Macquarie Investor Day 2012

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IMPERIAL Logistics expansion into Africa Macquarie First South Securities 3rd Annual Logistics Tour

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  • 1. OUR EXPANSION INTO AFRICAMacquarie First South Securities 3rd Annual Logistics Tour 28 November 2012 Cobus Rossouw
  • 2. IMPERIAL LOGISTICS REVENUE
  • 3. OUR AFRICAN FOOTPRINT
  • 4. RTT SERVICE PARTNERSHIPS
  • 5. 3 PILLARS TO OUR STRATEGY Invest heavily in developing corridors between neighbouring countries in Southern Africa so that product flows efficiently from neighbouring country to country Assist clients in benefiting from the mass consumerisation of Africa through our integrated value offering in the FMCG and Pharmaceutical space Explore supply chain partnerships and advisory opportunities with both existing and potential clients to identify potential solutions that can be offered to these clients in Africa
  • 6. OUTSOURCED SALES: CICWholly owned by Imperial Logistics, CIC Holdings operateswithin the FMCG Industry through agency agreements withboth local and international manufacturersThe Group currently operates in 9 African countries, including afootprint of 18 sites across the continent and > 10,000 staff Building brands and creating the demand Building IP Chasing FMCG growth Reporting and Point of Sale Consumers conversion Partners in profit COMPLIMENTED WITH Value proposition (stakeholders) Proactive route to market DEMAND CREATION Unique selling proposition (customers) Intelligence for bottom-of-the-pyramid SERVICES
  • 7. LESSONS LEARNT Forex surprises No 1-size fits all Due diligence complexities Related party arrangements Complex entrepreneurial structures Land ownership in African countries No pipeline of qualified quality people
  • 8. LESSONS LEARNT Over-reliance on the sellers as managers Centralisation of accounting and reporting Sellers made use of external consultant who was obstructive Over anxious for deals Start-up businesses very difficult, costly and time sensitive Thus not part of our model which is focussed on acquisitions
  • 9. CHALLENGES Taxation Corruption Governance Legislation complexities Infrastructure deficiencies Foreign exchange rate risk
  • 10. CHALLENGES Cultural fit and Africanisation Limited suitable opportunities Shareholder return expectations High price expectations on acquisitions Limited sypply of qualified human resources
  • 11. IMPERIAL LOGISTICS AFRICA 3 YEARS FORWARD Africanisation Country consolidation Zambia node established Pull dominant over push Unique selling proposition Integrated value proposition Customer one answer in Africa Angola
  • 12. IMPERIAL LOGISTICS AFRICA 3 YEARS FORWARD 50% less reliance on South Africa Competitive Africa fleet of trucks Africa manufacturers preferred partners Asset light service offering 4PL (Sub Base) Partner with global, local and SA retailers & manufacturers Create China/Africa partnership to assist with Angola Imperial Logistics Confidential
  • 13. QUESTIONS?
  • 14. IMPERIAL GROUP IN PERSPECTIVEThe IMPERIAL Group is founded on five strategic pillars: IMPERIAL was established in 1975 and is a diversified industrial services and retail group. We operate in South Africa, Africa and Europe with an extensive global reach. IMPERIAL, listed on the JSE, operates a decentralised management structure that actively encourages entrepreneurship, innovation and encourages industry best practice.
  • 15. IMPERIAL GROUP IN PERSPECTIVE
  • 16. IMPERIAL LOGISTICS AFRICA
  • 17. OUR POSITIONING We improve our clients competitiveness through customising our experience in outsourced supply chain and logisticsCombining consistent fundamentals and tangible value add, we supply logistics and supply chain management from a single source
  • 18. CHANGING ROLE OF THELOGISTICS SERVICE PROVIDER
  • 19. OUR SERVICE OFFERINGS
  • 20. ADVISORY SERVICES Market assessment Business plan development Customer profitability assessment (Revenue Cost 2 process + Cost 2 serve) Route to market strategy Intermodal strategy (Port, Rail, Road) Network configuration (Local, International) Supply Chain Capability development (Design & Manage) SOP process & structure WHs process innovation Transport fleet configuration Inventory planning & modelling Procurement strategy Technology enablement / Visibility Modelling
  • 21. INFORMATION TECHNOLOGY SOLUTIONS
  • 22. INFORMATION TECHNOLOGY SOLUTIONS
  • 23. PEOPLE ALIGNMENT
  • 24. ENGINEERING LOGISTICS
  • 25. LOGISTICS MANAGEMENT
  • 26. COMMITTMENT TO B-BBEE B-BBEE is a strategic imperative IMPERIAL Logistics is classified as a Level 3 contributor with a significant Value Add Supplier Status This translates to a 137.5% Procurement Spend Recognition from IMPERIAL Logistics We will continue to pursue and promote all facets of empowerment in our businesses
  • 27. COMMITTMENT TO SUSTAINABLE TRANSPORT Improving our environmental footprint through the adoption of these principles.
  • 28. COMMITTMENT TO CSI
  • 29. COMMITTMENT TO SKILLS DEVELOPMENTDuring 2011 we spent over R55m on skills development - 75% black employeesand 25% black femalesIMPERIAL Learning Centre works with SETAs, internal experts and accreditedproviders and has string relationships with tertiary bodies and academicinstitutionsOur Fast Forward programme takes a practical approach to addressing the skillsgap - from facilitating workplace entry and tertiary education support toresearchIn 2012, the IMPERIAL Programme for Supply Chain and Logistics at GIBS waslaunchedThe programme will elevate the visibility of supply chain management andposition supply chain management as a career of choice for professionals
  • 30. INDUSTRY ASSOCIATIONS MEMBERSHIPS
  • 31. COMMITTMENT TO SAFER ROADS Each of our operating companies is responsible for compliance with the National Road Traffic Act Registration of vehicle operator Fitness of vehicles (registration, licensing and roadworthy certificates) Fitness of drivers (drivers licenses and professional driver permits) Driver training (e.g. duty of driver in event of accident, accident reports) Road Transport Management System
  • 32. COMMITTMENT TO SAFER ROADS 1 in every 3 car rental transactions is made through IMPERIAL 1 in every 4 cars sold in SA is through IMPERIAL IMPERIALs southern Africa transport fleet travelled 460 million kms last year With so many of our vehicles on theroad, IMPERIAL embarked on an excitingcampaign to make our roads safer - one pledge at a time.