Bidvest, the international services, trading and distribution company, listed on the JSE in South Africa has delivered a solid performance, with the results demonstrating consistency in performance, strong cash flow and growth.
The Bidvest group oppoerates on 4 continents and has their maiden hygiene services entry in the AsiaPacific market and have doubled their Australian facilities management operations, in the past year of trading ending 30 June 2024.
Five out of their seven divisions reported profit growth with four delivering double-digit increases. The remaining two divisions, Commercial Products and Automotive, faced headwinds due to the high renewables base and a declining new vehicle market.
Key Highlights:
- 6.7% increase in revenue to R122.6 billion and an 8.5% rise in trading profit to R12.4 billion.
- The Group declared a final dividend of 447 cents per share, aligning with its dividend policy.
- The sale of Bidvest Bank and FinGlobal is underway and is anticipated to provide capital for further growth and expansion.
Financial health and dividend
Bidvest maintained sturdy financial metrics with a Return on Funds Employed (ROFE) of 37.3% and a net asset value per share climbing from R97.07 to R103.93. Basic earnings per share (EPS) rose by 6.6% to 1,873.8 cents, supported by solid operational performance.
Positive outlook amidst reforms
Looking ahead, Bidvest says it remains confident in its growth strategy and the potential for a more business-friendly environment in South Africa following successful national elections. Reforms in the electricity and logistics sectors are expected to unlock higher economic growth, while The performance of Eskom and Transnet’s recovery plan are pivotal in restoring business confidence and supporting future investments.
Despite possible headwinds in the first half of the coming year, including challenges in the export maize market, Bidvest anticipates benefiting from its strategic acquisitions and brand diversification. The Group says it is is poised to capitalize on global megatrends, drive operational excellence, and create social value while pursuing continued innovation and cost benefits for its customers.
Bidvest started FY2024 with a full Mergers and Acquisitions pipeline, mainly consisting of opportunities to scale and diversify existing businesses or geographic presence.
A year of M&A action
The group concluded an impressive eleven transactions that have been focused on their internationalisation in the niche areas of hygiene services and facilities management, as well as expanding their South African portfolio. They acquired Consolidated and RHS, as well as several bolt-on acquisitions – Robinsons Service, Pure Hygiene, Principal Hygiene, Synergy Waste, OSS Contracts, Roan Systems, Brandability, Green Home and Interloc. Post year end, on 3 July 2024, they also announced the proposed acquisition of Citron Hygiene, a provider of washroom hygiene products and services in the USA, Canada and the UK. The acquisition is subject to the UK Competition and Markets Authority approval.
The Group has also obtained approvals from the SA Competition Commission for the acquisition of Dekra, a vehicle testing station business, Wearcheck, a condition monitoring specialist and we closed the NexGen, which is a UK-based specialised facilities management company, transaction.
