Post on 31-Oct-2021
transcript
Our Business
Southern African Distributor of:
– Terex articulated dump trucks with payload capacities of 25, 30 and 40 tonnes
– Terex rigid dump trucks with payload capacities of 45, 60
and 100 tonnes
– Sleipner excavator transport system
– Provision of aftermarket technical services and on-site
labour and parts sales
2
Our Market
• Open cast mines and mining contractors
• Quarrying and materials handling
• Civils and earthworks
3
Operational Developments
• Expiry of current OEM agreements - Terex: Dec-2013 (commenced negotiations)
- Sleipner: Sep-2015
• Sale of Eqstra Mining Services (Bucyrus) business unit
• Discontinued New Holland Construction franchise end August 2012
- Closed Durban, Cape Town, Port Elizabeth and Rustenburg branches
4
Organizational Structure
Department Staff Compliment
Fin & Admin 14
HR 2
New Equip Sales 6
Parts 23
Africa 1
Plant Leasing 3
Tech & Service 32
Used Equipment 1
Mine Site Ops 74
Grand Total 156
5
Financial Summary
Rm 2012 2011* % ch
Revenue-generating assets 158 90 75.6%
Inventories 269 544 (50.6%)
Other assets 269 249 8.0%
Operating assets 696 883 (21.2%)
Revenue 452 507 (10.8%)
EBITDA 11 30 (63.3%)
Operating profit 5 33 (84.8%)
Net finance income (costs) 3 (5)
Profit before taxation 1 24 (95.8%)
PBT margin 0.0% 4.7%
EBITDA to net finance costs 3.7x 6.0x
9
Way Ahead
• Focus on aftermarket services as sustainable
income stream
− Improve absorption
− Earn customer respect and loyalty
− Build sound base for repeat business
• Establishment of on-site repair and
maintenance infrastructure
− Provide key technical skills (labour sales)
− Improved parts availability
10
Way Ahead (cont.)
• Diversify into new commodity segments − Current high exposure in coal
− Target iron ore, diamonds, platinum
• Expand customer base
• Expand operations into rest of Africa
− Zambia
− Mozambique
− Zimbabwe
11
Way Ahead (cont.)
• Continued growth of equipment leasing business
through Eqstra Plant Leasing (EPL)
• Multi-brand equipment leasing with value added
products and services
• Commercial risks managed through
– Short lease periods
– Low residual values
12
Key customer support structure
CustomerCustomer CommodityCommodity EquipmentEquipment Staff Staff
Sandton Plant Hire Coal 21 X TR100 12
10 X TR60
Moolmans Mining Nickel 17 X TR100 8
MCC Nickel 21 X TR100 11
Anglo Platinum Platinum 11 X TA30 8
1 X TR100
25 X Mixed
Benicon Earthworks Platinum 10 X TR100 9
Lonfin Manganese 10 X TR60 4
Group 5 Gold 10 X TA300 4
14
Key strategies Sustainable profitability Increased number of on-site customer support structures
Total overhead absorbtion through baseline profits
Widen new and used equipment customer sales base
Drive overheads down and improve working capital management
Increase annuity income through Eqstra Plant Lease
Inventory management Run-out New Holland equipment and parts stockholding
Scientific parts re-ordering process (JIT)
Rigid truck orders only on back-to-back customer orders
Counter cyclical business
model Increase market coverage to include wider commodity markets
Widen geographical spread into rest of Africa countries
Identify additional value added products and services
Establish used equipment re-marketing channel
16
Outlook
• FY2013 year will remain challenging
• Cautious optimism due to uncertainty in market
• New equipment sales slow in first half
• Improved overhead absorption through growth in
labour and parts sales
• Improved knowledge and skills base through
increased training and development
17