rate redeemable cumulative preference shares earning dividends at rates of between 61,5% and 80,0% of prime overdraft rate, subject to redemption and/or repurchase on

30 days’ notice. 95 000 95 000

2 374 442 3 255 457

Amounts included in cash and cash equivalents relating to banking and insurance subsidiaries where the balances form part of the reserving requirements as required

by the Financial Services Act. 318 970 350 189

25. Capital and reserves

Share capital

Authorised

540 000 000 (2006: 540 000 000) ordinary shares of 5 cents each 27 000 27 000

Number Number

Issued

Number of shares issued 330 753 967 325 178 398

Balance at beginning of year 325 178 398 320 421 750

Shares issued in terms of the share incentive scheme 5 575 569 4 756 648

Less shares held by subsidiary as treasury shares (27 902 182) (26 024 016)

Balance at beginning of year (26 024 016) (21 001 198)

Net repurchase of shares by subsidiary (1 878 166) (5 022 818)

Net shares in issue 302 851 785 299 154 382

2007 R’000

2006 R’000



25. Capital and reserves (continued)

Share capital (continued)

Issued share capital 16 538 16 259


Shares issued in terms of share incentive scheme 279 238

Share premium 1 863 743 2 695 956


Arising on shares issued in terms of share incentive scheme 493 815 180 217

Refunds of share premium to shareholders in lieu of dividends (1 326 028) (1 074 023)

Share issue expenses – (181)

Non-distributable and other reserves 1 340 506 924 770

Foreign currency translation reserve 1 158 151 807 033


Realisation of reserve on disposal of subsidiaries – (20 562)

Arising during current year 351 118 361 576

Statutory reserves 16 691 10 013


Transfer from retained earnings 6 678 3 974

Equity-settled share-based payment reserve 165 664 107 724



Distributable reserve

Retained earnings 9 453 517 6 760 607


Change in fair value of available-for-sale fi nancial assets (466) 1 446

Profi t attributable to shareholders of the Company 2 700 054 2 388 717

Transfer to statutory reserves (6 678) (3 974)

12 674 304 10 397 592

Less shares held by subsidiary as treasury shares (2 047 795) (1 468 597)

Share capital (1 395) (1 301)

Balance at beginning of year (1 301) (1 050)

Sale of shares by subsidiary 1 002 –

Repurchase of shares by subsidiary (1 096) (251)

Share premium (2 046 400) (1 467 296)

Balance at beginning of year (1 467 296) (1 040 352)

Proceeds on sale of shares by subsidiary 1 187 499 –

Cost of shares repurchased by subsidiary (1 886 998) (508 559)

Refunds of share premium received by subsidiary on treasury shares 120 395 81 615

Capital and reserves attributable to shareholders of the Company 10 626 509 8 928 995

2007 R’000

2006 R’000


25. Capital and reserves (continued)

Minority shareholders


Share of recognised income and expenses 88 042 78 485

Dividends and capitalisation issues (27 786) (23 184)

Share of movement in equity-settled share-based payment reserve 143 154

Changes in shareholding (91 642) 687

198 457 229 700

Total capital and reserves comprise

Amounts attributable to shareholders of the Company 10 626 509 8 928 995

Amounts attributable to minority shareholders 198 457 229 700

10 824 966 9 158 695

Retained earnings comprise

Company and subsidiaries 9 298 500 6 661 330

Joint ventures 10 213 6 409

Associates 144 804 92 868

9 453 517 6 760 607

30 000 000 of the unissued ordinary shares are under the control of the directors until the next annual general meeting.

Foreign currency translation reserveThe translation reserve comprises all foreign exchange diff erences arising from the translation of the fi nancial statements of foreign operations.

Statutory reservesA contingency reserve is maintained at 10% of the net premium income. The reserve can be utilised in the case of a catastrophe, subject to the approval of the Financial Services Board.

A statutory reserve is maintained by a banking subsidiary to meet the minimum general provision against advances as prescribed by the Banks Act.

Equity-settled share-based payment reserveThe equity-settled share-based payment reserve includes the fair value of the options granted to executive directors and staff which have been recognised over the vesting period at fair value with a corresponding expense to the income statement.

26. Share-based payments

The Bidvest Share Incentive Scheme (“Scheme”) grants options and advances loans to employees of the Group to acquire shares in the Company. Both the share options scheme and share purchase scheme have been classifi ed as equity-settled schemes and, therefore an equity-settled share-based payment reserve has been recognised.

Share options schemeThe Group elected to account only for the cost of options granted subsequent to November 7 2002 which had not vested by January 1 2005 in terms of the transitional provisions on conversion to IFRS.

The terms and conditions of the options are:

Option holders are only entitled to exercise their options if they are in the employment of the Group in accordance with the terms referred to hereafter, unless otherwise recommended by the Board of the Company.

2007 R’000

2006 R’000


26. Share-based payments (continued)

Option holders in the Scheme may exercise the options at such times as the option holder deems fi t, but not so as to result in the following proportions of the holder’s total number of instruments being purchased prior to: 50% of total number of instruments at the expiry of three years; 75% of total number of instruments at the expiry of four years; and 100% of total number of instruments at the expiry of fi ve years from the date of the holder’s acceptance of an option. All options must be exercised no later than the tenth anniversary on which they were granted unless approval is obtained from the trustees.

The number and weighted average exercise prices of share options are:

2007 2006

Number

Average price

R Number

Average price

R

Beginning of year 18 885 909 49,17 24 291 760 46,30

Granted – – 280 000 89,86

Lapsed (368 433) 46,77 (929 203) 41,70

Exercised (3 766 652) 41,86 (4 756 648) 37,94

End of year 14 750 824 51,10 18 885 909 49,17

The options outstanding at June 30 2007 have an exercise price in the range of R23,25 to R90,05 and a weighted average contractual life of 2,0 to 8,5 years.

Share options outstanding at June 30 2007 by year of grant are:

2002 and prior 3 773 160 40,49 5 645 228 40,12

2003 2 881 504 38,79 3 961 021 38,51

2004 3 976 810 50,17 5 046 260 49,92

2005 3 849 350 68,94 3 953 400 68,93

2006 270 000 89,85 280 000 89,86

14 750 824 51,10 18 885 909 49,17

The fair value of services received in return for shares allotted is measured based on a binomial method. The contractual life of the option is used as an input into this model.

The fair value of the shares allotted during the prior year and the assumptions used were:

2006

Fair value at measurement date (Rand) 19,95 – 21,84

Exercise price (Rand) 83,15 – 91,65

Expected volatility (%) 24,60 – 24,67

Option life (years) 3,50 – 5,50

Distribution yield (%) 3,36 – 3,57

Risk-free interest rate (based on national government bonds) (%) 7,52 – 7,94

The volatility is based on the historic volatility and is not expected to diff er materially from the expected volatility.



26. Share-based payments (continued)

Share purchase schemeIn terms of the share purchase scheme, the Scheme advances loans to employees to acquire shares in the Company. Interest is charged on the loans at interest rates determined by the Board of directors of the Company, the loans must be settled no later than the tenth anniversary on which the shares were allotted and the shares are held by the Scheme as security for the loans.

The employees are entitled to settle the loans at such times as they deem fi t, but not so as to result in the following proportions of the employees’ total number of allotted shares being paid for prior to: 50% of total number of allotted shares at the expiry of three years; 75% of total number of allotted shares at the expiry of four years; and 100% of total number of allotted shares at the expiry of fi ve years from the date of the holder’s acceptance of the allotted share, unless otherwise determined by the Board.

Options acquired, valid for 3, 4 or 5 years, by the Trust to buy back shares are off set against share premium. No options were acquired during the period.

Distributions arising on the allotted shares are utilised to settle any interest or income tax obligations with any excess being applied to settle the outstanding liability.

The number and weighted average exercise prices of shares allotted in terms of the share purchase scheme are:

2007

Number

Average price

R

Beginning of year –

Allotted 4 423 000 110,51

Repurchased (48 050) 108,02

End of year 4 374 950 110,07

The fair value of services received in return for shares allotted is measured based on a binomial method. The expected contractual life of the loan obligation is used as an input into this model.

The fair value of the shares allotted during the year and the assumptions used are:

2007

Fair value at measurement date (Rand) 108,54 – 126,00

Price on date of allotment (Rand) 108,54 – 126,00

Expected volatility (%) 25,89 – 26,22

Expected life (years) 3,00 – 5,00

Distribution yield (%) 2,89 – 3,04

Risk-free interest rate (based on national government bonds) (%) 8,16 – 8,73

The volatility is based on the historic volatility and is not expected to diff er materially from the expected volatility.



27. Life assurance fund

The assurance fund at June 30 agrees with the amount of the actuarial value of liabilities under life insurance policies and contracts at that date.

Net assurance fund at beginning of year 32 795 13 265

Gross 41 994 21 410

Reinsurer’s share (9 199) (8 145)

Transfer from income statement 17 662 19 530

Gross 20 302 20 584

Reinsurer’s share (2 640) (1 054)

Net assurance fund at end of year 50 457 32 795

28. Borrowings

Loans secured by mortgage bonds over fi xed property (refer note 13) 9 626 10 014

Loans secured by lien over certain property, plant and equipment in terms of fi nancial leases and suspensive sale agreements (refer note 13) 78 714 80 242

Unsecured loans 3 813 988 3 688 047

Vehicle lease creditors secured by pledge of inventories (refer note 22) 29 251 18 285

Floorplan creditors secured by pledge of inventories (refer note 22) 449 337 202 496

Borrowings 4 380 916 3 999 084

Bank overdrafts 1 757 977 708 462

Total borrowings 6 138 893 4 707 546

Short-term portion of borrowings (3 909 001) (1 614 362)

Long-term portion of borrowings 2 229 892 3 093 184

Schedule of repayment of borrowings

Year to June 2007 905 900

Year to June 2008 2 151 024 1 806 696

Year to June 2009 1 226 278 720 200

Year to June 2010 423 037 80 631

Year to June 2011 25 598 –

Year to June 2017 531 629 485 657

Thereafter 23 350 –

4 380 916 3 999 084

Borrowings comprise

Borrowings of local subsidiaries 2 200 742 1 834 354

Borrowings of foreign subsidiaries 2 180 174 2 164 730

4 380 916 3 999 084

% %

Eff ective weighted average rate of interest on

Local borrowings 9,7 9,7

Foreign borrowings 5,5 4,8

2007 R’000

2006 R’000


28. Borrowings (continued)

Terms and debt repayment schedule

Terms and conditions of outstanding loans were:

Currency

Nominalinterest rate

%Year of

maturityCarrying

valueCarrying

value

Borrowings of local subsidiaries 2 200 742 1 834 354

Loans secured by mortgage bonds over fi xed property 11,5 2008 9 626 232

Loans secured by lien over certain property, plant and equipment in terms of fi nancial leases and suspensive

sale agreements 8,6 – 18,0 2010 – 2016 12 322 –

Unsecured loans 6,0 – 16,0 2008 – 2017 1 700 206 1 613 341

Vehicle lease creditors secured by pledge of inventories 11,0 2008 29 251 18 285

Floorplan creditors secured by pledge of inventories 11,0 – 11,5 2008 449 337 202 496

Borrowings of foreign subsidiaries 2 180 174 2 164 730

Loans secured by lien over certain property, plant and equipment in terms of fi nancial leases and suspensive

sale agreements Sterling 2,0 – 7,0 2008 – 2046 47 241 78 261

Euro 6,0 2012 14 393 –

Other 3,0 – 24,0 2008 – 2014 4 758 12 161

Unsecured loans Euro 5,0 2010 927 811 1 161 314

Australian $ 6,0 2009 907 276 329 093

Hong Kong $ 4,0 2008 125 512 –

Singapore $ 4,0 2008 79 966 –

New Zealand $ 9,0 2008 44 225 –

Sterling 6,0 2009 21 270 566 477

Other 8,0 2008 7 722 17 424

Total interest bearing borrowings 4 380 916 3 999 084

The expected maturity dates are not expected to diff er from the contractual maturity dates.

2007 R’000

2006 R’000



29. Post-retirement obligations

Total unfunded pension liability (pension fund asset) (4 081) 22 474

Post-retirement medical aid obligations 160 663 198 618

156 582 221 092

Pension and provident fundsThe Group provides retirement benefi ts for its permanent employees through pension funds with defi ned benefi t and defi ned contribution categories. The major defi ned benefi t pension funds are the Bidcorp Group Pension Fund, McCarthy Group 1977 Pension Fund, Jacobs Pension Fund and Angliss Hong Kong Foodservice Limited Retirement Fund, which was acquired on acquisition of the Angliss business during the current year. During the prior year the Ropner Pension Fund was disposed of with the sale of the Dartline business. Defi ned contribution provident funds include the Bidcorp Group Provident Fund and the Rennies Group Provident Fund; or appropriate industry funds.

There are also a number of small funds within various employers of the Group. All funds are administered independently of the Group and are subject to the relevant pension fund legislation.

Employer contributions are set out in note 2.

Summarised details of the Bidcorp Group Pension Fund, McCarthy Group 1977 Pension Fund, Jacobs Pension Fund and Angliss Hong Kong Foodservice Limited Retirement Fund

Number of members at June 30 1 013 950

R’000 R’000

Employer contribution 61 323 9 280

Employee contribution 1 591 2 028

Total pension fund asset (unfunded pension liability)

Actuarial present value of defi ned benefi t obligations (419 090) (372 659)

Fair value of plan assets 653 920 509 327

Surplus in the plans 234 830 136 668

Unrecognised actuarial gains (113 484) (43 453)

Surplus in the plans not recognised due to the uncertainties relating to the apportionment of these surpluses (117 265) (115 689)

4 081 (22 474)

Movement in the liability for defi ned benefi t obligations

Balance at beginning of year (372 659) (502 974)

Benefi ts paid by plans 28 156 16 510

Current service costs (7 649) (5 020)

Interest (27 565) (29 459)

Member contributions (1 176) (1 775)

Actuarial gains (losses) 11 606 (8 436)

Past service costs (37 476) –

Settlement 13 307 –

Acquisition of businesses (17 154) –

Disposal of businesses – 161 479

Exchange rate adjustments on foreign plans (8 480) (2 984)

Balance at end of year (419 090) (372 659)

2007 R’000

2006 R’000


29. Post-retirement obligations (continued)

Movement in the plans’ assets


Contributions paid into the plans 62 914 11 308

Benefi ts paid by the plans (28 156) (16 510)

Expected return on plans’ assets 42 879 41 454

Actuarial gains (losses) 57 838 (7 001)

Transfer on settlement (22 002) –

Acquisition of businesses 23 625 –


Exchange rate adjustments on foreign plans 7 495 1 337

Balance at end of year 653 920 509 327

The plans’ assets comprise

Cash 219 290 98 589

Equity securities 268 114 250 004

Bonds 77 046 93 234

Property 17 671 23 497

Other 71 799 44 003

653 920 509 327

Amounts recognised in income statement

Current service costs 7 649 5 020

Interest on obligations 27 565 29 459

Past service costs 37 476 –

Settlement cost 8 695 –

Expected return on plans’ assets (42 879) (41 454)

Net actuarial losses (gains) recognised in current year (2 321) 8 302

Net amounts not recognised in income statement or balance sheet of the Group due to the uncertainties relating to the apportionment

of the pension fund surpluses. 1 160 15 776

37 345 17 103

Actual return on plan assets 103 763 34 146

Key actuarial assumptions % %

Expected rate of return on plan assets 5,8 – 8,0 5,2 – 9,0

Discount rate 4,8 – 8,4 3,1 – 9,0

Infl ation rate 3,3 – 5,5 1,0 – 5,0

Salary increase rate 4,0 – 6,5 6,0

Pension increase allowance 1,9 – 3,9 2,4 – 4,0

Date of valuation June 30 2007 June 30 2006

Assumptions regarding future mortality are based on published statistics and mortality tables.

The expected long-term rate of return is based on the expected rates of return on the individual asset categories. The return is based exclusively on historical returns, without adjustments.

The Group expects to pay R8 823 000 in contributions to defi ned benefi t plans in the year ending June 30 2008.

2007 R’000

2006 R’000



2007R’000

2006R’000

2005R’000

2004R’000

2003R’000

29. Post-retirement obligations (continued)

Historical information

Present value of the defi ned benefi t obligations (419 090) (372 659) (502 974) (234 551) (281 337)

Fair value of plans’ assets 653 920 509 327 622 916 210 747 236 782

Suplus (defi cits) in the plans 234 830 136 668 119 942 (23 804) (44 555)

Experience adjustments arising on plans’ liabilities – losses (gains) 11 606 (8 436) (100 270) (33 882) 17 018

Experience adjustments arising on plans’ assets – losses (gains) 57 838 (7 001) (49 413) (10 302) 11 222

2007R’000

2006R’000

Post-retirement medical aid obligations

The Group provides post-retirement medical benefi t subsidies to certain retired employees and is responsible for the provision of post-retirement medical benefi t subsidies to a limited number of current employees.

Provision for post-retirement medical aid obligations

Opening provision raised against unfunded obligation 198 618 188 491

Expense (income) recognised in income statement (7 124) 18 410

Payments charged against provisions (30 897) (8 372)

Acquisition of businesses 66 591

Disposal of businesses – (502)

Closing provision raised against unfunded obligation 160 663 198 618

Actuarially determined present value of total obligation using projected unit credit valuation method 160 663 198 618

Key actuarial assumptions % %

Discount rate 8,1 7,7

Infl ation rate (CPI) 4,8 4,6

Health care cost infl ation 7,2 6,7

A change in the medical infl ation rates will not have a signifi cant impact on the post-retirement medical aid costs and relating obligations.

R’000 R’000

30. Banking liabilities

Call deposits 146 893 63 324

Loans 15 424 19 301

Fixed and notice deposits 40 781 30 918

203 098 113 543

Maturity analysis

Maturing within one year 203 025 113 265

Maturing after one year but within fi ve years 73 278

203 098 113 543

Eff ective rates of interest % %

Call deposits 7,0 5,0

Loans 8,0 6,0

Fixed and notice deposits 8,0 6,0

Banking liabilities other than fi xed and notice deposits are at fl oating interest rates.


31. Operating leases

The Group has entered into various operating lease agreements in respect of premises.

Leases which have fi xed determinable escalations are charged to the income statement on a straight-line basis and liabilities are raised for the diff erence between the actual lease expense and the charge recognised in the income statement. The liabilities are classifi ed based on the timing of the reversal which will occur when the actual cash fl ow exceeds the income statement amounts.

Operating lease liabilities 178 176 155 152

Included in trade and other payables (12 080) (27 631)

Long-term portion 166 096 127 521

Operating lease commitments

Land and buildings 4 892 132 4 336 600

Due in one year 357 902 467 433

Due after one year but within fi ve years 1 313 184 1 468 799

Due after fi ve years 3 221 046 2 400 368

Equipment and vehicles 338 347 354 900

Due in one year 69 775 60 205

Due after one year but within fi ve years 267 138 293 582

Due after fi ve years 1 434 1 113

5 230 479 4 691 500

Less amounts raised as liabilities (178 176) (155 152)

5 052 303 4 536 348

32. Trade and other payables

Trade payables 9 836 418 9 204 332

Trade payables due to related parties 66 61

Floorplan creditors 775 927 355 971

Other payables and accrued expenses 3 580 095 3 002 331

14 192 506 12 562 695

The majority of trade and other payables are fi xed in the subsidiaries’ local currency. Since trade and other payables have limited exposure to exchange rate fl uctuations, a currency analysis has not been included.

2007 R’000

2006 R’000



33. Provisions

Short-term portion 200 375 224 798

Long-term portion 245 757 99 869

446 132 324 667

Movement in provisions Onerous

contractsR’000

Insurance liabilities

R’000

Dismantling and site

restorationR’000

OtherR’000

TotalR’000

Balance at June 30 2005 65 269 67 820 59 110 62 614 254 813

Created 41 501 20 074 13 422 66 261 141 258

Utilised (69 317) (6 954) – (47 648) (123 919)

Net acquisition of businesses 32 788 – – 3 455 36 243

Exchange rate adjustments 6 656 – 5 491 4 125 16 272

Balance at June 30 2006 76 897 80 940 78 023 88 807 324 667

Created 9 607 68 212 36 454 80 846 195 119

Utilised (22 036) – (7 088) (90 108) (119 232)

Net acquisition of businesses 25 875 – 8 707 (59) 34 523

Exchange rate adjustments 2 421 – 7 599 1 035 11 055

Balance at June 30 2007 92 764 149 152 123 695 80 521 446 132

Onerous contractsOnerous contracts are identifi ed through regular reviews of the terms and conditions of contracts as well as on acquisition of businesses. A provision for onerous contracts is calculated as the present value of the portion which management deems to be onerous in light of the current market conditions, discounted using market-related rates. An annual expense is recognised over the life of the contracts.

Insurance liabilitiesInsurance liabilities include unearned premiums that represent that part of the current year’s premiums that relate to risk periods that extend to the following year; claims which are calculated on the settlement amount outstanding at year end; and claims incurred but not reported which are maintained at 7% of net premium income, for claims arising from events that occurred before the close of the accounting period, but which had not been reported to the Group by that date.

Provision for costs of dismantling and restoration of siteA provision is raised for the estimated costs of dismantling and removing items and restoring the site on which they are located. The change in the liability arising as a result of unwinding the discount is recognised in the income statement as a fi nance charge. The dismantling of the plant and recommissioning of buildings is expected to coincide with the end of the useful life of the plant and lease periods.

OtherConsists of various individually insignifi cant amounts.

2007 R’000

2006 R’000

34. Commitments

Capital expenditure approved

Contracted for 676 558 540 479

Proposed, not contracted for 525 878 598 371

1 202 436 1 138 850

It is anticipated that capital expenditure will be fi nanced out of existing cash resources or borrowings.

2007 R’000

2006 R’000


35. Contingent liabilities

Guarantees issued in respect of obligations of associates 16 000 41 000

The Group has provided guarantees to third parties of R100,4 million (2006: R100,9 million) in respect of its investment in Mumbai International Airport Private Limited.

The Group has outstanding legal and other claims arising out of its normal ongoing operating activities which have to be resolved. None of the claims is signifi cant.

36. Financial instruments

Exposure to currency, interest rate and credit risk arises in the normal course of the Group’s business.

Currency riskThe Group incurs currency risk as a result of purchases and sales which are denominated in a currency other than the Group’s reporting currency. Group entities hedge all trade receivables and trade payables denominated in a foreign currency. At any point in time they also take out economic hedges over their estimated foreign currency exposure resulting from sales and purchases. Most of the forward exchange contracts have maturities of less than one year after the balance sheet date. Where necessary, the forward exchange contracts are rolled over at maturity.

Changes in the fair value of forward exchange contracts that economically hedge monetary assets and liabilities in foreign currencies and for which no hedge accounting is applied are recognised in the income statement. Both the changes in fair value of the forward contracts and the foreign exchange gains and losses relating to the monetary items are recognised in operating profi t (refer note 2).

Settlement Foreign amount

000’sRand amount

000’s

In respect of forward exchange contracts relating to foreign liabilities as at June 30 2007

Japanese yen July 2007 to September 2007 2 395 372 147 041

US dollars July 2007 to December 2007 22 389 157 798

Euro July 2007 to October 2007 8 793 85 210

Sterling July 2007 to October 2007 1 516 21 463

other July 2007 to September 2007 7 038 4 234

In respect of forward exchange contracts relating to goods and services ordered but not accounted for as at June 30 2007

Japanese yen July 2007 to December 2007 1 672 210 101 424

US dollars July 2007 to November 2007 22 414 161 002

Euro July 2007 to November 2007 2 785 27 232

Mauritian rupee July 2007 to August 2007 643 156

Sterling July 2007 to September 2007 181 2 574

other July 2007 to August 2007 104 605

2007 R’000

2006 R’000



36. Financial instruments (continued)

Interest rate riskThe Group adopts a policy of ensuring that its borrowings are at market-related rates to address its interest rate risk. The Group’s investments in listed bonds, accounted for as available-for-sale and held-for-trading fi nancial assets are exposed to a risk of change in fair value due to changes in interest rates. Investments in equity securities accounted for as held-for-trading fi nancial assets and trade receivables and payables are not exposed to interest rate risk.

Credit riskManagement has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount. Reputable fi nancial institutions are used for investing and cash handling purposes. At balance sheet date there were no signifi cant concentrations of credit risk. The balance sheet amount refl ects the maximum credit exposure.

Fair valuesThe carrying amount of all fi nancial assets and liabilities approximates fair value with the exception of borrowings (which have been accounted for as amortised cost and certain investments where fair value cannot be determined). The fair value of borrowings, together with the carrying amounts shown in the balance sheet, is:

2007 2006

Carrying amount

R’000Fair value

R’000

Carrying amount

R’000Fair value

R’000

Borrowings

Loans secured by mortgage bonds over fi xed property 9 626 9 626 10 014 10 014

Loans secured by lien over certain property, plant and equipment in terms of fi nancial leases and

suspensive sale agreements 78 714 78 714 80 242 80 242

Unsecured loans 3 813 988 3 682 669 3 688 047 3 653 628

Vehicles lease creditors secured by pledge of inventories 29 251 29 251 18 285 18 285

Floorplan creditors secured by pledge of inventories 449 337 449 337 202 496 202 496

Bank overdrafts 1 757 977 1 757 977 708 462 708 462

6 138 893 6 007 574 4 707 546 4 673 127

Unrecognised gain (131 319) (34 419)

The methods used to estimate the fair values of fi nancial instruments are discussed in note 39.

The interest rates used to discount cash fl ows, in order to determine fair values, are based on market related rates at June 30 2007 ranging from 2,0% to 24,0%.

Sensitivity analysesIn managing interest rate and currency risks the Group aims to reduce the impact of short-term fl uctuations on the Group’s earnings. Over the longer term, however, permanent changes in foreign exchange and interest rates would have an impact on consolidated earnings.

At June 30 2007, it is estimated that a general increase of one percentage point in interest rates would not have a signifi cant eff ect on the Group’s profi t and would amount to a decrease of approximately R34,0 million in profi t after taxation. It is estimated that a general increase of one percentage point in the value of the rand against other foreign currencies would decrease the Group’s profi t before taxation by approximately R11,9 million for the year ended June 30 2007.


37. Related parties

Identity of related partiesThe Group has a related party relationship with its subsidiaries, associates and joint ventures (details of major subsidiaries, joint ventures and associates are refl ected on page 188 to page 191 of this report). Key management personnel has been defi ned as the executive and non-executive directors of the Company. The defi nition of key management includes the close members of family of key management personnel and any other entity over which key management exercises control. Close members of family are those family members who may be expected to infl uence, or be infl uenced by that individual in their dealings with the Group. They may include the individual’s domestic partner and children, the children of the individual’s domestic partner, and dependants of the individual or the individual’s domestic partner.

Transactions with key management personnelDirectors of the Company and their immediate relatives control 2,7% of the voting shares of the Company.

Independent non-executive directors do not participate in the Group’s share option and share purchase schemes.

Details pertaining to executive directors’ compensations are set out in the directors’ report on page 133. Directors’ remuneration is included in note 2.

The Group encourages its employees to purchase goods and services from Group companies. These transactions are generally conducted on terms no more favourable than those entered into with third parties on an arm’s-length basis, although in some cases nominal discounts are granted. Transactions with key management personnel are conducted on similar terms. No abnormal or non-commercial credit terms are allowed, and no impairments were recognised in relation to any transactions with key management personnel during the year, nor have they resulted in any non-performing debts at year end.

Similar policies are applied to key management personnel at subsidiary level who are not defi ned as key management personnel at Group level.

Certain of the directors of the Group are also non-executive directors of other public companies which may transact with the Group. The relevant directors do not believe they have signifi cant infl uence over the fi nancial or operational policies of those companies. Those companies are thus not regarded as related parties.

The following transactions were made on terms equivalent to those that prevail in arm’s-length transactions between subsidiaries of the Group and key management personnel (as defi ned above) and/or organisations in which key management personnel have signifi cant infl uence:

2007R’000

Sales and services provided by the Group 29 452

Purchases 14 191

Outstanding amounts due to the Group at year end included in respect of the share purchase scheme 128 013

Outstanding amounts due to the Group at year end included in trade receivables 7 471

Outstanding amounts due by the Group at year end included in trade payables 66

Guarantees issued –

Transactions with associatesThe following transactions were made on terms equivalent to those that prevail in arm’s-length transactions between subsidiaries and associates of the Group

Sales and services provided by the Group 2 906

Purchases 13 263

Outstanding amounts due to the Group at year end included in advances to associates 43 101

Outstanding amounts due to the Group at year end included in trade receivables –

Outstanding amounts due by the Group at year end included in trade payables –

Guarantees issued 16 000

Details of eff ective interest, investments and loans to associates are disclosed in note 18 and detailed on page 191.



38. Accounting estimates and judgements

The audit committee has considered the Group’s critical accounting policies, key sources of uncertainty and areas where critical

accounting judgements were required in applying the Group’s accounting policies.

Critical accounting policies

The audit committee is satisfi ed that the critical accounting policies are appropriate to the Group.

Key source of uncertainty

A key source of uncertainty relates to the liabilities to the benefi t funds or related assets due to the surplus apportionment in terms of

the Pensions Fund Act which has yet to be fi nalised and approved. Details relating to the current surpluses and defi cits are included in

note 29.

Critical accounting judgements in applying the Group’s accounting policies

Judgements made in the application of IFRS that have a signifi cant risk of causing a material adjustment to the carrying amounts of

assets and liabilities within the next fi nancial year are discussed below.

Property, plant and equipment

The residual values of the property, plant and equipment are reveiwed annually after considering future market conditions, the remaining

life of the asset and projected disposal values. The estimation of the useful lives is based on historic performance as well as expectation

about future use and, therefore, requires a degree of judgement to be applied. The depreciation rates represent management’s current

best estimate of the useful lives of the assets.

Impairment of goodwill

The Group has assessed the carrying values of goodwill to determine whether any of the amounts have been impaired. The carrying

values were assessed using a combination of discounted cash fl ow and price earnings methods, the actual results and forecasts for future

years.

Deferred taxation

Deferred tax assets are recognised to the extent it is probable that the taxable income will be available against which they can be utilised.

Future taxable profi ts are estimated based on business plans which include estimates and assumptions regarding economic growth,

interest, infl ation and taxation rates and competitive forces.

Investments

The Group refl ects its held-for-trade and available-for-sale investments at fair value. The directors’ value of unlisted investments was

determined using a combination of discounted cash fl ow, net asset value and price earnings methods.

Inventories

Impairment provisions are raised against inventory when it is considered that the amount realisable from such inventory’s sale is

considered to be less than its carrying amount. The provision is made with reference to an inventory age analysis.

Trade receivables

Management identifi es impairment of trade receivables on an ongoing basis. An allowance for doubtful debts is raised against trade

receivables when their collectibility is considered to be doubtful. Management believes that the impairment adjustment is conservative

and there are no signifi cant trade receivables that are doubtful and have not been impaired. In determining whether a particular

receivable could be doubtful, the age, customer’s current fi nancial status and disputes with the customer are taken into consideration.

Post-retirement obligations

The Group provides retirement benefi ts for its permanent employees through pension funds with defi ned benefi t and defi ned

contribution categories. Actuarial valuations are based on assumptions which include the discount rate, infl ation rate, salary increase rate,

expected return on plan assets and the pension increase allowance rate.


39. Determination of fair value

A number of the Group’s accounting policies and disclosures require the determination of fair value, for both fi nancial and non-fi nancial

assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods.

Where applicable, further information about the assumptions made in determining fair values is disclosed in the notes specifi c to that

asset or liability.

Property, plant and equipment

The fair value of property, plant and equipment recognised as a result of a business combination is based on market values. The market

value of property is the estimated amount for which a property could be exchanged on the date of valuation between a willing buyer

and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently

and without compulsion. The market values of other assets are based on the quoted market prices for similar items.

Intangible assets

The fair value of intangible assets is based on the discounted cash fl ows expected to be derived from the use and eventual sale of the

assets.

Inventory

The fair value of inventory acquired in a business combination is determined based on its estimated selling price in the ordinary course of

business less the estimated costs of completion and sale, and a reasonable profi t margin based on the eff orts required to complete and

sell the inventory.

Investments

Fair value of listed investments is calculated by reference to stock exchange quoted selling prices at the close of business on the balance

sheet date. Fair value of unlisted investments is determined by using appropriate valuation models.

Forward exchange contracts

The fair value of forward exchange contracts is based on their listed market prices.

Borrowings

Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash

fl ows, discounted at the market rate of interest at the reporting date. For fi nance leases the market rate of interest is determined by

reference to similar lease agreements. The carrying value of the bank overdrafts is the fair value.

Share-based payments

The fair value of the share options is measured using a binomial method. Measurement inputs include share price at measurement date,

exercise price of the instrument, expected volatility (based on the historic volatility), option life, distribution yield and the risk-free interest

rate (based on national government bonds).



40. Standards and interpretations not eff ective at June 30 2007

At the date of approval of the annual fi nancial statements, the following standards and interpretations that apply to the Group were in issue but not yet eff ective

Standard/interpretation Description Eff ective date

IFRS 7 Financial InstrumentsDisclosures (including amendments to IAS 1 Presentation of Financial Statements – Capital Disclosures)

July 1 2007

IFRIC 11 IFRS 2 Group and Treasury Transactions July 1 2007

IFRIC 14 IAS 19 The limit on a defi ned benefi t asset, minimum funding requirements and their interaction

July 1 2008

IFRS 8 Operating segments July 1 2009

IAS 23 Borrowing Costs July 1 2009

IFRS 7 and amendments to IAS 1The disclosures provided in respect of fi nancial instruments in the fi nancial statements for the period ending June 30 2008, as well as comparative information, will be compliant with IFRS 7 and IAS 1. The disclosure requirements of IFRS 7 require additional disclosure compared to that required in terms of existing IFRS in respect of:

Qualitative disclosuresFurther information regarding each type of fi nancial instrument risk including the exposures to risk and how they arise; the Group’s objectives, policies and processes for managing the risk; the methods used to measure the risk; and any changes from the previous period.

Quantitative disclosuresFurther information regarding each type of the Group’s fi nancial instrument risk including a summary of quantitative data about exposure to that risk at the reporting date including any concentrations of credit risk; fi nancial assets that are either past due or impaired; any collateral and other credit enhancements obtained; liquidity risk; market risk; and capital objectives and policies.

The adoption of IFRS 7 and amendments to IAS 1 will not have any impact on the accounting policies adopted for fi nancial instruments.

IFRIC 11In terms of IFRIC 11, when a subsidiary grants rights to equity instruments of its parents to its employees, the subsidiary shall account for the transaction with its employees as a cash-settled share-based payment transaction. No such transactions have occurred or are anticipated to take place.

IFRIC 14IFRIC 14 will be adopted by the Group for the fi rst time for the year ending June 30 2009.

This interpretation addresses when refunds or reductions in future contributions should be regarded as available in accordance with paragraph 19 of IAS 19 Employee Benefi ts; how a minimum funding requirement might aff ect the availability of reductions in future contributions; and when a minimum funding requirement might give rise to a liability.

The eff ect of adopting IFRIC 13 has not yet been calculated but is not expected to be material.

IFRS 8In terms of IFRS 8, eff ective for the year ending June 30 2010, segment reporting will be based on the information that management uses internally for evaluating segment performance and when deciding how to allocate resources to operating segments. Such information may diff er from what is used to prepare the income statement and balance sheet.

The adoption of IFRS 8 will have no impact on the Group as the consolidated segmental analysis is already prepared on the aforementioned basis.

IAS 23This revised standard supersedes the existing IAS 23 and will be adopted by the Group for the fi rst time for the year ending June 30 2010.

The revised IAS 23 states that borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset form part of the cost of that asset and other borrowing costs are recognised as an expense. Therefore the accounting policy election to either capitalise or expense borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset no longer exists.

There is no impact on adoption of this statement as the Group’s existing accounting policy with regard to the capitalisation of borrowing costs is consistent with the requirements of the revised IAS 23.


2007 2006

41. Foreign currency exchange rates

The following exchange rates were used in the conversion of foreign interests and foreign transactions at June 30

Rand/Sterling

Opening rate 13,20 11,96

Closing rate 14,18 13,20

Average rate 13,95 11,44

Rand/Euro




Rand/Australian dollar




Rand/United States dollar





Note 2007

R’0002006R’000

Dividends received 1 086 423 994 216

Subsidiaries and joint ventures 1 077 300 991 142

Associates 9 083 3 074

Unlisted investments 40 –

Fair value adjustments and impairment of investments in subsidiaries, joint ventures and associates (24 634) (356 199)

Profi t on disposals of subsidiaries, joint ventures and associates 2 206 1 332

Profi t before taxation 1 063 995 639 349

Taxation 2 (337) (368)

Profi t for the year attributable to shareholders 1 063 658 638 981

Company income statementfor the year ended June 30

Note 2007R000

2006R000

Cash outfl ow from operating activities (238 806) (73 280)

Cash generated by operations 3 1 087 468 996 167

Taxation refund received (taxation paid) 4 (246) 4 576


Cash eff ects of investment activities (279 529) (128 201)

Decrease (increase) in advances to subsidiaries (230 937) 556 985

Increase in advances to associates – (20 095)

Acquisitions of subsidiaries and associates 5 (67 262) (672 783)

Proceeds on disposals of subsidiaries and associates 6 18 670 7 692

Cash eff ects of fi nancing activities

Proceeds from share issues 494 094 180 274

Net decrease in cash and cash equivalents (24 241) (21 207)

Cash and cash equivalents at beginning of year 64 371 85 578

Cash and cash equivalents at end of year 40 130 64 371

Company cash fl ow statementfor the year ended June 30


Company balance sheetas at June 30

Note 2007

R’0002006R’000

ASSETS

Non-current assets 5 411 529 5 170 886

Interest in subsidiaries 7 5 246 208 5 010 402

Interest in joint ventures 8 4 540 4 540

Interest in associates 9 160 431 155 094

Investments 10 350 850

Current assets

Cash and cash equivalents 40 130 64 371

Total assets 5 451 659 5 235 257

EQUITY AND LIABILITIES

Capital and reserves 11 5 440 873 5 151 066

Current liabilities 10 786 84 191

Trade and other payables 10 467 8 395

Provisions – 37 578

Vendors for acquisition – 37 990

Taxation 319 228

Total equity and liabilities 5 451 659 5 235 257


Notes to the Company fi nancial statementsfor the year ended June 30

1. Statement of recognised income and expenses

A statement of recognised income and expenses has not been prepared as there were no amounts recognised directly in equity. Details of changes in capital and reserves are provided in note 11.

2. Taxation

Current taxation 337 232

Current year 319 –

Prior years 18 232

Secondary taxation on companies – 136

Total taxation per income statement 337 368

The reconciliation of the eff ective tax rate with the company tax rate is as follows % %

Taxation for the year as a percentage of profi t before taxation – (0,1)

Dividend and exempt income 29,7 45,2

Changes in prior years’ estimation – 0,1

Expenses not taxable or allowed (0,7) (16,2)

Rate of South African company taxation 29,0 29,0

R’000 R’000

Secondary taxation on companies – dividend credits available 158 962 91 442

3. Cash generated by operations

Profi t before taxation 1 063 995 639 349

Adjustment for non-cash items 22 428 354 867

Retained to fi nance working capital

Increase in trade and other payables and provisions 1 045 1 951

Cash generated by operations 1 087 468 996 167

4. Taxation refund received (taxation paid)

Amount payable at beginning of year (228) 4 716

Per income statement (337) (368)

Amount payable at end of year 319 228

Refund received (amount paid) (246) 4 576

5. Acquisitions of subsidiaries and associates

Interest in subsidiaries (18 325) (661 949)

Interest in associates (10 947) (48 824)

Total value of acquisitions (29 272) (710 773)

Vendors for acquisition at beginning of year (37 990) –

Vendors for acquisition at end of year – 37 990

Amounts paid (67 262) (672 783)

2007 R’000

2006 R’000


6. Proceeds on disposal of subsidiaries and associates

Interest in subsidiaries 10 354 6 360

Interest in associates 6 110 –

Net carrying value 16 464 6 360

Profi t on disposal 2 206 1 332

Net proceeds 18 670 7 692

7. Interest in subsidiaries

Shares at cost 2 838 505 2 820 262

Due by subsidiaries 2 828 896 2 618 389

Due to subsidiaries (421 193) (428 249)

5 246 208 5 010 402

Details of subsidiaries are refl ected on pages 188 to 191 of this report.

8. Interest in joint ventures

Shares at cost 4 540 4 540

Details of major joint ventures are refl ected on page 191 of this report.

9. Interest in associates

Listed 50 625 56 272

Unlisted 89 711 78 727

140 336 134 999

Interest free advances 20 095 20 095

160 431 155 094

Market value of listed associates 455 456 213 186

Directors’ value of unlisted associates 186 202 131 216

641 658 344 402

Details of major associates are refl ected on page 191 of this report.

10. Investments

Unlisted shares 350 850

Directors’ value of unlisted investments 350 850

2007 R’000

2006 R’000


Notes to the Company fi nancial statementsfor the year ended June 30

11. Capital and reserves

Share capital

Authorised

540 000 000 (2006: 540 000 000) ordinary shares of 5 cents each 27 000 27 000

Number Number

Issued


Shares issued in terms of the share incentive scheme 5 575 569 4 756 648

Balance at end of year 330 753 967 325 178 398

R’000 R’000

Issued share capital 16 538 16 259


Shares issued in terms of the share incentive scheme 279 238

Share premium 1 863 743 2 695 956


Arising on shares issued in terms of the share incentive scheme 493 815 180 217


Share issue expenses – (181)

Reserves

Equity-settled share-based payment reserve 166 028 107 945



Retained earnings 3 394 564 2 330 906


Profi t attributable to shareholders 1 063 658 638 981

Total capital and reserves 5 440 873 5 151 066

30 000 000 of the unissued shares are under the control of the directors until the next annual general meeting.

12. Contingent liabilities

In respect of guarantees of banking and other facilities granted to subsidiaries and associates 16 633 942 11 116 200

Of which has been utilised 4 575 525 2 740 463

2007 R’000

2006 R’000


13. Borrowing powers

Borrowing powers, in terms of the articles of association, are unlimited.

14. Related parties

The subsidiaries, joint ventures and associates of the Group are identifi ed in the annexure set out on pages 188 to 191. All of these entities are related parties of the Company. The Company has made loans to, and has received loans from, certain of these entities as set out in the said annexure.

Details of income received from these related parties are included in the income statement.

All expenditure incurred by the Company is borne by a subsidiary in lieu of administration fees and interest.


Interest in subsidiaries, joint ventures and associatesas at June 30

Major subsidiaries Catering supplies, food and allied products 3663 First for Food Service (Pty) Limited# * 100 100 – – – – Angliss Hong Kong Food Service Limited(1) 142 100 – – – – –Angliss International Investment Limited(1) 1 100 – – – – –Angliss Singapore Pte Limited(2) 51 665 100 – – – – –Angliss USA Inc.(3) 1 100 – – – – –BFS Group Limited (trading as 3663)(4) 425 225 100 100 – – – – Bid Food Ingredients (Pty) Limited# * 100 100 – – – –Bid Foodservice (Europe) Limited(4) 141 798 100 100 – – – – Bidbake (Pty) Limited# * 100 100 – – – – Bidfood (Pty) Limited# * 100 100 – – – – Bidvest (N.S.W) Limited(5) * 100 100 – – – – Bidvest (Victoria) (Pty) Limited(5) * 100 100 – – – – Bidvest (W.A.) (Pty) Limited(5) * 100 100 – – – – Bidvest Australia Limited(5) 954 100 100 – – – – Blue Marine Frozen Foods (Pty) Limited# * 100 100 – – – – Burleigh Marr Distributions (Pty) Limited(5) 78 100 100 – – – – C.C.W. Catering Supplies (Pty) Limited# * 100 100 – – – – Caterplus (Botswana) (Pty) Limited(6) * 100 100 – – – – Caterplus (Pty) Limited(5) * 100 100 – – – – Caterplus (Pty) Limited# * 100 100 – – 2 429 2 429Caterplus Namibia (Pty) Limited(7) * 100 100 – – – – Catersales (Pty) Limited# * 100 100 – – – – Chipkins Bakery Supplies (Pty) Limited# * 100 100 – – – – Chipkins Catering Supplies (Pty) Limited# * 100 100 – – – – Continental Spice Works (Pty) Limited# * 100 100 – – – – Crean Foodservice Limited(8) * 100 100 – – – – Crown National (Pty) Limited# 10 100 100 10 10 (10) (10)D and R Lowe Catering Supplies (Pty) Limited# * 100 100 – – (312) (312)Deli Xl Belgie Nv(9) 804 065 100 100 – – – – Deli Xl BV(10) 112 594 100 100 – – – – Deli Xl SA(9) 18 937 100 100 – – – – Everyday Foods (Pty) Limited * 100 100 – 1 003 – – First Food Distributors (Pty) Limited# * 100 100 – – – – Horeca Trade Llc(11) 578 80 80 – – – – Hotel Amenities Suppliers (Pty) Limited * 100 100 – – – – International Bakery Ingredients (Pty) Limited * 100 100 8 108 19 647 – – John Lewis Foodservice (Pty) Limited(5) * 100 100 – – – – Lou’s Wholesalers (Pty) Limited# * 100 100 – – – – Lufi l Packaging (Pty) Limited * 100 100 59 244 59 244 – – M & M Quality Choice (Pty) Limited# * 100 100 – – – – Modern Packaging (Benoni) (Pty) Limited# * 100 100 – – – – N Stephenson (Pty) Limited(5) 240 100 100 – – – – National Spice Works (Pty) Limited# * 100 100 140 140 (140) (140)NCP Yeast (Pty) Limited# * 100 100 – – – – Patleys (Pty) Limited# * 100 100 – – – – Pinnacle Limited(4) 14 100 – – – – – RFS Catering Supplies (Pty) Limited# * 100 100 – – – – The Barton Meat Company Limited(4) 1 51 51 – – – – Tri-Mark Industries (Pty) Limited * 100 100 221 4 044 – – Vulcan Catering Equipment (Pty) Limited# * 100 100 – – – –

Travel, fi nancial and related services Bid Financial Services (Pty) Limited * 100 100 – – 90 000 90 000 Bidtravel (Pty) Limited# * 100 100 – – – – Bidvest Bank Limited 1 800 100 100 – – – –Concorde Travel (Pty) Limited * 90 90 47 538 47 433 – – Connex Travel (Pty) Limited 100 47 47 28 149 28 040 5 513 5 513Namibia Bureau de Change (Pty) Limited(7) 500 51 51 – – – – Prestige Travel SA (Pty) Limited# * 100 100 – – – – Rennies Travel (Namibia) (Pty) Limited(7) * 100 100 – – – – Rennies Travel (Pty) Limited * 75 75 1 644 1 151 – – Travel Connections (Pty) Limited * 60 60 9 184 9 119 – – Uniworld Travel (Pty) Limited# * 100 100 – – – – World Travel (Pty) Limited 3 350 100 100 7 369 7 306 – –

Freight forwarding, clearing, distribution warehousing and allied activities African Shipping Limited 2 450 100 100 8 996 8 996 – – Bidcorp Outsourced Services Limited(4) 307 774 100 100 – – – – Bidcorp Property Limited(4) * 100 100 – – – – Bidfreight (Pty) Limited# * 100 100 – – – – Bidfreight Intermodal (Pty) Limited# * 100 100 – – – – Bidfreight Logistics (Pty) Limited# * 100 100 – – – – Bidfreight Port Operations (Pty) Limited# * 100 100 – – – – Bidfreight Terminals (Pty) Limited# * 100 100 – – – – Bulk Connections (Pty) Limited# * 100 100 – – – – Freightbulk (Pty) Limited * 100 100 680 672 108 108

Company’s interestIssued Eff ective holdings Shares Indebtednesscapital 2007 2006 2007 2006 2007 2006 R’000 % % R’000 R’000 R’000 R’000


Freight forwarding, clearing, distribution warehousing and allied activities (continued)Island View Storage Limited 6 300 100 100 367 592 367 226 – – Island View Storage Richards Bay (Pty) Limited 500 100 100 – – – – Lubrication Specialists (Pty) Limited * 32 32 – – – – Luderitz Bay Shipping & Forwarding (Pty) Limited(12) * 85 62 – – – – Manica (Botswana) (Pty) Limited(6) 170 100 100 – – – – Manica (Malawi) Limited(13) 345 100 75 – – – – Manica Africa (Pty) Limited 3 088 100 100 – – – – Manica Congo (Pty) Limited(14) * 100 100 – – – – Manica Group Namibia (Pty) Limited(7) 275 85 62 – – – – Manica Holdings Limited 1 100 100 77 447 77 280 35 300 23 499Manica Information Technology (Pty) Limited * 62 62 – – – – Manica (Zambia) Limited(15) 790 100 100 – – – – Manica Zimbabwe Limited(16) * 100 100 – – – – Naval Servicos A Navegaçao Limitada(12) 10 100 100 – – – – Ontime Automotive (Prestige Vehicle Distribution) Limited(4) * 100 100 – – – – Ontime Automotive (Specialist Operations) Limited(4) 1 100 100 – – – – Ontime Automotive (Technical Services) Limited(4) 14 100 100 – – – – Ontime Automotive (Volume Distribution) Limited(4) 660 100 100 – – – – Ontime Automotive Limited(4) 425 236 100 100 – – – – Ontime Rescue & Recovery Limited(4) 1 100 100 – – – – P & I Associates (Pty) Limited# * 100 100 – – – – Procdib Limited(4) * 100 100 – – – – Renfreight (Pty) Limited * 100 100 95 554 95 554 (108) (108)Rennie Murray and Company (Pty) Limited# * 100 100 – – – – Rennies Distribution Services (Pty) Limited# * 100 100 – – – – Rennies Property Holdings (Pty) Limited 54 000 100 100 54 000 54 000 – – Rennies Ships Agency (Pty) Limited# * 100 100 – – – – Safcor Freight (Pty) Limited (trading as Safcor Panalpina) * 100 100 107 722 106 512 – –South African Bulk Terminals Limited 2 100 100 51 399 51 125 – – South African Container Depots (Pty) Limited# * 100 100 – – – – South African Container Stevedores (Pty) Limited 1 82 82 61 37 – – Walvis Bay Stevedoring Company (Pty) Limited(7) * 43 34 – – – – Woker Freight Services (Pty) Limited(7) 29 85 62 – – – –

Offi ce furniture, supplies and related products Bid Information Exchange (Pty) Limited# * 100 100 – – – – Bonanza Holdings (Pty) Limited * 100 100 – – 5 076 5 396Budget Desks and Chairs (Pty) Limited# * 100 100 – – – – Cecil Nurse (Pty) Limited# * 100 100 – – – – Cecil Nurse Namibia (Pty) Limited(7) * 100 100 – – – – Contract Offi ce Products (Pty) Limited# * 100 100 – – – – Dauphin Offi ce Seating SA (Pty) Limited * 71 71 1 819 1 663 – – Ditulo Offi ce (Pty) Limited * 40 40 – – – – Hortors Stationery (Pty) Limited# * 100 100 – – – – Kolok (Botswana) (Pty) Limited(6) * 100 100 – – – – Kolok (Namibia) (Pty) Limited(7) * 100 100 – – – – Kolok (Pty) Limited# * 100 100 – – – – Minolco (Namibia) (Pty) Limited(7) * 100 100 – – – – Minolco (Pty) Limited# * 100 100 – – – – Nuclear Corporate Furniture (Pty) Limited# * 100 100 – – – – Off urn Clearance House (Pty) Limited# * 100 100 5 963 5 963 (6 551) – Pago Designs (Pty) Limited * 100 100 960 3 644 600 600 Seating (Pty) Limited# * 100 100 – – – – South African Diaries (Pty) Limited# * 100 100 – – – – Waltons Stationery Company (Pty) Limited# 31 100 100 31 31 (31) (31)Waltons Stationery Company (Namibia) (Pty) Limited(7) * 100 100 – – – –

Printing and stationery products Bid Commercial Products (UK) Limited(4) * 100 100 – – – – Bidpaper Plus (Pty) Limited * 100 100 – – – – Blesston Printing and Associates (Pty) Limited * 100 – – – – – Email Connection (Pty) Limited * 100 100 1 708 2 606 – – Expressed Solutions (Pty) Limited * 100 100 – – 7 127 7 687 Globe Stationery Manufacturing Company (Pty) Limited# * 100 100 – – – – Kolok Africa (Pty) Limited# * 100 100 – – – – Lithotech (Pty) Limited * 100 100 – – – – Lithotech Afric Mail (Cape) (Pty) Limited 160 100 100 – – – – Lithotech Corporate (Pty) Limited * 100 100 – – – – Lithotech Holdings Limited 473 100 100 139 593 137 661 – 10 000Lithotech Solutions (Pty) Limited * 100 100 – – – – Ozalid South Africa (Pty) Limited# * 100 100 – – – – Silveray Manufacturers (Pty) Limited# 58 100 100 – – – – Silveray Statmark Company (Pty) Limited# 11 100 100 7 017 7 017 (3 089) (3 290)Tension Envelope (Pty) Limited# * 100 100 – – – –



Interest in subsidiaries, joint ventures and associatesas at June 30

Major subsidiaries (continued)Packaging closures and fastening systems Afcom Group Limited 343 100 100 10 435 12 412 31 587 31 587 African Commerce Developing Company (Pty) Limited# 151 100 100 – – – – Buff alo Executape (Pty) Limited# * 100 100 – – – – Buff alo Tapes (Pty) Limited# * 100 100 – – – – G E Hudson (Pty) Limited# * 100 100 – – – – Ram Fasteners (Pty) Limited * 100 100 3 485 3 441 11 836 11 836

Linen rental, laundry, cleaning and other services Airport Handling Services (Pty) Limited * 40 40 – – – – Bidair Services (Pty) Limited# * 100 100 625 409 – – Bidprocure (Pty) Limited# * 100 100 – – – –Bidserv (Pty) Limited# * 100 100 – – – – Bidserv Industrial Products (Pty) Limited# * 100 100 – – – – Bidserv Mozambique Limitada(12) 6 100 100 – – – –Bidserv Risk Solutions (Pty) Limited# * 100 100 – – – – Bidvest (Zambia) (Pty) Limited(15) * 100 100 – – – – Bosnandi Laundry (Pty) Limited * 51 51 – – – – Commuter Handling Services (Pty) Limited 1 65 – 8 063 – 7 725 –Companhia de Fumigaçoes de Mozambique Limitada(12) 6 100 100 – – – – Dinatla Property Services (Pty) Limited 30 50 50 939 925 – – Execufl ora (Pty) Limited# * 100 100 – – – – Express Air Services (Pty) Limited 1 100 100 – – – –First Garment Rental (Pty) Limited# * 100 100 – – – – First In Staffi ng Solutions (Pty) Limited * 100 100 – – – – Giant Clothing Limited(13) 8 100 100 – – – – Global Payment Technologies Cash Systems (Pty) Limited# * 100 100 44 301 44 301 – – Industro Cleaning Botswana (Pty) Limited(6) * 80 – – – – –Ingenico SA (Pty) Limited# * 100 100 8 037 8 037 – – Langa Status Property Services (Pty) Limited * 45 45 – – – – Magnum Shield Security Services (Pty) Limited# * 100 100 – – – – Master Guard Fabric Protection Africa (Pty) Limited * 50 50 16 16 – – MyMarketdot Com (Pty) Limited# * 100 100 – – – – Nomtsalane Property Services (Pty) Limited * 43 43 – – – – Prestige Cleaning Services (Pty) Limited# * 100 100 – – – – Provicom Risk Solutions (Pty) Limited# * 100 100 – – – – Pureau Fresh Water Company (Pty) Limited# * 100 100 – – – – QMS Consulting (Pty) Limited# * 100 100 – – – – Rochester Midlands Industries SA (Pty) Limited * 50 50 167 167 – – Setsebi Property Services (Pty) Limited * 50 50 – – – – Steiner Environmental Solutions (Pty) Limited# * 100 100 – – – –Steiner Group (Pty) Limited# * 100 100 – – – – Steiner Hygiene (Pty) Limited# * 100 100 – – – – Steiner Hygiene Swaziland (Pty) Limited#(19) 6 100 100 – – – – Strategic Corporate Solutions (Pty) Limited# * 100 100 – – – – Taemane Cleaning Services (Pty) Limited * 70 70 – – – –TMS Group Industrial Services (Pty) Limited 1 100 100 – – 32 32Top Turf Botswana (Pty) Limited(6) * 100 100 – – – – Top Turf Group (Pty) Limited# * 100 100 4 4 (4) (4)Top Turf Mauritius (Pty) Limited(17) * 100 100 – – – – Top Turf Seychelles (Pty) Limited(18) 1 100 100 – – – – Total Outdoors (Swaziland) (Pty) Limited(19) * 100 100 – – – – Umoja Property Solutions (Pty) Limited * 51 51 – – – – Vericon Outsourcing (Pty) Limited# * 100 100 – – – –

Electrical, security and related products Bellco Electrical Company (Pty) Limited 200 100 100 – – – – Berzack Brothers (Jhb) (Pty) Limited 200 100 100 – – – – Berzack Brothers (Pty) Limited 4 300 100 100 – – – – Bloch & Levitan (Pty) Limited 50 100 100 – – – – Eastman Staples Limited(4) 224 50 50 – – – – Sanlic International (Pty) Limited * 100 100 – – – – Versalec Cables (Pty) Limited * 100 100 38 131 37 990 – – Voltex (Pty) Limited 9 100 100 – – – – Voltex Holdings Limited 6 630 100 100 261 984 257 049 – – Voltex Management Services (Pty) Limited * 100 100 – – – –Voltex Namibia (Pty) Limited(7) * 100 100 – – – –

Motor retail and related services Autohaus Centurion (Pty) Limited * 50 49 – – – –Eliance (Pty) Limited * 100 100 – – – – Gaz Motor Corporation Southern Africa (Pty) Limited 4 43 43 – – – – Inyanga Motors (Pty) Limited 50 80 – – – – –Inyanga Plaza Investments (Pty) Limited 50 80 – – – – –Kunene Motor Holdings Limited * 60 60 – – – – McCarthy Car Hire (Botswana) (Pty) Limited(6) * 100 100 – – – – McCarthy Car Hire Namibia (Pty) Limited(7) * 100 100 – – – – McCarthy Fleet Services (Pty) Limited * 100 100 – – – –McCarthy Investments (Namibia) (Pty) Limited(7) * 85 85 – – – – McCarthy Limited 1 183 907 100 100 775 132 759 727 – – McLife Assurance Company Limited 10 000 100 100 – – – – McProp Properties (Pty) Limited 90 100 100 – – – – McSant Motors (Pty) Limited * 74 – – – – –McSure Limited 10 000 100 100 – – – –



Group services, investment, property and dormant companies Airport Logistics Property Holdings (Pty) Limited * 50 50 142 142 – – BB Investment Company (Pty) Limited# * 100 100 – – – – BICP Off shore Holdings (Pty) Limited * 100 100 – – 1 970 1 970Bid Corporate Services (Pty) Limited# * 100 100 – – 52 52 Bid Corporation (Pty) Limited * 100 100 1 073 583 1 294 987 1 230 549Bid Corporation Off shore Investments Limited(20) 16 100 100 – – – – Bid Foodservice Products Division (IOM) Limited(20) * 100 100 – – – – Bid Industrial and Commercial Products (IOM) Limited(20) * 100 – – – – –Bid Industrial and Commercial Products (Pty) Limited * 100 100 – – – –Bid Industrial Holdings (Pty) Limited * 100 100 104 777 68 212 203 468 153 900Bid Property Holdings (Pty) Limited * 100 100 – – 11 883 17 996Bid Services Division (Pty) Limited * 100 100 182 86 580 500 576 436Bid Services Division (UK) Limited(4) * 100 100 – – – – Bidcorp Finance Limited(20) * 100 100 – – – – Bidcorp Limited(4) 14 100 100 – – – – Bidvest (UK) Limited(4) * 100 100 – – – – Bidvest International Limited(20) * 100 100 – – – – Bidvest Namibia Limited(7) * 100 100 – – 70 010 –G. Fox Properties (Pty) Limited * 100 100 802 802 – – Jacobs Investments Limited(4) * 100 100 – – – – Namsov Holdings (Pty) Limited(7) 1 59 62 – – – – Primeinvest 5 (Pty) Limited * 100 100 – – 327 781 325 136Promoter International Limited(4) * 100 100 – – – – Siki Fox Properties (Pty) Limited * 100 100 1 000 1 000 – – Silveray Properties (Pty) Limited * 100 100 8 833 8 833 – –Skillion Limited(4) 14 100 100 – – – – The Globe Foundry (Pty) Limited 32 100 100 1 234 1 234 – – Waltons Properties Namibia (Pty) Limited(7) 1 100 100 4 001 1 – – Other 482 993 480 189 (270 036) (300 691)

2 838 505 2 782 684 2 407 703 2 190 140

Major joint ventures Aeromaritime International Management Services (Pty) Limited(C) 4 50 50 – – – – Cape Town Bulk Storage (Pty) Limited(C) 1 000 50 50 – – – – Ebony Travel (Pty) Limited(B) * 49 49 – – – – Ensimbini Terminals (Pty) Limited(C) 2 50 50 4 540 4 540 – – Rollex Transport (Pty) Limited(C) * 50 – – – – – Voltex Swaziland (Pty) Limited(19)(G) * 50 50 – – – –

4 540 4 540 – –

Major associates Compu-Clearing Outsourcing Limited(C) 400 25 25 6 928 8 806 – – Enviroserv Holdings Limited(F) 1 063 33 33 43 697 47 466 – – Harvey World Travel Southern Africa (Pty) Limited(B) * 50 50 3 464 3 464 – – Imperial McCarthy (Pty) Limited(H) 1 50 50 – – – – Master Currency (Pty) Limited(B) 1 45 45 31 760 31 760 – –Sebenza Forwarding & Shipping Consultancy (Pty) Limited(C) * 45 45 5 011 5 011 – – Silapha Offi ce Products (Pty) Limited(D) * 25 25 20 20 – – Supaswift (Pty) Limited(C) * 36 36 – – 20 000 20 000Tiger Automotive Limited(H) 596 20 20 – – – – Ubuhle Be Dauphin Offi ce Seating (Pty) Limited(D) * 28 28 – – – –Waltons Mozambique Limitada(12)(E) * 50 50 – – – –Yeastpro (Pty) Limited(A) * 25 25 32 381 32 381 – – Other 17 075 6 091 95 95

140 336 134 999 20 095 20 095

Amounts owing by or to subsidiaries, joint ventures and associates are unsecured, interest free and have no fi xed terms of repayment.

*less than R1 000#Trading as an agent

Country of incorporation if not South Africa Nature of business of joint venture and associates(1)Hong Kong (2)Singapore (3)United States of America (4)United Kingdom (5)Australia (6)Botswana (7)Namibia (8)New Zealand(9)Belgium(10)Netherlands

(11)United Arab Emirates(12)Mozambique(13)Malawi(14)Democratic Republic of Congo(15)Zambia(16)Zimbabwe(17)Mauritius(18)Seychelles(19)Swaziland(20)Isle of Man

(A)Catering supplies, food and allied products(B)Travel, fi nancial and related services(C)Freight, forwarding, clearing, distribution, warehousing and allied activities(D)Offi ce furniture, supplies and related products(E)Printing and stationery products(F)Linen, rental, laundry, cleaning and other services(G)Electrical, security and related products(H)Motor retail and related services



Shareholdersas at June 30 2007

Number ofshares

%holding

%effectiveholding

Major shareholders

Owner list

Major shareholders holding in excess of 1% of the issued capital of the Company, as per the share register and information supplied by nominee companies:

Public Investment Corporation Limited (SA) 46 082 934 13,9 15,2

Dinatla Investment Holdings (Pty) Limited 27 001 744 8,2 8,9

BB Investment Company (Pty) Limited 23 523 732 7,1

Income Fund of America Inc. 10 055 000 3,0 3,3

Old Mutual Life Assurance Company (SA) Limited 8 285 101 2,5 2,7

Investment Solutions Limited 7 467 379 2,2 2,5

Liberty Life Association of Africa Limited 5 523 154 1,7 1,8

New Perspective Fund Inc 5 500 000 1,7 1,8

Momentum Life Assurance Limited 4 834 702 1,5 1,6

Sanlam Lewensversekering Beperk 4 525 026 1,4 1,5

Nedbank Rainmaker Equity Fund 4 258 372 1,3 1,4

European Pacific Growth Fund 3 545 000 1,1 1,2

Investec Value Fund 3 450 889 1,0 1,1

JDL Holdings (Pty) Limited 3 363 429 1,0 1,1

First National Bank Pension Fund 3 212 424 1,0 1,1

160 628 886 48,6 45,2

Manager list

Major fund managers investing in excess of 1% of the issued capital of the Company, as per the share register and information supplied by nominee companies:

Public Investment Corporation Limited (SA) 28 367 210 8,6 9,4

RMB Asset Management (Pty) Limited 26 684 506 8,1 8,8

Investec Asset Management (Pty) Limited 26 509 587 8,0 8,7

Capital Research and Management Inc. 21 179 500 6,4 7,0

Sanlam Investment Management (Pty) Limited 15 068 320 4,6 5,0

Old Mutual Asset Managers (South Africa) (Pty) Limited 14 341 502 4,3 4,7

Stanlib Asset Management Limited 11 800 529 3,6 3,9

Genesis Investment Management LLP 10 421 983 3,1 3,4

Polaris Capital (Pty) Limited 6 060 233 1,8 2,0

Coronation Fund Managers (Pty) Limited 5 229 423 1,6 1,7

Foord Asset Management (Pty) Limited 5 211 490 1,6 1,7

Investec Securities (Pty) Limited 4 772 405 1,4 1,6

Prudential Portfolio Managers (Pty) Limited 3 671 728 1,1 1,2

Barclays Global Investors Limited 3 374 379 1,0 1,1

Futuregrowth Asset Management (Pty) Limited 3 292 920 1,0 1,1

Cadiz African Harvest Asset Management (Pty) Limited 3 242 750 1,0 1,1

Metropolitan Asset Managers (Pty) Limited 3 195 824 1,0 1,1

192 424 289 58,2 63,5

Shares in issue

Total number of shares in issue 330 753 967

Treasury shares (27 902 182)

Effective shares in issue 302 851 785


Effective empowerment holdings

Black ownership, calculated in terms of the principles and using the methodology contained in the gazetted codes of good practice, excluding mandated investments (such as ownership by pension funds, unit trusts and medical aid funds, to a maximum of forty percent) and ignoring the value of its non-South African business, is 26,7% with black women ownership of 13,7%.

The Dinatla transaction was at holding company level, including both local and off shore operations.

Empowerdex certificate in the 2007 sustainability report

Number

of shares %

Analysis of shareholders

Type of shareholder

Pension funds 98 385 161 29,7

Corporate holdings 27 001 744 8,2

Insurance companies 30 668 988 9,3

Unit trusts 86 002 059 26,0

Private investors 19 469 308 5,9

Other managed funds 39 885 014 12,1

Overseas banks and custodians 1 439 511 0,4

Treasury shares 27 902 182 8,4

330 753 967 100,0

Location of benefi cial shareholders

South African private investors 19 469 308 5,9

South African registered funds 181 808 165 55,0

Foreign registered funds 74 572 568 22,5

South African corporate 27 001 744 8,2

Treasury shares 27 902 182 8,4

330 753 967 100,0

Shareholder spreadNumber of

shareholders %Number

of shares %

1 – 10 000 14 116 93,2 12 685 800 3,8

10 001 – 50 000 598 3,9 14 070 524 4,2

50 001 – 100 000 160 1,1 11 181 873 3,4

100 001 – 500 000 194 1,3 43 243 674 13,1

500 001 – 1 000 000 34 0,2 22 710 400 6,9

1 000 001 – 5 000 000 33 0,2 75 913 165 23,0

Above 5 000 000 9 0,1 150 948 531 45,6

15 144 100,0 330 753 967 100,0

Management directory


Corporate Services

BID CORPORATE SERVICES

Non-executive chairman C Ramaphosa

Chief executive B Joff e

Group fi nancial director D Cleasby

Group executive director P Nyman

Group commercial executive S Mahlalela

Group services D Koff

Group communications and Bidvest Academy

J Hochfeld

Group fi nancial N Goodwin

Group company secretarial M David

Group taxation C Kourie

Group internal audit B Smith

Group accounting P Roberts

Y Strydom

Communications manager J Davidson

Bidvoice and internet J Meilhon

Bidvest Isle of Man J Unsworth

Bidvest United Kingdom S BenderP ScottA Oliver

BID PROPERTY HOLDINGS

Managing director I Menashe

General manager H Huneberg

NAMIBIAN FISHING

Managing director J Arnold

ONTIME AUTOMOTIVE

Managing director D Brinklow

Financial director S Mclaughlan

Bidfreight

Chief executive A Dawe

Financial director M Steele

Divisional fi nancial manager D Van Staden

Divisional accountant E Brown

Internal audit P Premchand

BIDFREIGHT TERMINALS

Managing director A Dawe

Financial director M Steyn

Business development director A Lax

4 Bulk Connections

Managing director I Geldart

Financial director J Pillay

Engineering director A Bedingham

Operations director B Deghaye

4 Island View Storage

Managing director K Ehlers

Financial director A Hansen

Commercial director G Shafer

Operations director J Joubert

Human resources director B Ndlovu

4 Bidfreight Port Operations

Managing director J Roux

Financial director R Sukdeo

Commercial director R Carson

Operations directors B CareyN WatsonM SymesJ GoodwinW Mzamo

4 Rennies Distribution Services

Managing director D Leisegang

Financial director N Mbongwa

Commercial director S Smith

Operations director T Wilkinson

4 SACD Freight

Managing director G Peinke

Financial director N Bray

Regional directors Cape Town R Buchanan

Durban M Martin

Gauteng D Trotter

4 South African Bulk Terminals

Managing director K Smith

Financial director M Bessick

Operations director H Lourens

Human resources director K Kelly

4 Naval

Managing director L Goncalves

INTERNATIONAL CLEARING AND FORWARDING

4 Safcor Panalpina

Managing director P Williams

Financial director A Soma

Human resources director S McSweeney

Sales and marketing director B Thoresson

IT director J Tennant

Product development director C Speed-Andrews

Regional directors Gauteng M Du Preez

KwaZulu-Natal J Cummins

Eastern Cape D Rothman

Western Cape M Cookson

4 Sebenza Forwarding and Shipping Consultancy

Managing director N Mogorosi

Group operations director F Van Wyk

Financial manager K Mkhize

MARINE SERVICES

4 Rennies Ships Agency

Managing director J Reddy

Financial director S Munilal

Liner director C Mountjoy

Marketing director A Kee

Port Operations directors Cape J Whittington

KwaZulu-Natal G Stevenson


4 Marine Insurance

Rennie Murray

Managing director R Breckwoldt

P & I Associates

Managing director A Reid

Freightbulk

Managing director DJ Reddy

MANICA AFRICA

Managing director M Günther

Financial executive S Charlton

Manica South Africa

Managing director P Carter

Manica Group Namibia

Managing director H Timke

Manica Malawi

Managing director R Barford

Manica Botswana

General manager P Carter

Manica Zambia

General manager D Doyle

Manica Zimbabwe

Managing director A Kamhunga

Bidserv

Chief executive L Ralphs

Financial director P Meijer

Commercial director L Jacobs

Services director J Taylor

Financial operations director K Wakeford

PRESTIGE CLEANING SERVICES

4 Prestige Group

Managing director D Otto

Financial director B Gosai

Operations director J du Toit

Marketing and sales director R White

Human resources director P Roux

Divisional fi nance director M Kourie

Divisional fi nance executive E Steyn

Divisional IT executive R Shepard

Divisional training executive L Steyn

Divisional operations executive T Van Zyl

Divisional operations executive A Pretorius

Divisional operations executive J Potts

Divisional operations managing directors

Northern J Dames

Central and food production V Singh

Central A Pretorius

Southern C Labuschagne

Hospitality N Hall

Healthcare S Bell

KwaZulu-Natal C Maguire

Cape Coastal E De Kok

Operations general managers

Bloemfontein G Macleod

East Rand S Coetzee

Food Hygiene D Steyn

West Rand A Maritz

Hospitality KwaZulu-Natal HP Merensky

Johannesburg K Moore

Pretoria K Nicholson

First in Staffi ng Solutions Johannesburg T Overbeck

Healthcare Johannesburg ll K Reid

Johannesburg l C Goss

Pretoria I Oosthuizen

KwaZulu-Natal L Marlow

Healthcare and Hospitality Western Cape M Hulley

North Coast A Rowe

South coast M van der Merwe

Mpumalanga (Highveld)

J Cunningham

Mpumalanga (Lowveld)

C Van der Merwe

Midrand W Butterworth

North Rand J van Deventer

Northwest M Marais

Port Elizabeth A Fulton

Pretoria L Swart

South Rand N Prinsloo

Vaal D de Klerk

Welkom C Lamprecht

Cape Town V Vassilev

Richards Bay S Gibb

Rustenburg M Medallie

Pietersburg/ Polokwane

M Van Rooyen

Pietermaritzburg B Alston-Stewart

Floorcare division J Le Roux

Window cleaning division F Schutte

Technical manager E Mathews

Procurement manager R Govender

Business development manager G Dludla

Quality and safety manager C Barratt

Customer relations manager J Kalkwarf

Sales Support Johannesburg E Phelps

Divisional Sales

Hospitality/Food hygiene/Education

T Valentine

Healthcare/Retail J De Villiers

Southern/Free State division J Nel

Northern and projects A Dippenaar

Commercial E Van den Bergh

Sales directors

KwaZulu-Natal W Bowen

Cape Coast S Fulton

Financial directors

Support centre Corporate S Greyvensteyn

KwaZulu-Natal B Cubbitt

Cape Coastal V Chetty

Northern S van Schalkwyk

Southern K Forte

Central 1 N Gomes

Central 2 A Smit

Hospitality I Neermal

Healthcare S De Oliveira

Credit control M de Swardt



Managers Kimberley K Theron

Evander T Nel

Pretoria G Swanepoel

Welkom C Lamprecht

South Rand S Bloem

East Rand J Hills

Rustenburg L Joubert

Johannesburg Hospitality

A van der Merwe

Pretoria Hospitality A Ndlovu

Pretoria Healthcare A Goldridge

Pretoria Hospitality W Breytenbach

Western Cape J FleisherR Jason

North Rand M MansA Norris

Midrand D CooperP LynchA DykeE Erasmus

West Rand R Jacobs

Window cleaning A Olivier

KwaZulu-Natal North Coast

B Faulkner

KwaZulu-Natal Healthcare

J van Tonder

George P Labuschagne

TMS GROUP INDUSTRIAL SERVICES

4 TMS Group

Managing director M Dreyer

Financial director D Kahts

Marketing manager W Pretorius

Manufacturing, repair and maintenance director

J Huisamen

Industrial relations and corporate social investment director

D Mathonsi

4 Industrial Cleaning

Managing director J Venter

4 Manpower & Legal

Managing director L Moreno

4 Topfl ight Hydraulics

Managing director J Venter

4 SPI (Scaff olding, Painting and Insulation) Managing director H Stopforth

LAUNDRY SERVICES

4 Boston Launderers/First Garment Rental/Montana Laundries/

Managing director A Fainman

Financial director J Wilson

Managing director Boston H Hunnik

Managing director First Garment Rental

C Gibbons

Managing director Montana B Shirley

FGR regional managers Inland C Verster

Cape Town M Franken

Durban L De Beer

Port Elizabeth D Pitt

Boston regional managers Durban S Heath

Sun City C Botha

Cape Town C Field

Zambia D Khan

Guest A Coates

Spartan P Barros

STEINER GROUP

Managing director N Smith

Financial director T Scruse

Sales director R van Rooyen

Commercial and marketing director

T Hlapi

4 Steiner Group – Botswana

Managing director R Wakefi eld

4 Steiner Group – Mozambique

Managing director C de Gouveia

4 Steiner Hygiene

Managing director P Dunn

Operations director E Barnard

Financial director A Greene

Sales director T Van Wyk

Trading sales director F Stroh

Regional sales directors Coastal region D Kroutz

Inland region L Van Vuuren

Regional operations directors Coastal region E Grove

Inland region M Markram

Regional fi nancial directors Inland region S Liebenberg

Branch managers Aeroport S Pienaar

Benrose D Palm

Bloemfontein B Beck

Boksburg C De Villiers

Brackenfell C Basson

Centurion A Drummond

Durban A Botha

East London V Ngoqo

Ermelo P Muller

George M Pretorius

Kimberley J Thuynsma

Kya Sands K du Plessis

Maputo C de Gouveia

Montague Gardens

T van der Westhuizen

Ndabeni L Stijlen

Nelspruit C Moff ett

Newcastle P Muller

Pietermaritzburg I Konstandakellis

Polokwane T Dryden-Schofi eld

Port Elizabeth L Bruwer

Potchefstroom K Odgers

Pretoria West N Van Rooyen

Richards Bay D Adamson

Rustenburg M Beyl

Swaziland A Ntiwane

Vereeniging G Rudman

Welkom A Kilani

Witbank P Muller


4 Puréau Fresh Water Company

Managing director R Tyack

Financial director G Finch

National sales manager C Hoff mann

Operations manager A Duvenhage

Branch managers East Rand L Du Plessis

Pretoria C Murray

Durban M Neale

Cape Town S Buser

West Rand R Mamafa

North Rand T Schmidt

4 Execufl ora

Managing director R Strang

Sales manager J Burger

Branch managers East Rand S Van Zyl

North Rand T Maree

Durban P Hildyard

Cape Town J Du Toit

Silk Flowers V White

4 Steiner Environmental Solutions

Managing director R Hagerty

Operations manager A Retief

Branch managers Johannesburg J Jansen

Pretoria F Coetzer

Durban C Seaman

Cape Town A Hepburn

BIDSERV INDUSTRIAL PRODUCTS GROUP

Managing director S Xenophon

Financial director A Muir

4 G. Fox & Company

Managing director S Laser


Sales manager B Booysen

Operations manager R Cohen

Branch managers Port Elizabeth I Crane

Middleburg J Kukard

4 Commercial Sundries



Branch managers Johannesburg P Rice

Cape Town H Axsel

Durban C Henstock

Pietersburg R Prins

4 Clockwork Clothing



Operations director R Sparks

4 Giant Clothing



General manager P Schoeman

Operations manager R Sparks

GREEN SERVICES

4 Topturf Mauritius

Managing director P Kirkby

4 Topturf Botswana

Managing director D Kirkby

4 Topturf Swaziland


4 Topturf Zambia


4 Topturf Seychelles

Managing director P Kirkby

4 Topturf Group


Divisional directors Landscape contracting

J Ferguson

Landscape maintenance

T Cooke

Industrial landscape maintenance

J Rautenbach

Mauritius & Seychelles business unit

P Kirkby

Northwest and Swaziland business unit

J Kirkby

Finance A Kotze

Irrigation manager B Manson

Golf courses and sports turf maintenance manager

M Hildebrand

Human resources manager O Koornhof

Branch manager Durban D Aucamp

AVIATION SERVICES

4 Bidair Services

Managing director P Bergs

Finance director A Howie

Marketing executive R Gurr

4 Optima Handling Services

Senior executive L Pillay

Senior executive G Boxall

4 Airport Handling Services

Managing director P Bergs

Finance executive R Balona

Operations manager G Vorster

Marketing executive B Gurr

4 Express Air Services

Managing director F Wolmarans

Commercial and domestic director

R Solomons

4 Aerospace Handling International

Operations manager W Meyer

4 Aviation Security International

Senior executive A Olivier

Senior executive P Van Baalen



4 Premier Club Airport Lounges

Senior executive T Meyer

4 Aviation Academy for Southern Africa (AAFSA)

Senior executive D Viljoen

4 Commuter Handling Services

Senior executive E Linley

BIDRISK SOLUTIONS

4 Magnum Shield

Managing director D Crichton

Financial director A Still

Regional directors Gauteng Central M Leonard

Gauteng North J Nell

Western Cape R Clarke

Eastern Cape M Roberts

KwaZulu-Natal B McGeary

4 Vericon Outsourcing

Managing director G Gericke

Commercial director C Reed

Human resources director N Williams-Naidoo

4 Provicom Risk Solutions

Managing director S van Aswegen

Financial director A Shiba

Sales and marketing director S van Huysen

Operations director and technical director

B Spence

Divisional directors KwaZulu-Natal S Moodley

Port Elizabeth S Reid

East London G Brandt

Pretoria F Schmidt

Cape Town G Trompeter

4 Out The Square

Managing director G Moore

Sales and marketing director T Pietersen

GLOBAL PAYMENT TECHNOLOGIES

Managing director T Chamberlain

Financial director S van Huyssteen

Sales director W van Vuuren

BUSINESS SOLUTIONS AND GROUP PROCUREMENT

4 mymarket.com

Managing director P Katz

Operations manager P Morel

Communications manager J Davidson

IT director B Painting

Travel manager G Gerber

Sales manager W Muirhead

4 Bidprocure

Group procurement manager R Govender

OFFICE AUTOMATION

4 Konica Minolta South Africa

Managing director A Griffi th

Finance manager I Keshwar

Administration manager M Holahan

Technical manager A Barbosa

4 Océ

Managing director K Dix-Peek

Finance manager C Nel

General managers

Marketing and sales P Enslin

National service manager G Hall

BIDTRAVEL

Managing director A Lunz

IT director D Tagari

4 Carlson Wagonlit Travel

Managing director B Langer

Financial director C Mitchley

Information technology manager

H Seedat

Operations director A Gray

Sales and account management director

M Martins

4 HRG Connex Travel

Managing director K Makhetha

Financial director JS Van Staden

4 Ebony Travel

Managing director S Figlan

4 Harvey World Travel (SA)

Managing director N King

4 Prestige Travel

Managing director S Figlan

4 HRG Rennies Travel

Chairman A Lunz

Managing director K Harris

Financial director L Ledwaba

National operations director P Holmes

Commercial director R Lawlor

Business development director B Philipps

4 HRG Rennies Travel Namibia

Managing director H Schultz

4 HRG Rennies Travel and Foreign Exchange Malawi

Operations manager S Chikaunda

4 HRG Rennies Travel Zimbabwe

Managing director RJ Lawlor

Operations director L Valler

4 Travel Connections

Joint managing director G Zilk

Joint managing director L Preston

4 Travelwise Botswana

Managing director F McDonald

4 World Travel

Managing director B Langer

Financial director M Van Jaarsveld


BANKING SERVICES

4 Bidvest Bank Limited

Managing director A Salomon

Financial director L de Waal

Treasury and corporate banking director

G Bower

Enterprise wide risk director A Vermaak

Payments and settlements director

J Murtagh

Compliance offi cer D Crawley

RENNIES FOREIGN EXCHANGE

Retail operations director C MacFarlane

FOREIGN EXCHANGE SERVICES

4 Master Currency

Managing director A Jacobson

4 Rennies Foreign Exchange Botswana

Supervisor M Kepadisa

4 Rennies Travel Holdings Malawi

Area manager S Chikaunda

4 Namibia Bureau de Change

Area manager S van der Westhuizen

HOTEL AMENITIES AND ACCESSORIES

4 Hotel Amenities Suppliers

Managing director C Leibbrandt

Sales director C Vas-Diass

Financial manager M Coates

Operations manager M Melville

4 Promo Sachets and Steri Pic

Managing director N Taitz

Financial manager M Coates

Bidvest Europe

Chief executive F Barnes

3663 FIRST FOR FOODSERVICE UNITED KINGDOM

Chief executive F Barnes

Commercial director I Crawford

Sales director A Kemp

Finance director I Uren

IT director J Scott

Marketing director D Bell

Multi-Temperature

Managing director A Fisher

Finance director M Tyler

Multi temp business development director

N Wemyss

Catering equipment managing director

P Knight

Regional directors K JacksonB RogersS Rich

Frozen & Fresh

Managing director N Wemyss

Financial director A Brogan

Swithenbanks managing director

A Watson

Regional directors D SibleyB RowlandA Tiplady

Logistics

Managing director A Selley

Finance director C Jones

Client relations director H Wilkinson

Operations director S Foley

Central services

Central fi nance director W Hope

Business systems director A Brierley

Client services director C Lewis- Burling

Quality director M Holmes

Operation services director D Morgan

Transport director G Rennie

Buying director A Roberts

Human resources director H Angus

Business change director C Carter

The Barton Meat Company

Business development TBMC & Swithenbank food director

A Ball

Finance director M Sanderson

Operations director S Hallows

DELI XL – BELGIUM

Managing director T Legat

Operations manager P Delsaert

Buying director V Lacassin

Sales director L Delaude

Finance director L Lioulas

DELI XL – NETHERLANDS

Managing director D Slootweg

Finance director B Heinemann

Chief operating offi cer H van der Ster

HORECA TRADE – UNITED ARAB EMIRATES

Managing director H Al Jamil

Finance director R Chirukandath




Chief executive B Berson

BIDVEST AUSTRALIA LIMITED

Foodservice managing director K Bielby

National marketing and purchasing director

A Fechner

National accounts manager L Vorano

Operations manager Regional R Simpson

Operations support manager R Peterson

Operations support manager R Redfern

QSR and hospitality divisional executive

R Wainer

Hospitality manager K Rogers

Information systems manager G de Sylva

Chief fi nancial offi cer B Plit

Financial controllers: Central R Romano

North A Daniel

South P Wright

National credit B Boreham

Branches Adelaide P Moore

Adelaide John Lewis foodservice

T Murdoch

Albury A Lewis

Armidale and Tamworth

G Jackson

Brisbane M West

Cairns P North

Canberra M Moullakis

Central Coast P Tucker

Geelong R Barnes

Gold Coast D Lloyd

Coff s Harbour R Walker

Mackay S Welsh

Hervey Bay G Convery

Melbourne A Sprigg

Newcastle S Collins

Perth C Miller

Sunshine coast G Phillips

Sydney E Rose

Sydney F Renda

Townsville D Kippin

Toowoomba C Files

Darwin R Prasad

Ipswich B Harris

Hospitality supplies Adelaide

G Cordingley

Hospitality supplies Melbourne

G Croft

Hospitality supplies Brisbane

F Shanahan

Hospitality supplies Sydney

J Lawecki

Hospitality supplies Geelong

P James

Hospitality supplies Perth

G Hile

Wollongong M Mertens

QSR Sydney C Lillicrap

QSR Melbourne D Leibowitz

QSR Adelaide J Manca

QSR South Qld S Tomlinson

BIDVEST NEW ZEALAND

Managing director N Boswell

Finance manager P Ballantine

Business development manager M Bodman

National procurement manager M Simpson

IT manager M Dorward

4 Bidvest Logistics

General manager G Crean

4 Crean Foodservice

General manager P Struckmann

Branches: Auckland M Wright

Christchurch G McGale

Dunedin B McPhee

Hamilton G McGregor

Hawkes bay B Adshead

Invercargill R Oosterbroek

Nelson R Bell

New Plymouth A Hay

Palmerston North N Rapson

Queenstown N Imlach

Roturua K Buckthought

Timaru G Parkin

Wellington D Magrath

Whangarei S Hunt

4 Fresh Foodservice Fresh Auckland S Kent

Fresh Christchurch R Hallissey

Fresh Hamilton D Slack

Fresh Rotorua W Wickham

Fresh Wanaka B Wilson

Fresh Wellington R Young

ANGLISS SINGAPORE

Managing director Beng Fong Loke

ANGLISS HONG KONG AND CHINA

Managing director J Kang

Bidfood

CATERPLUS

Managing director B Varcoe

Human resources director M Lockley

Human resources manager E Motsiri

Sales and marketing director C Watt

Sales and marketing manager D Sparks

Financial manager M Smith

Africa

4 Caterplus Botswana

General manager B Pieterse

Financial manager B Champane

Sales manager T Pieterse

Operations manager T Pheko

Buyer D O’Neill

4 Caterplus Namibia

General manager L Geyser

Financial manager C Van Wyk

Sales manager G Van Wyk

Operations manager A Martins


4 Caterplus Inland Region

Inland operations manager R Seaward

Inland fi nancial manager A Bischoff

4 Catersales

Managing director E Eagar

Financial manager W Venter

Sales director K Ross

Operations manager J Lazenby

Buyers D BritzT Tshwahlane

4 Blue Marine Johannesburg

General manager G Bian

Financial manager K Fourie

Operations manager C Molefe

Buyer J Petch

4 Chipkins Catering Supplies Johannesburg

General manager R Lyon

Financial manager H Strydom

Sales manager J Van Der Westhuizen

Operations manager D Nourse

4 Chipkins Catering Supplies Nelspruit

General manager C Lee

Financial manager I Grobelaar

Sales manager W Munro

Operations manager J Parmiter

Buyer D Grobler

4 Chipkins Catering Supplies Polokwane

General manager M Mtika

Financial manager L Broekman

Operations manager C Mncube

Buyer F Gerrits

4 D & R Lowe Catering Supplies

Managing director C McCormack

Financial manager A Changuion

Sales director N Papas

Operations manager F Uys

Buyer T Pillay

4 Lou’s Wholesalers

Managing director E Webster

Financial manager J Le Roux

Sales manager D Sayer

Operations director B Sibanda

Buyer B Hall

4 M & M Quality Choice

Managing director F da Silva

Financial manager V Manyenge

Sales manager C Danilowitz

Operations manager R Oberholster

Buyer R Glintenkamp

4 Seaworld Frozen Foods Johannesburg

General manager K Kohler

Financial manager L Bronkhorst

Sales manager P Duncan

Operations manager B Cassere

4 Seaworld Frozen Foods Nelspruit

General manager A Brower

Financial manager C Friend

Sales manager C Cooper

Operations manager P Wagenar

Buyer F Van Heerden

4 Seaworld Frozen Foods Polokwane

General manager N Myburgh

Financial manager T Janse Van Rensburg

Operations manager K Idensohn

4 Eastern Cape and Free State Region

Operations manager A Roberts

Financial manager M Van Wyk

Key accounts director A Botha

4 Chipkins Catering Supplies Bloemfontein

Managing director R Ramos

Financial manager S Labuschagne

Sales manager O Botha

Operations manager E Mellet

Purchasing director M Malherbe

4 Chipkins Catering Supplies East London

General manager M Meyer

Fiancial director R Hechter

Sales manager G Barnard

Operations manager P Zwane

Buyer L Postman

4 Chipkins Catering Supplies George

General manager F Bekker

Fiancial manager H Herholdt

Sales manager

Operations manager D Phillips

Buyer M Groenewalt

4 Chipkins Catering Supplies Catering Port Elizabeth

Managing director A McLeod

Financial director P Gouws

Sales manager C Marx

Operations manager R Weideman

Buyer C Widdburn

4 East Cape Foods

Managing director A Roberts

Sales manager M Smit

Operations manager J Jansen

Buyer Y VD MerweD Du Preez

4 Seaworld Frozen Foods Bloemfontein

General manager A Rheeder

Fiancial manager E Killian

Operations manager L Daff ue

4 KwaZulu-Natal region

Operations director N Yeats

Financial manager N Munro

Key accounts manager C De Beer



4 3663 First for Foodservice

General manager T Ferreira

Financial manager G De Bruin

Sales manager G Dudley

Operations manager R Naidoo

Buyer C Jankiepersadh

4 Blue Marine Durban

General manager C Murray-Rawbone

Financial manager R Swart

Sales manager T Papworth

Operations manager A Sathiram

Buyer K Deokaran

4 CCW Catering Supplies Empangeni

Managing director L Govender

Financial manager C St Clair Mulley

Sales manager S Coetzee

Buyer J Viljoen

4 CCW Catering Supplies Pietermaritzburg

Managing director N Yeats

Financial manager N Munro

Sales manager A Pillay

Purchasing director R Govender

4 Chipkins Catering Supplies Durban

Managing director R Lowe

Financial director C Palmer

Sales director B Mathura

Operations manager V Moonsamy

Purchasing director S Naicker

4 Western Cape Region

Operations director D Smit

Financial manager M Manca

Key accounts manager S Horwitz

4 Blue Marine Cape Town

General manager T Prinsloo

Financial manager M Grey

Sales manager C Burger

Operations manager G Jooste

Buyer P Troupe

4 Chipkins Catering Supplies Cape Town

Managing director D Smit

Financial manager A Van Der Merwe

Sales manager P McNulty

Operations manager J Pretoriu

Buyer C Van Coller

4 First Food Distributors

General manager C Webb

Financial manager S Smit

Sales manager T Dawson

Operations manager J Bailey

Buyers A AmadienT Teixeira

4 RFS

Managing director R Van Vlaanderen

Financial director J Van Zyl

Sales manager D Malan

Operations manager M Bekker

Purchasing director N Jattiem

4 Seaworld Frozen Foods Cape Town

General manager L Fouche

Financial manager M Manca

Sales manager E Smith

Operations manager A van Meerbergen

Buyer D Fergusen


Chief executive M Berzack

Financial director E Immermann

Commercial director SA Thwala



Marketing and procurement director

C Esterhuizen

Legal director S Green

Financial director E Immermann

Berzack Brothers director R Berzack

Administrative director D Mare

Administrative director N Chiba

Non-executive director L Jacobs

North East Region branches

Regional manager T Flaherty

Electric Centre

Branch manager Pretoria E Sam

Globe Electric

Branch manager Witbank C Stols

Keens Electrical

Branch/depot manager Montana A Robertson

Branch/depot manager Olympus P Kruger

Branch manager Pretoria M Cameron

Voltex Electrical

Branch manager Centurion P Schuurman

Branch/depot manager Hazyview W du Toit

Branch/depot manager Lydenburg J Hamman

Branch manager Nelspruit L van HeerdenH Schoeman

North West Region branches

Regional manager C Alley

Electric Centre

Branch/depot manager Phalaborwa E de Wet

Branch manager Tzaneen H Steyn

Keens Electrical

Branch manager Klerksdorp A Goosen

Branch manager Rustenburg C Heyneke

Voltex Electrical

Branch manager Potchefstroom P Potgieter

Northern region specialised

Regional manager M van Schalkwyk

Atlas Cables

Branch manager Polokwane K de Kok


Voltex retail suppliers

Branch manager Rayton M Herbst

Gauteng branches

Regional manager D Blumgart

Electric Centre

Branch manager West Rand A Lightfoot

Branch manager East Rand A Boshoff

Depot manager Midrand M Storer

Globe Electrical

Branch manager Benrose A Botha

Depot manager Kensington A Botha

Depot manager Kempton A BothaK Smith

Keens Electrical

Branch manager Springfi eld G Cunningham

Litecor Electrical

Depot manager Alberton A Strydom

Branch manager Randburg A Baig

Branch manager Reuven K PearmanT Turnbull

Voltex Electrical

Branch manager Bramley J MurphyG Jacks

Branch manager Newcastle G Nel

Branch manager Vereeniging H Venter

Independent

Voltex Industrial Systems

Branch manager Midrand L van der Schyff

KwaZulu-Natal branches

Regional manager K Draper

Electric Centre

Branch manager Durban K Draper

Litecor Electrical

Depot manager Avoca D Thulasaie

Litecor Lighting

Depot manager Durban G Paterson

Voltex Electrical

Branch manager Briardene G Paterson

Depot manager Ballito A Sheik

Depot manager Hillcrest R Maharaj

Branch manager Pietermaritzburg R Ramdhin

Branch manager Pinetown G Elliott

Branch manager Richards Bay S Ross

Branch manager Warehouse A Pitt

Voltex retail suppliers

Branch manager Durban N Van Loggerenberg

Waco Industries


Free State branches

Regional manager G Grant

Globe Electrical

Branch manager Welkom D Kruger

Litecor Electrical

Branch manager Bloemfontein C Thompson

Branch manager Kimberley E Johnston

Voltex Transmission & Distribution

Sales Manager Bloemfontein K Cilliers

Western Cape branches

Regional manager D Barrie-Smith

Crew Electrical

Depot manager Salt River S Moodaly

Electric Centre

Branch manager Worcester R Ruthenberg

Globe Electrical

Branch manager Windhoek H Lingner

Branch manager Oshakati M Nagel

Independent specialist

Bellco

Branch manager Cape Town H Ward

Voltex Electrical

Branch manager Upington E ThirionM Fransman

Depot manager Blackheath C Ockhuis

Branch manager Cape Town W Smith A Gamba

Branch manager Paarl J Arendse

Depot manager Strand V Grovers

Branch manager West coast C Mathews

Branch manager Wetton N Murray

Voltex Retail Suppliers

Branch manager West coast K Theunissen

Atlas Cables Cape Town B TaylorD Sooknunan

Voltex Tygerberg

Branch manager Parrow Valley D Collins

Crew Electrical

Depot manager S Moodaly

Globe Electrical

Branch manager Windhoek H Lingner

Branch manager Oshakati M Nagal

Bellco Electrical

Managing director H Ward

Lighting director R Lowe

Eastern Cape branches

Regional manager C Boltar

Electric Centre

Depot manager Umtata R Pillay

Voltex Coland

Branch manager East London R Pillay

Voltex Electrical

Branch manager George R Scholtz

Depot manager Jeff reys Bay A van Niekerk

Depot manager Knysna C Robinson

Branch/depot manager Mossel Bay J Campher

Branch/depot manager Oudtshoorn C Jones

Branch manager Port Elizabeth A van der Vyver

Depot manager Uitenhage H Wilson

Voltex Retail

Branch manager East London R PillayM Plaatjies

Specialist divisions

4 Atlas Cable Supplies

General manager Alrode C McDonald

Depot manager Tygerberg D Sooknunan

Branch manager Polokwane K de Kock



4 Association Cables

Branch manager Alrode M Rall

4 Voltex Transmission & Distribution

Branch manager Alrode G du Plooy

Branch manager Durban N Yates

Depot manager Bloemfontein K Cilliers

4 Versalec Cables

Branch manager Midrand T Schmidt

4 Cabstrut Branches

General manager Johannesburg J Louw

Branch manager Cape Town A Bodechtel

Branch manager Durban F Jacobs

Depot manager Pretoria D van Zyl

Northern region specialist branches

Supervisor M van Schalkwyk

4 Atlas Cable Supplies

Branch manager K de Kock

4 Voltex retail suppliers

Branch manager M Herbst

Branch manager J Meyer

4 Waco Industries branches

General manager Cleveland J Lipson

Branch manager Bloemfontein E Ackermann

Branch manager Cape Town R Human

Branch manager Port Elizabeth P Louw


4 Sanlic International branches

General manager B Human

Branch manager Cape Town F De Kok

Branch manager Johannesburg B van Dyk

Branch manager Pretoria E Coetzee

Warehouse manager Johannesburg N McCabe

4 Voltex Lighting branches

General manager Johannesburg D Donald

4 Voltex Industrial Systems

Branch manager L Van der Schyff

BERZACK

4 Berzack Brothers

Chairman MC Berzack

Executive directors M BerzackR Berzack

Branch manager Durban M Berzack

Branch manager Cape Town E Huisamen

Branch managers Johannesburg R BerzackC Gordon

Branch manager Port Elizabeth T Allen

Branch manager Pretoria A Cloete

4 Bloch & Levitan

Director J Lourens

Branch manager Cape Town L Knee

Branch manager Durban R Schnoor

Branch manager Johannesburg J Lourens

EASTMAN STAPLES

Managing director C Werb

Area manager Glasgow W McAllister

Area manager Dublin P Mahon

Area manager Lodz S Stawiki

CATERING EQUIPMENT


Managing director M Crawford

Financial director R Lucas

Product development director R Barros

Director C Moodley

New asset management director

A Walker

National operations director R McMurray

National brands director M Neilson

Non executive C WattS TwalaS MahlalelaC Kretzmann

4 Vulcan Catering Equipment

Branch director Cape Town T van der Merwe

Branch director Durban C Bradfi eld

Branch manager East London and Port Elizabeth

B Bateman

Branch director Johannesburg M Neilson

STATIONERY


Director C Rostowsky

Director M Rubin

4 Waltons Stationery Company

National managing director J Farrell

Financial director F Reyneke

IT manager L Slotow

Procurement director P Cronje

Managing director Free State R Schoonees

Managing director Gauteng E Kleynhans

Financial director E Choonara

Sales director T Kane-Berman

Managing director KwaZulu-Natal M Frizelle

Sales director D Choirboli

Managing director Namibia J Van Tonder

Financial director K Nel

Managing director Port Elizabeth D Hugo

Financial director P Knight

Managing director Western Cape R Bowes

Sales director K Spence

Waltons Promotions

Managing director E Kleynhans

Distribution and logistics offi cer M Fraser

Hortors

Managing director E Bungay

SA Diaries

Managing director P Honeyman


4 Kolok

Managing director A Thompson

Financial director P Kleynhans

Marketing director M Ebrahim

Operations director E Cassim

National sales manager G Chappel

Brand manager L Stevens

Corporate channel manager L Nauschutz

Branch manager Botswana S Cassim

Branch manager Eastern Cape R Daniels

Branch manager Nelspruit D Pillay

Branch manager Western Cape S Galley

Branch manager Namibia M Roets

Branch manager KwaZulu-Natal L Klein

4 Contract Offi ce Products

Managing director H Magid

Financial director N George

Operations director B Eisenstein

Sales director H Elison

Procurement director R Gopal

OFFICE FURNITURE


Director M Rubin

Director C Rostowsky

Internal audit manager D Conradie

4 CN Business Furniture

National managing director R Bergh

Chief fi nancial offi cer W Du Plessis

Operations director J Nortjé

Managing director Free State E Coetzee

Managing director KwaZulu-Natal G Bolton

Managing director Western Cape H Meyer

Regional managing director Gauteng G Steyn

Regional director Pretoria D Nel

Regional director East London B Lindesay

Branch manager Nelspruit B Mdhluli

Branch manager Kimberley R Grindlay

Branch manager Pietermaritzburg D Naidoo

General manager Port Elizabeth R Pudney

Branch manager C Hornby

Managing director Namibia B Kotze

Lounge Lizard

Regional sales manager P Venter

CN Manufacturing

Managing director C Van Wyk

Financial manager N Flint

Budget Desks & Chairs

Managing director G Diamond

Branch manager L Potgieter

Offi ce Furniture Clearance House

Branch manager K Steyn

CN Café

Divisional manager S Mann

ACTA SA

Regional director E Coakelin

4 Dauphin Offi ce Seating

Managing director I Galloway

Financial manager H Noack

Sales director S Amri

Seating

Managing director S Gerber

Financial director L Snyman

Sales director T Dotzler

Production manager D Moody

Marketing director C Collins

Pago

General manager S Van Heerden

Ditulo

Managing director K Britz

Financial director L Snyman

Marketing director M Chauke

PACKAGING CLOSURES

4 Afcom GE Hudson

Managing director H Greenstein

Director B Kerkhoff

Financial director C Levin

Information systems W Pienaar

Fastening C Beeby

Packaging M Hilson

Strapping B Smith

Stretchfi lm R Trent

Labels W Coetzer

Human resources B Campbell

Accounting M Berthelot

Strapping F Fremouw

Collated nails and staples F OudmayerA Craukamp

Ti-Strap W Molautsi

Workshop D Stojic

Steel Strap S Pillay

4 Branch Distribution

Bloemfontein

Cape Town P SykesD McVean-Nicol

Durban K OliverD Poovan

East London K Guess

Port Elizabeth S Henley

Nelspruit A De Beer

Pretoria T Nel

Tzaneen C Alberts

4 Buff alo Executape

Managing director T Girnun

Financial P Urdang

Production T Isaacs

Sales A Nel

Operations S Sewpersad

Information systems R Vincent

4 Ramset

Managing director J East

Resellers/retail N Romain

Mining/construction V Thompson

Stores F Duff y



Bidpaper Plus

Chief executive N Birch

Financial director C Adendorff

Commercial director M Finger

Marketing manager D Macfarlane

Human resources manager P Breytenbach

Financial manager M Martens

Credit control manager M Kuhn

IT Manager Y Govender

IS Manager G Craye

Technical Project Manager Denys Gilfi llan


4 Lithotech

Managing director N Birch

Financial director C Adendorff

Key accounts director M Finger

Lithotech Afric Mail Cape

Managing director H Mentz

Financial director J Havenga

Lithotech Afric Mail Johannesburg

Operations director I Sinclair

Financial manager E Le Roux

Lithotech Afric Mail Durban

Operations director S Cleland

Financial director J Havenga

Lithotech Manufacturing Cape

Managing director G McWilliams

Financial director P Rossouw

Lithotech Manufacturing Pinetown

Managing director M Barrett

Financial director P Budhrum

Lithotech Manufacturing Spartan

Managing director V Rupping

Financial manager N Buthelezi

Lithotech Listing & Logistics

Managing director D Lewis

Financial manager E Le Roux

Blesston Printing

Managing director C McGinley

Sales director K Swan

Operations director B Bucknall

Globe Stationery Manufacturers

Operations director M Schouw

Financial manager E Ruiters

Silveray Manufacturing Mobeni

Managing director N Speres

Financial director P Haripersad

Kolok Africa


Financial director C Petit

Ozalid



Lithotech Corporate

Managing director J Neethling

Financial manager S Bezuidenhout

Export manager R Dowling

Special projects manager B Sachs

Lithotech Sales

Managing director Johannesburg L Avenant

Financial manager M Britz

Managing director Spartan V Rupping


Managing director Cape Town F Lundie

Financial director P Joubert

Managing director KwaZulu-Natal P Hayes

Financial manager R Singh

Managing director East London C Saunders

Managing director Port Elizabeth B Van der Berg

General manager Bloemfontein W Watson

General manager Pretoria G Arrow

Phakama Print

Managing director P Fick

Financial director Z Vawda


4 Wholesale Stationery Distribution

Silveray Statmark Company

Managing director H Servas

Financial director T Harman

National sales director J Millinger

Director J Wheatley

Branches Johannesburg G Reid

Cape Town G Baines

Durban H Yunus

Bloemfontein E Maree

Port Elizabeth J Kinnel

East London J Trefusis-Paynter


4 Electronic Transactions

E-mail Connection

Managing director H Rabinowitz

Operations director D Richard

4 Consulting Services and IT Solutions

Lithotech Solutions

Managing consultant O Immink

Managing director D Gilfi llan

PACKAGING & LABEL PRODUCTS

4 Lufi l Packaging

Managing director G Bowran

Financial director Davika Moodley

Branch manager C Anderson

Branch manager C Evans

4 Lithotech Labels

Managing director K Swan


Bid Auto

Managing director B Pretorius

Financial director E Roden

Human resources director C Khambula

Commercial director L Madikizela

McCARTHY MOTOR HOLDINGS

Chief executive B Pretorius



Financial manager N Wolno

Franchises

4 Alfa Romeo/Fiat

Managing director G Jooste

4 BMW/Mini

Managing director E Roden

4 General Motors

Managing director A Foxcroft

4 Land Rover/Volvo

Managing director T Herbert

4 Mercedes-Benz/Jeep/Chrysler/Smart/Mitsubishi

Managing director G Damp

4 Nissan/Nissan Diesel


4 Peugeot

Managing director M Ogram

4 Renault


4 Toyota/Lexus

Managing director T Sorour

4 Volkswagen/Audi/Seat

Managing director C Bailey

4 Burchmore’s Car Auctions

Managing director D Jacobson

4 McCarthy Value Centres

Managing director M White

4 McCarthy Value Serv

Managing director M White

IMPORT AND DISTRIBUTION

Executive director J Nash

4 McCarthy Vehicle Imports

Managing director B Soso

4 GAZ (SA)

General manager K Meintjes

4 McCarthy Heavy Equipment

Managing director D Chicken

4 Yamaha Distributors

Managing director I Pears

FINANCIAL SERVICES

Executive director J Nash

4 McCarthy Insurance Services

Managing director T Alison

4 McCarthy Finance

Managing director D Howell

4 McCarthy Fleet Services

Managing director B Corcorn

CAR AND VAN RENTAL

4 Budget Rent a Car

Managing director A Coward

4 Budget Van Rental


4 Chauff eur Drive


SUPPORT SERVICES

4 Corporate Services

Finance


Human Resources


Legal

Legal adviser P Smit

Procurement

Procurement manager R Bester

Internal Audit/Risk Control

Internal audit and risk manager D Pillay

ICT

Managing director M Strydom

Group Parts

Parts director P Tossel

Group Services

Service director S Collins

4 McCarthy Call-a-Car

General manager H Oosthuizen

4 Club McCarthy

General manager S Govender

4 Corporate Marketing

Commercial director L Madikizela

4 Eliance and ICT

Managing director M Strydom

4 Corporate Social Investment

Manager I Francis

4 Group Properties

General manager R Northend


Shareholders’ diary

Financial year end June 30

Annual general meeting November

Report and accounts

Interim report for the half year ending December 31 February

Preliminary announcement of annual results August

Annual report October

Distributions Declaration Payment

Interim distribution February April

Final distribution August September

Registered offi ceBidvest House18 Crescent DriveMelrose ArchMelroseJohannesburg, 2196South Africa

PO Box 87274HoughtonJohannesburg, 2041South Africa

Telephone +27 (11) 772 8700Facsimile +27 (11) 772 8970e-mail [email protected] or

[email protected]

Bidvest call line 0860 BIDVEST

Ethics lineTelephone 0800 50 60 90Facsimile 0800 00 77 88Freepost Tip-off s Anonymous KwaZulu-Natal 138, Umhlanga Rocks, 4320 South Africae-mail bidvest@tip-off s.com

Website and intranet www.bidvest.com

Bidvest publicationsAnnual report Financial statementsSustainability report Our businesses and productsBidvoiceEmployee reportTransformation and empowermentCorporate video – Young at heartMultimedia CD

The Bidvest Group LimitedIncorporated in the Republic of South AfricaRegistration number: 1946/021180/06ISIN: ZAE000050449Share code: BVT

Secretary Margaret David

Group auditors KPMG Inc

Other auditors Deloitte & TouchePricewaterhouseCoopers

Legal advisersEdward Nathan (Pty) LimitedAshurst Morris CrispMaitland & CoWerksmans Inc

BankersThe Standard Bank of South Africa LimitedStandard Bank London plcNedbank LimitedInvestec Bank LimitedHSBC Bank plcFirstRand Group LimitedCommonwealth Bank of Australia LimitedBarclays Bank LimitedASB Bank LimitedABSA Bank Limited

Share transfer secretariesLink Market Services South Africa (Pty) Limited11 Diagonal StreetJohannesburg, 2001South Africa

SponsorsInvestec Securities LimitedDeutsche Securities SA (Pty) Limited

Financial director, Group corporate fi nance and investor relationsDavid Cleasby

CommunicationsJack Hochfeld

Administration


Glossary

ABET adult basic education and trainingACSA Airports Company South Africa

ART antiretroviral treatment for those suff ering from or exposed to HIV/AidsAsgisa Accelerated and Shared Growth Initiative for South AfricaBBBEE broad-based black economic empowerment

BEE black economic empowermentCCTV closed-circuit television

CSI corporate social investmentCPI consumer price index

CPIX consumer price index excluding mortgage repaymentsDEAT Department of Environment and Tourism

DMTN domestic medium-term noteDSM demand-side managementDNA deoxyribonucleic acid

DTI South Africa’s Department of Trade and IndustryDWAF Department of Water Aff airs

EMS environmental management system Eskom South African national electricity supply company

ERP enterprise resource planningGDP gross domestic productGRI Global Reporting Initiative

HACCP hazard analysis critical control pointHDI historically disadvantaged individualIAS International Auditing Standards

IFRS International Financial Reporting StandardsIndustry charter(s) voluntary, wide commitments to black economic empowerment goals

ISO International Organisation for Standardisation quality management and quality assurance series of standards (9000) and environmental management series of standards (14001)

JSE JSE, South AfricaKZN KwaZulu-Natal

MAPP SETA media, advertising publishing, printing and packaging sector education and training authorityMIS management information system

MOD Ministry of Defence (British)MST Mathematics, science and technologyNCA National Credit Act (No. 34 of 2005)

NOSA National Occupational Safety AssociationNQF National Qualifi cation FrameworkOEM original equipment manufacturerOHS Occupational Health and Safety Act (No. 85 of 1993), South Africa

ORTA Oliver Tambo International AirportPPP public-private partnership

QMS quality management systemQSR quick-service restaurant

ROFE return on funds employedSABCOHA The South African Business Coalition on HIV/Aids

SABS South African Bureau of StandardsSACD South African Container DepotSARB South African Reserve Bank

SANTACO South African Taxi CouncilSETA sectoral education and training authorities

SHERQ Safety, health, environment, risk, qualitySIRA Securities Industry Regulatory AuthoritySTC secondary taxation on companies

the codes codes of good practice for broad-based black economic empowerment as published by the Department of Trade and Industry South Africa

TOPP training outside public practiceVCT voluntary counselling and testing (HIV/Aids-related)

This symbol indicates that further detailed information is available


Our company logos

BUSINESS SOLUTIONS AND GROUP PROCUREMENT

BULK CONNECTIONS

MANICA AFRICA

OFFICE AUTOMATION

Rennies Distribution Services

MARINE SERVICES

Rennies Ships Agency

Combine Ocean

Rennie Murray

BIDTRAVEL

SAFCOR PANALPINA

HOTEL AMENITIES AND ACCESSORIES

BANKING SERVICES

FOREIGN EXCHANGE SERVICES

BID CORPORATE SERVICES

BID PROPERTY HOLDINGS

NAMIBIAN FISHING

ONTIME AUTOMOTIVE

LAUNDRY SERVICES

BIDSERV INDUSTRIAL PRODUCTS

GREEN SERVICES

STEINER GROUP

AVIATION SERVICES

BIDRISK SOLUTIONS

GLOBAL PAYMENT TECHNOLOGIES

PRESTIGE CLEANING SERVICES

TMS GROUP INDUSTRIAL SERVICES

3663 FIRST FOR FOODSERVICE – UNITED KINGDOM

DELI XL – BELGIUM

DELI XL – NETHERLANDS

HORECA TRADE – UNITED ARAB EMIRATES

ISLAND VIEW STORAGE

BIDFREIGHT PORT OPERATIONS

RENNIES DISTRIBUTION SERVICES

SACD FREIGHT

SOUTH AFRICAN BULK TERMINALS

NAVAL

CorporateServices

CorporateServices


SPECIALITY

CATERPLUS

EASTMAN STAPLES


PACKAGING CLOSURES

BERZACK

STATIONERY


CATERING EQUIPMENT

OFFICE FURNITURE

Wholesale

Specialist


PACKAGING AND LABEL PRODUCTS

ANGLISS HONG KONG AND CHINA

ANGLISS SINGAPORE

BIDVEST NEW ZEALAND

BIDVEST AUSTRALIA

SUPPORT SERVICES

CAR AND VAN RENTAL

MCCARTHY MOTOR HOLDINGS

IMPORT AND DISTRIBUTION

FINANCIAL SERVICES

Bid Auto

BIDFOOD INGREDIENTS


211

4th Proof 27 Sep 07

4th Proof 27 Sep 07

The Bidvest Group LimitedAnnual report 2007

infi nite possibilities...www.bidvest.com

The B

idvest G

roup Lim

ited A

nn

ual report 2007

Documents

Bidvest AR 2007 · highly aesthetic in its form and execution. Pilobolus is unlike any other contemporary ... exchange services, oﬃ ce automation, supply chain integration, e-procurement