Motus Holdings Limited (MTH) Earnings Call Transcript & Summary

Good morning, everyone. Thanks for making the time to be here. I know it's not an easy week because there's quite a few companies producing results. And then obviously, we've got -- we went through our budget speed, so that also kept us busy. So I know you guys are running off your feet at the moment, but thanks for making the time. Thanks to our Audit Committee Chairman sitting in front here, and we've got our audit partner, Tommy as well somewhere. They're just seeing what I said at the Audit Committee and the Board. I'm consistent to what I'm telling you. So don't worry about consistency. You've got 2 cops here. They'll make sure that Ockert and I are consistent and saying the right things at Audit Committee and the Board. I think we're all aware that South Africa is going through a very difficult period. Africa is going through a difficult period. So the economies in South Africa and don't underestimate the impact of the economies offshore, whether it's in the states or whether it's in Europe or whether it's in China or Australia, the economies are going through a tough time, more so in South Africa than anywhere else. And you saw a relatively stable budget speech but then our currency tanks after that. And all of a sudden, if you look at your currency Thursday, Friday, Monday, no change. Those are the worrying signs. So when you look at our results and you look at the corporates in South Africa, I look at them and saying that I think the teams are doing a great job in a very difficult circumstance that we find ourselves in because I mean if you go through the detail like us when we sit in the way, and you look at the pain people are going through in terms of their jobs, their social lives, they're going home, financial issues. It's not easy to motivate people in this environment. But it's not us as a company. It's the environment that people are working in. It's a very tough environment. I mean driving home is not easy. When you go to the Pick n Pays of the world and the Woolies of the world, and you look at the trolleys, what they're costing us, you look at the kids education, everything is creating stress in our lives. But despite that, I think we as a nation are doing a good job. So -- and the reason I'm telling you this is that I think you see a lot of results. You're going through a lot of results presentations. And everyone, we got accountant, we can explain anything. But I think the bigger issue for me is the environment we're operating, it's not easy. So I think you guys need to understand that our people and the South Africans are doing the best under the current circumstances. And if corporates like ours are producing the results the way they are, that means the old saying of a boor maca plant is working in South Africa. That's what we're doing. We make our plan every day to make things happen. So all I'm saying is that you've got to just put our numbers, our corporates into context, that despite so many broken things around us, this score is working and of course, the corporate world. And I -- all I want to say to you that these things are working, and you've got to look at it in that context. So it just gives you some context in our numbers as well. We've got quite a bit of an agenda this morning. So I think the bulk of it is Ockert as well. So I'll leave you with all the financial stuff. Although he's got one item, number 13, but we've got plenty of slides. So let's see what happens. So if you look at the first point I'm making to, yes, resilient trading performing in a very challenging environment. So that's the point I'm making to you that the guys are making plans. They're working hard. They're juggling a lot of things to get here. And for us, our turnover going up 11% yet. Yes, a lot of it is inflationary because of car prices going up, things like that. But I think 7% will be inflationary. The balance will be acquisitive as well. So there's some real good opportunity into the future, which is not all in -- if 11% was inflation, then we're riding on the inflation back. But I think 6% or 7% is inflation and the balance is from the business. The EBITDA of being up 13% at ZAR 4.2 billion, a great number for 6 months. So what we're saying to you is that, despite all the difficulties, those groups produced great results, operating profit at ZAR 2.6 billion, flat, flat in a very difficult environment and then obviously, the cash flow generation. I mean, if you look at ZAR 2.8 billion, for 6 months, not a bad number. So if we can just grow that number and repay some debt, we'll get this business into a very stable situation that we wanted to be in. We continue with the bolt-on acquisitions. And like I said to you previously, we'll do bolt-ons where they fit a region or they fit in area. Now you can see in the U.K., we've just added on DAF dealerships that are doing well for us. They're the best performing dealer. Just so that you understand DAF, DAF is a third market share in the U.K. in the truck business, and we have 1/3 of their share. So that's whatever you add in DAF it just makes money because of the market share. And we're very fortunate. We picked up 4 DAF dealerships. And then Australia, the strategy is we're not going into Sydney or Melbourne, where you're paying fancy rentals, fancy salaries. We're in the provincial towns. So if you look at Ballarat, provincial town, Traralgon and now we're in Wagga Wagga. You can see in Wagga Wagga, it sounds -- I'm sure a lot of you haven't even heard where it is, but I can give you comfort that Ockert's jumped into a place from -- a flight from here to Sydney and then took a small 6-seater and got to Wagga Wagga, went to see it. They showed him river that produces waves. I don't know how that happens, but he saw that as well. So he's been there. He knows what -- when he talks about Wagga Wagga, he knows that. So that was nice. Again, if you look at it, we've got 9 brands in 2 sites. So again, multi-franchising in a regional area where your margins are better. In the city centers, your margins are low in the provincial areas, your margins are better. This is something we were very excited about 2 years ago, the aftermarket parts business 2.5 years ago, when we first did FAI, we dipped our foot into it, understood it, and then after that, we did the MPD deal. So I'll talk a bit more about these numbers. Relax, don't worry about those numbers. I'll give you a bit more detail. There's another slide on that. And you can see our accountants can also mess your numbers up. If you look at the operating margin, 10% excluding amortization and 12.2% the way businessmen will look at it. That's the margin I look at. But remember, the amortization is a journal entry. It's not a cash entry. So look at the 12.2% and don't panic about 10%. I've got to satisfy Tom and Saleh and Uvasha about the accounting standards. But the entrepreneur looks at the 12.2% because that's what the cash we generate in that operating margin. We're fortunate in a sense that despite the difficult market we're going through, we haven't forgotten where we are, where we should be in terms of ESG. So we're still focusing a lot on the climate issues, the transformation issues. And you can see our black representation at 78%. I think we've done a great thing coming from unbundling to where we are at 78%. And the gender, we have 32% female and the target in the next 2 years is to get the to 40%. So we've got a plan and the strategy, and my ExCo members know that, and they're helping us to get there over the next 2, 2.5 years. And to our transformation team, which Berenice Heads up, she's here in the audience, there she's sitting there. And we've got to Level 3. We've been battling with the Level 5, 4 and now we're at Level 3. So I think we've made some great strides in doing the right thing. And with ESG, you're flying this plane while you're repairing this engine in the air, that's what we do. You're trying to make all these changes in your businesses together with ESG, together with -- while this thing is flying and you've got to make money at the same time. So it's not an easy task that you're going to convince the CEOs, please make me money and sell cars, but please look after your ESG as well. So it's not easy, but the guys do a great job in doing that. And we continued with CSI, which is all the projects we will talk about. And then we rewarded the shareholders with giving you ROIC plus WACC, so we haven't forgotten that. We'll still continue paying a dividend, so you don't have to panic. And the net asset value at $100 a share, I think everyone understands that it's a great achievement that we're not destroying shareholder value. And the advantage you have with a group like Motus is the net asset value is not airy-fairy stuff. Cars, you can touch them. Parts, you can touch. Properties, you can touch. So 95% of our assets you can feel and touch. There's a bit of goodwill, obviously, with acquisitions, but this net asset value is for real. I'm not too concerned with the goodwill because if you take our property portfolio and you use that at market value, it's fine, excess of the book value. So that will leave a net each other out and give you some surplus. So that's why we're very convinced that this $100 net asset value per share is a real value. It's not airy-fairy intangibles and goodwill that you think if tomorrow this business goes, we have nothing, we can count our money. Okay. To recap, what would you say 6 months ago? And where are we? Guys, when we give you our prospects and guidance and we take risks as well, we're not bulletproof. So we make a statement with the best information available at the point in time. Touchwood, it's worked for us. So we told you deliver positive revenue growth. You can see we're delivering 11% revenue growth. Delivered stable profits, was stable minus or plus we're giving you the 1%. So that's the best we can do. Maintain a solid position -- financial position in cash flows. That's bringing our stock down by ZAR 2.6 billion. We wanted a bit more, and I'll explain why or -- I think Ockert explains that why we didn't achieve the target we wanted to, but ZAR 2.6 billion is still a great achievement. And you can see that fell straight into the cash pocket. So that's the ZAR 2.8 billion we generated. Okay. So these are the 2 acquisitions. And you can see that DAF dealership. I mean, we paid ZAR 263 million. For the clever accountants amongst us, ZAR 54 million, that's a 5 multiple. So we haven't overpaid in an environment where we know interest rates will drop, and the returns will just improve as we go along because the U.K. and Europe and the sales will drop interest before us, and generally, that will be a big kicker for us. So you can see we haven't overpaid but to generate this kind of money, ZAR 54 million and ZAR 263 million, I'll take that any day. And then you can see in Australia, in a province or in the town that you may not have heard of, we're going to get ZAR 60 million from that business, ZAR 64 million from ZAR 290 million. Again, for the clever accountants, it's not more than a 5 multiple of earnings. So it's -- and I know you -- I should be looking at the multiple after tax, and the 5% can become a 7%. That's what it will be. So we're not overpaying for these businesses as we go along. And the thing is they're giving us a good footprint where we are. They're improving our economies of scale. Okay. So when we unbundled the group, aftermarket parts was the smallest part of our business, which was in South Africa, buying in South Africa, buying a product in China and selling. That was our strategy. But we knew at that time that, that's not where we want to be. That's a starting point. And there's 3 things we've done in the interim. We grew the Chinese distribution center, so that was the first thing we did. Then we found the FAI opportunity, started that, learned from it, understood how parts work, how the distribution works and then we went for the bigger brother, MPD. Put into context, FAI is what, 20% or 18% of what MPD is. That's why I call it the bigger brother because they're not comparable in size, but that gave us the footprint we were looking for. So we look at these numbers and you look at your revenue at ZAR 3.1 billion, but look at the EBITDA of the 2 aftermarkets, ZAR 490 million simple accounting, if you double that, that's ZAR 1 billion EBITDA. From a 0 base in 2018 when we unbundle 2019, 0. 2024, you could be counting ZAR 1 billion worth of EBITDA and the operating profit of ZAR 307 million. Now the reason I'm talking about EBITDA, remember the depreciation is not a cash entry again. That's amount of profits this business will make about ZAR 1 billion. Operating margin at 10%, I criticize accountants already, and I look at the 12.2%. So you can see what margins we're making. This business is very good at free cash flow generation because remember, you spin that balance sheet 3, 4 times a year, you like a Pick n Pay or a ShopRite, you buy and sell and you spin. Unlike cars where you're going to carry 45 -- 60 days of new cars, 45 days and takes time to sell, this stock spins. The better you spin, the better the cash you're generating. So that's where we like this. And this ROIC is not 1% plus WACC, it's a very reasonable number. Okay. That's history. That's the accountants talking. Let's go forward. What do we want to achieve with this business? How are we going to take this ZAR 1 billion EBITDA and make it ZAR 1.3 billion, ZAR 1.4 billion in the next 2 to 3 years? So Ockert & I has 2 ex-accountants, that's not our specialty. We're looking at growing our business. So these are the strategies we're focusing on. So you can see with Malcolm and Neil, both of them are here, I saw them earlier. Okay. There is Malcolm and there's Neil. So this is their baby. They sleep that business, they eat that business and they stay awake and they don't come with bad news to us because if they want to give me bad news, put your resignation first before you give me bad news. So they know their priorities. So this is their priorities. I don't look smart in saying it's only my priority. Those 2 guys are in the day to day of this priority. What's the priority? Buying groups, they've consolidated. They've made this a global business. So if you look at the procurement people, the supply chain management people, the person that sits in our business in China, they all sit in the same board meetings and the ex-cos that we sit in their meetings. So that's why we're combining -- we want to get the operational efficiencies from a global business, not from South Africa or China, the U.K. Malcolm and Neil have surrounded themselves with a global group now. Not all of them sit in South Africa. One guy in China, 3 people in the U.K. and Malcolm is based and Neil will move in April to the U.K. as well. So you can see we're treating it like a global business. I talked about procurement. We have one procurement, one supply chain management. And then what's exciting as well is the product because we can source more from China. And yes, we've got very good people in China that look at quality standards, what's acceptable, not acceptable. We even will box the product there. So we will buy the boxing and we've looked at the packaging in that, and that's our FAI PRO product. That's our own product. We're not building somebody else's brand, like we did historically, like we built a lot of money for Bosch and Schaeffler and Ferodo and that will start by building our own brands, and that is the beginning, the FAI PRO. But remember, FAI PRO is one name, but it'll have a lot of products underneath that and that's what we're trying to develop. But you only do these things via economies of scale. Now that we've got economies of scale, we're going to use China more effectively, but we can pump more stuff into the U.K. And we'll pump more goods into South Africa on that as well. And I'll talk a bit about Europe in a sec. In the U.K., for example, if you look at where we are in Latin Buzau, that's where we are, the warehouses set at a point in time, but we're moving on. And that's why as the lease expires, we're moving to Milton Keynes. So we're moving into a different area, more accessible, design the warehouse differently become more accessible to the MPD stores and to other customers as well. So that's the focus now. And Malcolm and Neil have pushed that quite hard, Ockert now a bit reluctant but they've had a very good we meet 2 persons. And so we actually just approved the Milton Keynes project now after a lot of debate. And then with our warehouse in Poland, we want to expand that for -- not for Poland for Europe. So we're going to be moving goods from China no longer to the U.K. and then to Europe. We're going to move it from China into Poland. We've got the warehouse going. You don't realize how long it takes to get that numbers, open bank account details. This business should have been operational in December, but it will only operation in March because of all the formalities. The goods are already moving, but the invoicing will start taking place. So we're very excited about making this a global business through China, Poland warehouse, the U.K., moving its game. And then on top of it, you create your own products through that FAI PRO. We've opened additional 2 MPD stores. And obviously, the sourcing in China then helps your margins in China as well. So you don't give them all the margin to the U.K. and they give it away to the customers. You keep some in China and then you make sure that your U.K. business is profitable. And then I talked about Poland as well. So you can see this business has got a lot of legs. Unfortunately, I can't tell you all this money is in the next 6 months. Your supply chains are long. They're 9 months sometimes. In between the 9, you'll get a Chinese New Year. So that disrupt things as well. So that's why these supply chains are longer. But if you're looking forward, this is a business with a lot of potential. There's no more goodwill to be paid. We've paid the goodwill. There's no more intangible write-offs. So we've done that. Now we're just sweating this asset. And that's the job that Malcolm and Neil and the team got to make sure that this is now firing on 6 cylinders in the next 2 years. We'll see the benefits in '25 already. But in 2026, this is the year for aftermarket parts. It will just deliver a lot more income than it's got today. This is just our action plans on the inventory. And I think Ockert is going to talk a bit about inventory as well. So I'm not going to go through all the things, but I'm not going to go through the slide in a lot of detail, but we're working with the OEMs locally. We're working with the OEMs in Korea and in France to help us with rebates, money on the bonnet, marketing assistance. A lot of vehicles today, you hear, there's 30,000 on this bonnet and 40,000 on that bonnet. It's not all our money. A lot of it will come from the OEM. We put some money and we make our deals attractive that way. So we have to because that's the market. So -- but we're not doing it on our own. The South Africans have done a great job in bringing the stock down. There were 2 disappointments, which we can live with, but we can explain as well and understand. One is Australia. What happened in Australia is what happened to South Africa 12 months ago. December 2023, we picked up a lot of stock because all the backlog came. In Australia, it only happened in January 2024. So all their stock arrived. So we overstocked by about ZAR 1 billion or ZAR 800 million. But we've got orders for that stuff. So come April, they'll start offloading those goods because they've had the orders, they've had some backlogs, but now they're delivering. So by end of April, May, they'll get that back to normal. So that doesn't worry us again. Those cards are bread and butter cars. They Fords, they VWs, they Mazda's, Isuzu's, they're bread and butter vehicles. So I'm not sitting with 2,500 Ss or GLE, AMGs that I can't sell, that's not our bread and butter. So even in Australia, our bread and butter is the cars that sell. And by end of April, I think we should get that back to normal. The other issue is the U.K. In the U.K., you take an order for a truck, but you may only deliver this truck in 6 or 9 months' time. And the reason for that is you've got to build the back section of the truck. So if the waste dumping truck, that could take you 7 months to build the back section. If it's a refrigerator truck, it could take you 9 months. If it's a bakery van, the Albany Bakery type of vehicles you see, that's quick. That's 3 months. Now that is not in our hands, and it's not in the OEMs and it's body builders that do this. In COVID, a lot of them went out of business. With Brexit, a lot of the skills went back to Poland. So the technical skills disappeared. As a result, not too many new businesses came about to accommodate the need of the growth in the economy. Now we're waiting 6, 8, 9 months to deliver these things. Since June last year, we're recovering the bulk of the interest. That means we're charging the customer interest. We know that this truck will take 6 months, and we said its okay, but we're collecting interest as well, but it's not helping the stock. So we're still a bit over stocked in that area, but those trucks have names, they've got orders next to it, they will go. It's just a question of time, and that's what we're battling with. I mean it's not something that we're just going to fix up tomorrow because as you fix it up, you're putting another order and the orders are slowing down because I think the backlog is clearing now. But this problem is there for a while. And until we don't get more body builders, we're going to battle with this position in the U.K. But guys, it's a profitable business. You can afford to have those customers and they take longer to pay or deliver. I was saying the Board yesterday, if there's any slide that excites me is this slide. Because when I look back when Ockert and I were doing the unbundling and we came to blow the horns here and things like that, these were dreams that we had and targets we -- the 2 of us had. And what were these targets? We wanted to be 50% of our profits come from new car sales and 50% from non-car sales. That means what's that aftermarket parts, mobility solutions, car rental, things like that, not related to the sale of a car. We set this target. The other target we wanted was our EBITDA had to be 65% South African, 35% local. At unbundling, we must have been what, 8% or 10%. We have 35%. And the strong cash flow I've talked about, but Ockert's going to give you a lot more details. So then we move forward and saying what have we actually achieved? Did we dream properly or did our dream disappear and the dream became a reality? And there you can see in the last column that we're going to be 51% of our business that's going to be from -- not from a new car sale and the 49% generated from vehicle sales. So that's how we've given this business stability is by adjusting that. Then you look at the next slide, and then you look at our offshore income to our onshore income, again from 8% and 10%, we're at 34% (sic) [ 35% ] from offshore and 65% from local. Now is that the end of the journey? No, we didn't wake up and the dream disappeared. The dream is still there. And in the next 2, 2.5 years, if we can make this a 50-50 business in this slide, that's the next goal. So obviously, the first slide then becomes academic, because it will all be in the non-car sales. So that becomes -- now the focus is for the next 24 months, we'll be on this slide to make sure that we get to that 50-50. It may be 24, it may be 30 months, but the vision is there. And part of this vision, a big part of this vision will be that aftermarket parts business. I've talked a lot about passionately. And obviously, our U.K. business is doing quite nicely as well from commercials and things like that. The nice thing about bringing the commercial business, you don't only deal with the man in the street. You deal with the Tesco's and the Sainsbury's of the world, and you're dealing with the Fraikin's, which do truck rentals, you deal with corporate. So when a truck price goes up by GBP 100 or GBP 50 or whatever, these people need to run a business and they're repartners in their business. And that's why that commercials business is a very valuable business that we have. Okay. So that's strategy. That's what we're going to go to. We always come home, isn't it when we land in ORT, that's where we belong. So this is where we belong. So you look at the car market is very static. I mean I can read the numbers. You're just as good a reading. You can see very straight line here. And even if you look at our calendar '24 and financial '24, the numbers are not growing. Now is it because we're doing a bad job or the OEMs are doing a bad job? No. There's too many external factors impacting this high interest rates, high unemployment, power outages are not helping confidence in the economy. Transnet doesn't help. So you're sitting in a whirlwind and you sitting in the center here. And you're spinning in this washing machine and you're still going to deliver what you need to deliver. So unfortunately, for South Africa, for the short term, I think it's going to be tough. In an election you make it worse. Everyone promises, they're busy promising. So no one is working. So this year is going to be -- he was right this year often move on. Let's go to '25 now. And I think that's where we are. And I can tell you about people are buying down from the premium brands. So I can tell you all that, but that's the reality. We're just very privileged as Motus that we play in the right game. So we're not playing soccer in the cricket pitch. We're playing in the game where the customers are. And why do I say that? Look at the big businesses in Motus, Hyundai, Kia, Renault. They play exactly in that band below -- we've got cars over 1 million, but the band that we play in is the 250 million to 750 million. That's the band that we play in. And these importers play in that band. So that's what keeps us relevant in this market to make sure that we don't become obsolete or our sell-by date expires. We're playing the right game in the right market in the motor business. So we're very fortunate that we're backing the horses. The other thing that a group like ours is doing well, is our investment in like motus.cars, Motus Select. Now you can see what I say there, motus.cars is the biggest online vehicle buying platform. Now people will argue there are bigger platforms than Motus. Motus owns every car that you see on that picture. Google motus.cars, any car you see there's our car. We sell it with confidence. We know we've checked the car for you. We can tell you that if we have a problem, we are around. Why are we around? We've got 256 new dealerships. We've got 70 or 75 preowned dealerships. Am I going anywhere? I'm not going anywhere. You have a problem, you come back to us and we will help you. Yes, you get unreasonable customers, but 90% are very reasonable customers, and we err on the side of the customer. So that's why we were fortunate in that way. We're playing the right game. We're not getting left. If all we had is Motus, the premium brands in South Africa, which is if we had Mercedes, BMW and Audi, that's all we had. I don't think so, I'll be fired a long time ago because I couldn't be delivering the results I needed to -- but because we're playing in the right game, I think we're very fortunate that we can be very competitive, good quality product, and we've got an infrastructure that's delivering good client service with very good people. Okay. There is pain guys. We didn't come out of this thing unscathed. You can see the pain that from 22% market share to 19.4%. All I want to caution you is that, that 22% was artificially high because what happened in the first 6 months of that year, a lot of people were still suffering with computer chips, not getting the right stock, but we had the stock. So we made hay while there's sunshines here. So that 22% under normal circumstances should be about 20.5%. So the 19.4%, yes, is a decline, but it's not as bad as you think it is. The other thing is that what's happening with our OEMs maybe in Hyundai and Kia, a bit in Renault, and I'll explain that in a sec, is that the entry-level vehicle, the car below 220,000 or below 230,000 our OEMs can't make cars, cheaper cars at that level. So they're all moving up. As a result, we're playing more actively in the 300,000, 400,000, 500,000 but this entry level, we've lost some cars there. Our OEMs are not delivering us the cars. They may deliver again, but at the moment, be short. Renault is fortunate. They're delivering a car in that category, which is below 230,000. So they play in that market. There's only 5 cars in that market; Renault, 1 Toyota and 3 Suzuki's that are playing in that market. So you can see our South Africa's move. Did we think that no, but it's there. Above the 250,000, 280,000 mark, we play well in that game, and that's an area where that will be still playing. So the decline, yes, it's harsh. But because of what I'm describing, it's -- the base was slightly high, a; b, there's some entry levels missing. And then Kia's missing some models. They didn't deliver enough the Sportage diesel, for example, the Pegas', that kind of thing. Hopefully, those cars will come. And the other thing is with Hyundai, Renault, and Kia, there's a lot of new models coming in the next 2 years as well. So they're very relevant, and it will keep our share of the game. That's what it's all about. I'm very worried in the last 3 days that if this is the norm of the currency, this is going to be a major problem. Now Ockert's going to talk about the forward cover. The forward cover we've got until the end of July or August. That's not the worry. This year has spoken for. It's what can we deliver in June 2025. I know it's a long time away, but if the currency remains at these levels, it becomes an issue. So we've got to go back to the OEM and renegotiate. It's early days. I mean, we've only had 3 days of crazy currency. We've still got currency to the end of August, so there's no rush to rush up now. But I'm just saying, South Africa is becoming vulnerable. And don't think of it in cars, think of your Microsoft offices licenses that we pay for. They don't happen in rands, they happen in dollars. All the things we import in everything we do is becoming that more expensive. And it's not only cars, it's everything we touch is becoming expensive, and that's not we, the economy. Okay. So fortunately, we don't have the eggs in all one basket, and you can see how the baskets are playing out differently. So what's interesting, you can see the 2 economies, U.K. and Australia, you can see how they pushed up their volume in new 19% and 31%. And that's the thing I was talking about Australia. They slightly only come lately with their stock, but they're getting -- but they're moving it. You can see it. South Africa is taking a bit of a hiding. And the markets dropped in cars by about 5%, 6%. We slightly more, and that's why I just explained the whole thing about Kia and Hyundai and what we did there. The pre-owned, we're holding our own and the totals then pan out what they need to be. But you can see, fortunately for us in South Africa, we're focusing bigtime on the preowned, and you can see we flat at that level. Australia is doing quite nicely because we're getting a lot of trade-ins to put the cars into -- people into new people. And U.K., what happened there is that the new car stocks that are arriving. So the new cars stocks are a bit of a hiding, and that's why we sold it in new, we didn't sell it in pre-owned. So what you lose on the swings you pick up on the roundabouts. Okay. So I talked a lot about the aftermarket part strategy. That's one protection. What's the other protection that Motus has that balances our books and I'm not going to go through again, there's some repeats here because if you look at the import and the retailer, these repeats, what are the repeats? Firstly, both those businesses sell parts to an existing car park. That means even if I don't sell a car today, you bring your car for a service, you bought last year, the previous year, 5 years ago. So the parts market is there, then obviously, our workshops. So you guys bring your cars in, we service them, and that's how the workshop in both those channels. We've got the parts and the workshop. The importers have the added advantage. They're not only supplying parts to their dealerships. They're supplying the parts to the independents in the ballads of the world and in the [indiscernible] of the world, they supplying parts there because their franchisees. The equivalents of the one piece, so they have to buy the burgers from us. So that's where we have to supply parts to them. So that's quite a nice model, and we've got about 600,000 cars in that car park. So again, gives you a protection mechanism that you don't just rely on the new car, but you protect it with the parts and the workshops. The other thing that -- guys, before I started, which was a great thing, and we're benefiting from is the footprint of our dealerships. On the new car side, we own about 80% of our footprint. On the used cars, we signed leases because we -- areas come and go and we get out of it. On the new car side, because we own it, we allow the multi-franchising. We can take Kia from there put it there. We take Hyundai, we take Renault, we take Mitsubishi. We allow that multi-franchising model to sweat our assets. And I've talked about this before, was Mainland, 1 address with 7 dealerships. We're missing one, but hopefully, we'll fill that space up. So we've got 7 dealerships. We've done that in George now. For those of you that enjoy going to George, you'll see next to the mall, you'll see a BMW, Hyundai, Kia, Renault and I think there's a Mitsubishi now. So again, 1 address, and in front, you'll get the Ford, Land Rover, Jag behind you see us 1 address, and that's what we've got. So we're sweating our assets as best as we can. You go to [indiscernible]. You'll see a lot of multi-front. You see -- when you enter [indiscernible], on your right-hand side, you'll see Hyundai, Kia, VW, Audi, they're all ours, but again, benefiting from the economies of scale. Am I running out of time? And then obviously, the other thing that be benefiting from is the car rental business that we know during the -- COVID took the biggest hit, the importers and the retails carry them. Now the car rentals come into life, and they bring very good things, and they're benefiting from the international tourists, the local tourists. They're not benefiting so much from you guys because you all took lever on Teams and Zoom. So you're not traveling enough, but travel more, our cars are available. So we need a bit of that business and government, we're not getting enough from because they're not spending. But that business is benefiting fantastically from the international local tourist and the replacement business. So I think they're doing quite nicely from that. The other thing is that, yes, Transnet's got its problems, but that's our benefit. If you look at our HINO business, our Isuzu business, you look at our Mercedes business we're pumping at the moment because those trucks break down and you got to repair them. And some of our big corporates don't actually bring the trucks in for their daily services because the trucks need to be on the road 24 hours. We have service outlets in their businesses. And that's what to make sure that we protect our parts business and we're there. And it's a big job, then obviously, we'll it tow it into our dealership, but the trucking business is doing very well for us. So we're not complaining about Transnet's problem. We're benefiting from that. On the Mobility Solutions business, it's a very good annuity cash generation business. So that means when you sell a car -- if you sold a car last year, that car is still in my pool. You sold it the previous day, it's still in this pool. So this business has got a 2-year lag. So if you sell less today, I'll feel it in 2 years from now. I'm not feeling it today because I've got the benefits of those old businesses, which is annuity income and cash flow. But then we're very fortunate that we've got a great team in Mobility Solutions that are creating new products all the time because they're creating new products, dealing with different banks at different times, they're popping that revenue up. So when the car sales, you start feeling 2 years going down, this business will go up and they'll have that balancing act. And like you know, it's annuity and it's cash flow generation. I mean these funds are over ZAR 3 billion now that we're holding in our balance sheet. So we've got that cash. So again, it's very good at giving stability to Motus, where people are very innovative, digitalization. It sounds like a s*** word, but they know how to sweat the data. And that gives them better quality data to make sure that the service plans, maintenance plans, all those products are sharper. We don't burn rates of over 80%, 90%, then you lose money. But they've got the IT, they've got the AI to help them make sure that we've got very good quality data in there. The aftermarket parts, what I said about the U.K. is very relevant for South Africa, cash generative, people are buying down, people are holding on to the taxis longer means we sell more parts to them. So that business is doing great stuff internationally and locally. And China is doing well as well. We've got some issues in South Africa with our IT, but the guys are doing a great job in picking up the problems early by end of June, I think they'll have sorted those issues out. Fortunately, those IT issues are not affecting the sales at the counter. The back office, which we're sorting out, but that will be gone in the next 3 months with all the people that are putting resources in and the amount of money we're putting at that problem. The international operations, like I said, the heavy commercials in the U.K. are also doing well. So I think that's giving this group a very good, stable platform. Okay. This is easy because you guys will find it easy on the eye. You can see where the dips have come and where the -- where we've reached the top of the peaks. So you can see import and distribution. Ockert will go through a lot more detail by segment, but I'm just giving you an overview. That's where we took a bit of pain on the import side. The retail rental came across nicely with car rental and the international operations. So rain is not taking your thunder way, the car rentals in there as well so you and Martin can be satisfied that you're contributing to the group. You're not free launches. And then Mobility Solutions, minus 2 is virtually a flat business, I mean. And then aftermarket parts, I mean we've talked about that. And MPD is there for 6 months instead of 3 months in the previous year. Don't get to hung up on that, MPD's here to stay. So I don't say must take this out it's there. It's in the base. It's going to be there next year. It's going to be there the following year. And it's going to be bigger, relax, it's going to make money. When you look at the EBITDA contribution, obviously, the importers, then you can see retail rental doing nicely. Mobility Solutions, despite the decline in turnover, you can see they manage a very tight business that you still got a 5% growth in your profit. And obviously, the aftermarket parts growth is great now. And it will be moderated next year, because we'll be comparing 12 months to 12 months, but still be very positive about that. Same thing with operating margins. You can see some nice pictures here, except for the importers but they were artificially high previously. It's their time for us to help them, and they'll write the storm. And in a year from now, they'll create their own normality as well. Okay. That's all the hard work and the strategies and that kind of thing, but where is Motus landed for the 6 months. And 6 months are always hard because this is not -- you've got to multiply these by 2 to see the full picture. So you can see our turnover is up 11%, ZAR 57 billion, multiply by 2, this is ZAR 114 billion business. There's plenty 0s behind the ZAR 114 million. So we're quite pleased with where we're going with the revenue, the EBITDA has danced quite nicely for us, 13% up in these very difficult times, buffered partly by the MPD. But if you take MPD out, it'll still be 7%. So the details all there for in Ockert's reports and things like that. Operating profit flat, flat in a very difficult environment, a very competitive environment. So I think it's a great job. The profit before tax, there is 1 line item that caused us, which is the interest bill. And Ockert's going to spend quite a bit of time explaining the interest to you. But there's only 1 item. That's the interest bill. So I don't want you to walk out of here and saying profit before tax minus 25%, look at the ingredients that make up this business. If we were stuck with our stock, yes, we've got a problem. We're not stuck with our stock. We've got bread and butter vehicles that we sell. We will sell. Parts bread and butter air filters, oil filters, brake pads, we're selling. And if they slow sellers, there's an adequate provision to cover that. Mobility Solutions, very consistent profit maker. So the minute you bring your stock in line and your car rental and you bring the interest bill down then focus on the top 3, which will then follow into the fourth column, the fourth number there. It will all fall there. Unfortunately, it's not going to fall by June because we're in half year now. But if you look at 2025, this picture is very different because by that time, we've created a new normal. With it, obviously, the earnings and the headline earnings then go in line with that, and that's what we're seeing here. Despite that, we're not panicking. We're going to pay the dividend. We've got enough plans. We've got -- Ockert's going to talk a lot about the bank covenants and things like that, but we're very comfortable that we can pay a covenant -- a dividend and be comfortable with our cash flows. Okay. The highlight here is that net asset value. I mean, like I said, we -- $100 net asset value and you can come and touch and feel our assets. Don't have to worry that we have fly by night or we got too much goodwill or we've got too many intangibles in there. We're very confident about that NAV. The debt -- the equity to debt structure, we normally give you a different formula, but this displays it better. And when you're nonexecs tell you well done, then you know you've picked up a good thing. And Ockert realized that we were not giving you the true message and he did a bit of research and he said, this is a better way of disclosing who we are. And it's much simpler to understand that for every $0.52 (sic) [ 52% ] of equity we borrowed $0.48 (sic) [ 48% ] is that ideal no. We'll get there, what's ideal? Get 60% equity and 40% debt. That will be the perfect position to be in. But that's our target for the next 18 months, and we should get there. That's free cash flow, we talked about ROIC. We haven't destroyed your money. We've given you some return on your money, not enough, I know, but we will get there. Covenants, we're well within the covenants, but Ockert will explain that in a bit more detail. So that gives you a highlight of where the group is. And now I'll hand over to Ockert to just go through the divisions and tell you who spent money, who wasted money and who should keep a job. Thank you.

Thanks, Osman. Yes, I think if you look at this overall number, and I mean you just look at the financial numbers by itself, I mean, it's quite evident if you haven't -- if you walk out again, you don't realize this is a resilient group you've missed it. I mean, we had so many headwinds and challenges in this group. But yet, you actually walk up with a number when you look at this and you say, well, your EBITDA still grew 13%. How does this all happen? I mean there's really 3 things. I mean, Osman touched on most of those. I'm not even going to repeat, but you have to understand, there's been a huge amount of challenging economic environment and the supply chain caused havoc in really the last 18 months, and it's only really started stabilizing. That would be the first one. The second one is then around more of the financial discipline of this group. So firstly, you needed to understand what you've got, where the debt levels were, what your cost bases were and what you could potentially do about that. And I think the financial discipline this last while has actually been fantastic. And that is probably kudos to our teams and really, really grinding it out. And the last one is an interesting one, and Osman also showed in his slides, they're saying, we didn't actually stop investing. And I think that's the -- that's maybe the one other part you need to take out a year, this group is not afraid to actually go in and invest the money in the long-term sustainability. It's quite easy to say, well, let's go and cut the interest line, we actually just stop spending completely. That's not what we did. If you look at the CapEx, we still spend on capital. We spend on digitization. We spend a lot of money on innovation. We spend on our IT systems. We spend on that route to market within the aftermarket parts. We bought 2 businesses in the international space. So you didn't actually stop and freeze up. We spent -- we allocated a lot of additional resources and money into the car rental space. That's an area that's growing at the moment. Don't forget about it. So you could easily tone down and say, well, I can't spend any money because we started the year on a high stock levels and then he actually frees up and he will not create the long-term sustainability of this group. So I think that's the other part you need to take out of here. If you look at the financial numbers by itself, Osman already spoke about it, revenue obviously up EBITDA, a fantastic number. And obviously, the operating profit grew by 1%. And you can see, yes, we did have the additional contribution from MPD. Lastly there only in for 3 months, another in for 6. That's really the only sort of meaningful number you need to understand where there's not maybe a like-for-like. The rest, I think, was all the recoveries that we spoke about. And like we said, despite the headwinds that was there. If you look at where the revenue is now being made and some of the contributing factors, it's quite interesting to see how this has actually shifted quite a bit. I mean, if you look at the overall profitability number here that tells the story. But if you just see where the source of revenue is coming from. And the fact that it's now 45% of your revenue comes from an international base. You can see how quickly that has shifted over the last few years and also a number just to take into account. And then obviously, on the right, you can see where we're getting it from. And you can see the sale of parts is suddenly becoming quite meaningful on your revenue line and obviously on your operating profit later down as well. Below the line, I suppose the number that's the one that you need to talk about immediately is around that finance cost line. Everyone looks at it. You can immediately be scared saying, sure, look at this finance cost against the prior year. And that's almost where you go wrong initially. Don't look against the prior year because the prior year, you came out of a base where you actually didn't have any vehicles. If you recall, we were standing here about a year again, we said we eventually just received the stock. But for almost 6 months, you were literally just waiting for stock to arrive to actually sell. So you're on such a low base that the ZAR 485 million is probably another good reflection of where a normalized position would be. In the current period, ZAR 1,124 million, it is slightly higher. I mean we also criticized ourselves. Yes, we can shave off a bit of this, and we should. I mean if you start generating more free cash for now as in the next 6 months, yes, we will start shaving off even more on that. But are we on a new base? I think you also need to understand it is a higher base than the prior year. So I think just a comparison against the prior year is probably where you go wrong. So slightly higher working capital. Can we still shave a bit, yes. vehicles fire. Vehicles for hire, yes, we're in it, and we're still going to have those vehicles at least till the end of March before we really start de-fleeting, currently having good utilization rates. So not wanting to spend less on that for the immediate future. The financing of the acquisitions, obviously, it was not in your base for the prior year either because you don't have the finance cost for the full period. You only acquired at NPD, which was quite a large acquisition, it was ZAR 3.7 billion only on the 1st of October. So prior year also, we only had it for 3 months now, it's obviously in for a longer period. And then yes, the interest rates. We all thought we're going to have the good news standing here saying interest rates are reducing anytime soon. We don't know exactly when soon is, but I'm sure [indiscernible] will have his finger on the pulse there to see what we need to do. If I turn the page, just on the income tax, not really that much -- I think it's in line with what we told the market before. As you can see, the countries that we operate in, they're all sitting really big bases in SA, that's 27%. U.K. is at 25%. That's pretty much where we're going to find your landing. Yes, we have a little bit of exempt income driving it closer to the 25%, but that is what you should expect. So that 25% -- 25.2% is the effective tax rate. So there's no fundings in that number. And then, of course, the headline earnings is playing its part from the top, there hasn't been a lot of share buybacks in the last year. So not really much that you -- could give you an extra kick on that line. So your HEPs down 27%. But as Osman said, we're still very confident. There's been a lot of cash generated and the interim dividend will remain at this 35% from now, ZAR 2.35. I'm sure I'll have a few smiling shareholders if the -- at the end of the next month. Your kids always arrive and they say, okay, so what should we talk about first. The good news or the bad news. So I could easily swap all these slides around, but decided to go for the bad news first. So the importers are having a tough time. If you see the sweat in their faces, they're really working hard at the moment. But they have it very easy in the previous year and made just a bit harder now. Maybe there's a bit of that in. So it all goes and swings and roundabouts. And for the time being, they really need to work quite hard to maintain the, firstly, their market shares. Their margins have come under a bit of pressure, as you can see from the ForEx, et cetera. And but they're still holding their end. I mean, you look at it and you say, well, despite all of that, it's not like it's all doom and gloom and the operating profit is still sitting at ZAR 377 million for the period. Operating margin at 3.8% much lower than the prior year, which was probably a bit elevated. I think anyone looking at that over 6% that we added at 1 stage. We would love to be there 1 day soon again. But for the time being, we have to sweat this out and the teams are working quite hard. What can we do from an overall perspective, I think the first one that you need to understand is that we need to move vehicles still to make sure we get all the variable margins and the targets we need to make. So we put a lot more vehicles into the car rental space. So you can see prior year there were no vehicles available. So what needed to happen is very few vehicles went into the car rental space. This time around about 30% of our sales did go in there. That, of course, does have a bit of a knock-on effect on our profits in the first half as well. So hopefully, in the second half, we can pick up a bit more of that when you have less going into that space. Forward cover always arrived in this February meeting with some other unbeknown reasons I arrived. And when I look at the rate, I almost have to double check. Is this the right rate that we may actually make a typo because I did check the exchange rates were this morning. And if you look at that dollar and you look at the DRI rumor, this is worth forward points. So this is supposed to be much higher than what you see on spot on your phones this morning at 7 o'clock. So still giving us protection. Yes, it will only give protection up to a certain point. We put out there July, obviously, we've now bought into August already. So we do have cover. Yes, it's at good rates, but the replacement further down the line is probably the worry on that front. And hopefully, we have some reprieve in the next 6 months. But at the same time, as we've said before, everyone is in this boat. So unfortunately, for South Africa, we are a net importer of vehicles and/or components in the end. So even you manufacture, you import quite a lot. Retail and Rental overall, actually by a good result. Obviously, there's a mixed bag in there as well, and that's where the diversification comes in, not everyone can fire all cylinders at the same time. And I think that's actually the beauty of this business, why it's so resilient. So you've heard Osman saying, Australia is having a fantastic time at the moment, almost can't stay ahead in delivering as the stock comes in, it just flies out. So that's great news. Will it last night, I'll also go through a cycle and probably taper off at 1 stage. But hopefully, at the business they said business will pick up again. So I suppose it is all around the swings and roundabouts. The U.K. business is also giving us very good margins at the moment. So we'll take it with the guarantee where it is, of course, if you're making a good balance, you multiply it 24 50. So I hope it's a good month. I already really spoke about the SA Retail and vehicle while we were talking, but maybe just on the vehicle rental side. Vehicle rental, I mean, a good space at the moment, you could see there's a lot of new tourism activity there. We're slowly building up to the levels we were at pre-COVID and this is all around utilization rates. So the utilization rates at over 70%. This is where we try and pitch it. And I know in the last while that's actually been quite busy in Cape Town, again, to see if everyone continuously want to go there. So, Anthony, maybe I want to come and visit you, I'm not sure. But it's always good to have all these conferences. You have a week of, say, a [indiscernible] you actually just can't stay ahead of the game on your car rental. So very good numbers there. And you can see its operating profit grew 56% from the prior year. U.K. retail, like I said, already very good results, mainly in that commercial DAF space. So that's where most of the profits come from. So 44% up on its operating profit, and that's part of the resilience we were talking about. And then I show you Australia. So this is not all about this new acquisition, and Osman spoke about Wagga Wagga, and, yes, it does have a beach, although it's in the middle of the country. But that's not where the profits really came from. It came from the existing businesses, it was still there. We got quite a lot of on the Ford brand there. So Ford was a particular winner in that country as well in the last while. So while the going is good, we'll take it. I mean, it's 66% up on the prior year. So that is a really, really good result. And we start the synergies now, I think that's the benefit of the growth we had in the last while is you don't put more into the overheads at the top and we will see good results still going in the -- for the next while. Mobility Solutions, a lot of time and energy has been spent onto, like I said, onto the digital platforms into the innovation side. I'm quite happy to also invite all of you, we will have a showcase of some of these innovation. I think quite a few of you have said before, but exactly what is India. It's a bit of a mystery. We don't want to share all the trade secrets with you, but we will showcase some of it our Investor Day in June, and that will be a focus around mobility solutions and innovation at that stage. But as you can see, they've now stepped up the bar even higher. It's over ZAR 600 million now. And like we always say, this is another business is suddenly going to double. It continuously just to improve over time. And all that annuity income streams just keep on coming through this business. So as they sharpen the pencils there, you can see we are on a very good base and will be for the foreseeable future. Aftermarket parts, like I said, when your kids bring the results, you eventually get to the really good results and this is a business that's been performing exceptionally well. Yes, it was benefiting from all the acquisitions in there as well. But at the same time, we've bedded a lot down. Is it at an optimal level, of course, not. And if you turn the page on the next slide, I mean you will hear that the aftermarket guys will even tell you, we scored some own goals in South Africa. So it's not at its optimal level. We haven't got the synergies yet into the international space. So there's quite a lot of upside still to this business, which has not been realized yet. But at a margin of 8.4%, this is a good business to be in at the moment. And obviously, it was 49% up year-on-year. If you look at the different elements in it, you'll see the SA was actually not performing where we wanted it to. Yes, we needed to go and spend a bit of money now on like IT systems, getting our supply chains right, which had maybe a bit of a glitch there along the way. But at the same time, we are facing a lot of consumer pressure as well in that buying down, and that's where you need to have the right product at the right time. Canopy business performing very well, and that gives us a nice level of other hedge there. But then, of course, the international is where you see the real benefit. We speak a lot about the U.K., maybe not so much about China. And I think what is there in the background, which you're not seeing and you have to take it into account even when you look at the SA numbers, he's saying, well, a lot of this benefit on the stocking is actually coming from the from the Asian side as well. And I think the benefit of the integrated business model has now started to come through here, and you'll see that in the detailed numbers on your slides. Financial position, the balance sheet really not that much to talk about. I think as Osman said we're still comfortable with the level of like goodwill if you take it into account for all the other tangible assets. The numbers that's really increased here a lot was obviously your vehicles for hire. That's the car rental fleet. So it's the fleet that we've got. So it's not just the Europcar ones. It's also where we supply fleet to our competitors. So some of our competitors also maybe got some constraints on their balance sheet, so they actually lease from us. Those vehicles will come back to us, and we'll still make a second turn on the used car sale. And you can see the vehicles for hire, maybe at a slightly higher level than what you were expecting in the past. That will come down towards June as you are defleeting. And on the net working capital, I think it's better to look at the next slide where you actually see the breakdown of it because initially, you think, well, the working capital didn't really move much. But the inventory actually came down with over ZAR 2.5 billion. So the reality is the inventory almost came down with more than that, but then you had Australia, like we just said, no, we suddenly went into a new cycle. So they ate up a little bit of the good news from the reduction. And then the big bad wolf still in there is that bodybuilders in the U.K., Osman mentioned it briefly around how long it still takes to actually get it through. For, first world country, they do seem to take their time to resolve a problem which I thought they should be resolving fairly quickly. But as an industry, they are battling with that bodybuilders and it takes too long for the vehicles to actually go through the cycle of ordering to final delivery. And in that period, is still sitting on our inventory line. We did use some of the money obviously coming out of the inventory to reduce creditors. So you can see both -- those lines are both down. So it's not all just on debt. And you may say, well, why don't you just pay down the debt. A lot of your creditors are also interest-bearing creditors. So on those floor plans and so on, that's interest-bearing. And sometimes the rates for those are actually worse than what you get on your other debt. Contract liabilities, that's obviously a service and maintenance plans. It's not much that we need to say there, and then you can see what the total debt on the balance sheet is. I'm going to spend more time, I think, we've already spoken a lot around that. So maybe just on the free cash flows. Obviously, you can see there was a lot of free cash flow. If you look at before that working capital, I mean, it was ZAR 3.9 billion. That's what you generate out of this business. And then you almost need to decide where to spend it and spend it wisely. And if you go to the 3 slides on, we actually have the graph, I'd like to show some pictures I don't think we can always just show you our numbers. And if you look at that graph, you can clearly see where the two big green blocks are. And the one was around this free cash flow out of this business is immense. I mean, it's ZAR 3.9 billion is in 6 months. That's how much cash you can generate by just trading. The second one was the ZAR 2.5 billion that we actually did through the reduction in inventory. And those two are the two sort of inflows and then you needed to decide how you're going to do the outflows. Obviously, we did spend the most of money paying down some of those creditors with, like I said, the high interest rates, but then also that vehicles for hire where your other big blocks it. So overall, I think it was -- money was wisely spent. Obviously, trading-wise, the guys need to really work hard to make it. And at the sense, you need to be very sure where you're actually going to allocate the cash that you've made available. Obviously, we still keep up with the dividends. And as you can see for the period, it was the ZAR 700 million that was paid to shareholders. I'm going to hand over back to Osman.

Thanks, Ockert. I know there is a bit of repeats when Ockert and I talk, but that's the nature of the game and you used to it because when I talk about the business and he talks about the numbers, there will be some overlap. So we apologize for that. On the ESG side, like I said, we haven't stopped doing the things we need to do. So on our commitment to transformation, you can see we had the black representation of group is 78%. So don't worry about the white guys. They use still a job with us. The percentage is dropping a bit, but we're still keeping everyone happy, and we've got a fair balance between skills and transformation, and this is the key balancing number that we have. So we've done a great job in terms of getting our black representation up. Our DP presentation at 55%, we've come a long way. That number used to be 30% and 34%, and we're sitting at 55%. The female representation 32%. We said, guys, we need to move that to 40% in the next 2 years. So there are plans to get there. But we're very passionate about some of our projects. And the one project is the education project where we got 75. We're already at 77, I think, already since presenting these slides. We're touching the lives of 85,000 children with 81 librarians. This is not a picture opportunity. We're in the townships. We opened the libraries, we fund them with 5,000 to 6,000 books. We paid the salaries of the 2 librarians working there. We have an admin office, and it's funded by Motus -- Imperial and Motus Community -- that's DP World and Motus Community Trust. But we do that and we get no government subsidies. It's all funded by the group, and that's what we do. And for your interest that if Motus and Imperial stop funding that, we've got ZAR 100 million base in that business that will carry us through for the next couple of years. So this is an initiative started exactly 20 years ago, and you can see the benefits of it. And then this is Berenice's passionate program that she started from 0 to what she's got you. She's going to 2,760 schools, touching the lives of 2.3 million learners, not to go take pictures, train them how to cross the road, the cops -- the aprons they need to wear and things like that, and she's very involved in this process personally. So she's quite actively involved in that. And then obviously, with the Unjani Clinics, I was there initially, but [indiscernible] spending a lot more time there. This is taking our containers into the township. So if you have little ailments, you don't go send the cure hospital, you come to these clinics. And within 4 to 5 years, the nurses that run those businesses own them. So that's the deal that you continue paying, but at the end of the period, it's yours. So we're very excited about these CSI projects that we involved in. Okay. So in the short term, what do we want to do? The first 2 slides are making sure that we make this business stable in terms of a cash point of view. So we've got targets set for our stock, the vehicles for hire, working capital. And the vehicles for higher, just remember, in case you forget, it's a 9-month business. So you fleet up from July right up to January, February, March, then you defleet April, May, June after Easter weekend, basically, you start defleeting and that's when you release cash in April, May and June. They come from car rental into auto pedigree and our dealership network, and we have to sell them from there. So that's an automatic cash generation that takes place every year. So December is the worst month for car rental in terms of the stock and then it drops down by June and they come to a level. That's a historic thing. In COVID, it was easier because the base was low. So you -- from the 10 stories, you only came to 7 stories. When you're in the 20th story building, you come to 10 stories. So that's why we'll see quite a bit of a jump in our vehicles for hire at the end of June. So that should help us with our debt reduction. The capital expenditure for my colleagues. I know you wanted ZAR 500 million. Ockert hasn't approved that. So you'll have to come sing for your supper whenever you want to do your CapEx and then he will decide what he can approve. So he's a reasonable guy, but don't think what you're putting you just going to get approved. So he'll look after you, but he's going to be critical. So we've seen quite a bit of debt reduction coming from our working capital of vehicles for hire. And the CapEx is going to be maintained. So we don't intend going wild on CapEx. And in the short term, there aren't any major acquisitions we're looking at when I talk of short-term, I'm talking to June. So we've got another, what, 4 months to go. So we'll start again once the debt is right, then we'll start again with other acquisitions and things like that. Interim dividend, we've spoken about our continued investment and Ockert's talked about that investment day and we'll boost a bit what we've been doing without giving trade secrets away. So we'll talk in a cagey way to you. But I think we also need to show you what we're doing, and that will be covered and those invites or save the date will come out soon. And then after that, you'll get a proper invite as to what we want to display there. And you'll get a better feel for what we're actually talking about. And the bolt-on strategy acquisition, that's going to continue like we've just done. But from July onwards, we've got some 2 or 3 things we're looking at. We will spend more time on that and make sure that in -- by 2025 June, we put something more into the spot as well. So we're busy working on that all the time. Okay. The most important slide, Justine, I'll be okay for time now we made it. We caught up some time. Okay. So like I said, guys, navigating business at the moment is very difficult, very challenging. So it's not going to be easy in the short to medium term, but our plans are giving us good stability and giving us a good balance in our portfolios. What do we expect? We expect to deliver positive revenue and EBITDA growth. So we're saying that with the plans we've got in place, what we've done in the 6 months, we should see growth in revenue, and we should see growth in our EBITDA. So don't go home away from this and saying, these guys are all falling down. There's good potential here. We'll see some growth in both those EBITDA and revenues. And obviously, not all of it is coming from one item. We're pressing a few buttons. Costs obviously are a big thing, making sure we're only spending where we need to spend and making sure that we work on that interest bill as well. So we're pressing a lot of buttons and my colleagues know that every meeting they come, there's no easy arise. We're very critical of where the business is, what we need to do and how we need to manage our profitability and our cash flow. This is one number that is very difficult to judge if you're sitting outside the business. It's that interest bill. We've had our worst in the 6 months. Ockert's talked about the low base, it is an artificially low base, but I think we artificially -- not artificially, we're high now. Second half, it will be marginally lower than what we've got. But in 2025, we'll create a new normal with our interest bill. Not good news for the bankers, but guys, we also need to protect our business. So [ Corbus ] just talked nicely to the bankers and get our interest billed out. Our initiatives are not our people only. So the OEMs are helping, which are the local and the foreign guys. The suppliers are helping. Everyone's coming to the party to create what we've got and our people, obviously, without our people, we don't have a business. And with the ExCo management team pressing the right buttons from a leadership point of view, I think that the cash management and the debt levels will come down because they're all aware of what they need to do. On the strategic initiatives, we've talked about enough. All I'm saying to you is that remember, these are strategic initiatives, don't expect everything to happen by June '24. We're in the long term. So if you look through the cycle, go to June '25, June '26, what's the key thing that will happen in the next 2 years? Your interest bill must come down because we've created the new normal and hopefully, interest rate starts falling in the jurisdictions we're in. So you should see that in the next 18 months, 2 years. So if you're looking for a sustainable business, would you go backwards [indiscernible] must grow. Why can't it grow? Because you've got the tailwinds of the interest. And then you've got some good tailwinds in some of the sectors that we've got aftermarket parts, I spoke a lot about Mobility Solutions, stable. The retailers are doing good things. So they'll hold what they've got and there should be some tailwinds in the importers as well. So that's why we believe that there's sufficient diversification in the 4 pillars that they'll fire on at different times. And in the next 12 to 18 months or 24 months, there's a lot of tailwinds that will push this business forward. And we believe that the worst of debt and interest bills are behind us and from now onwards -- from July onwards, I think we'll be more in a better position to be in. So thank you for listening to us. I don't want to sound like accountants where we explain everything, but we're explaining with our strategy. So hopefully, that gives you a balance between where we are and where we want to go to and hopefully, we give you a fair view of what we -- how we're seeing this business. Happy to take any questions. Justine, are there any questions? I mustn't forget on the line as well. Shall we take 1 or 2 here first, and then we go to the lines? We'll take one there and then we'll take Anthony as well, yes. Because he has come all the way from Cape Town, so we will have left to listen to him.

Abigail [ Visagie ] for Nedbank. Congrats on another robust set of results in order is a tough environment. I mean my question is just around the earnings splits or the EBITDA splits that you had. You obviously said a number of years ago and came up with a 65, 35 and the 50-50. So my question is what inform that decision back then. And given the path we followed both in South Africa and your new acquisitions and how they bid it down, is that still the right number going forward?

Sometimes age is a good thing, isn't it? So because of my age, I went through the global financial crisis. I went through the World Cup, where Hyundai sold the most cars in this country. Then I went through the global financial crisis where we dipped by half in the vehicles that we sold. Then came COVID that left scars behind. So you couldn't forget those scars. And what were those scars? Those scars were to say, guys, not every business is going to fire on all cylinders at all the time. Look at your vulnerabilities. Where is this country vulnerable? Economic growth, interest rates, and what was that -- and fragile consumer. What was that going to impact? What's going to impact? My cars. In my case, it was going to impact the importers and the retailers. So we were very worried that if that's where this country is going, we better top this business up. It's not going to fire on all these cylinders forever. Don't rely on them only. They can only do it for so long, go look for something else. And that's when we realized that this Aftermarket Parts in South Africa was doing it. So why can't we do it elsewhere? And that's why we started with Malcolm and the team to say what else can we do? And that's why we did FAI and then MPD. We had to balance this thing. But let me tell you that the global financial crisis, COVID taught us lessons and I think we're good learners. We learned and we said, what do we do differently? And that's why we went on that journey is that we have to find a way that the importers are doing their best, but they were on a crest that I was very worried about. And I knew it's going to do that, but I needed something here and that's what helped bring this plane and balance it. So it could go through the turbulences that we're going through. Hopefully, I've answered your question.

Is that the right number going forward.

In terms of my split between local and foreign? No. I'm encouraging management with the plans they've got the strategies that I've talked about in the next 2 years, it should be a 50-50 business. 50% foreign income, 50% local income, not because South Africa is a bad place to do business, the problem you've got in Aftermarket Parts, I'm big. For me to do more deals, it's hard from a competition permission point of view. As far as the retailers are concerned, the Asian Brothers are coming in with the force. The Asian Brothers don't like distributors like me. So the Havals are going to come in, the Cherys are going to come in, the Suzukis are going to come in. The BYDs are coming in, they're coming, but they come themselves not through an importer. So I'll have a few dealerships, but that's not we make the real money. We protect the family from famine in that, but it doesn't make the real money. So we'll have a few of those, but that challenge is coming. And let me make my point to you a bit more differently. India sells 4.1 million cars in case you haven't been to India. What's Suzuki's market share? 40%. 1.6 million cars are sold, Suzukis are sold in India. So if they throw 100,000 at us, does it impact them? No. But to us, it will be close to 28% of our market share. You've got to understand the dynamics that are taking place in China and India that are going to impact us, and you're going to plan for that accordingly. And if they're coming, you can only react so much because South Africa's car market is stagnant. So what do we do? We steal from each other? How much can you steal from each other? That's why you create -- you do other things to protect your vulnerability. Anthony?

Two issues. The first one is on the U.K. environment for used car sales. So your margin went up in the U.K. Obviously, you had a fantastic revenue performance, but the margin went up, subgroup also reporting this morning their margin got hammered. And they're talking about this issue with used car valuations, net realizable value. So can you just provide a little bit more color on that? And then my second question is around the car rental market and the extra volume of cars that you are leasing to competitors, which I presume is the reason why your depreciation charge in the import business went up so much. So there's a gap, the gap between the EBITDA and the trading profit margin has opened up. And then what you expect in terms of some of those leased cars in terms of the cycle, how quickly they will come back and affect your working capital in that regard?

Make sure that Ockert doesn't get a free ride. I'll answer the first question on the U.K., and you can think about the second question because otherwise everyone thinks I'm the only one that's getting paid here. So let's go to the U.K. We're very fortunate. And fortunate and luck comes sometimes hand-in-hand. So 80% of our profits -- no, let me break that down. I've got two big businesses in the U.K. I've got the vehicle business and I've got the Aftermarket Parts. Aftermarket I said enough about, okay? So you park that. Now let's go to the commercial business. We're very fortunate that out of the 115 dealerships that I've got, 80% of them are trucks. On the trucking side, we're doing well because we're dealing with the corporate world, they've got their orders in and I'm delivering. And I'm backing a horse called DAF, which got 1/3 of the market share in the U.K., and I've got 1/3 of their share. So when you got a big car park -- a truck park like that, my workshops get very pretty busy. And the workshops then generate the parts profits and the workshop profits, and we upsell as well. And the other thing is that in the U.K., your trucks must go through a physical or fitness test every 6 months. We have some of those test centers in our dealership. So they come in, we got to do that. But we all upsell, don't we. So we'll tell him, your brake pads another 2,000 kilometers, can I replace that for you. Can I replace your [indiscernible]? Can I put your mud flaps in? So we upsell that way. So we're very fortunate that the commercial side of our trucking business is doing well. And we all know in the U.K., the English are very good at moving people on trains, not goods on trains. They move a lot of the -- all the goods are moved on trucks. So we're very fortunate that the truck business we're in is still doing well. We're backing the right horse and that Aftermarket Parts, workshops is still doing well. So we're not suffering the lot. Now you got to the passenger side. What happened to the passenger side, with the new cars starting ramping up, which is Ford, Toyota and Hyundai, Kia and Vauxhall and SEAT and SKODA, the new cars are coming, so what happened, the used car markets are not going down. And a lot of people, I don't know if you saw the Inchcape results, what provisions they needed on the used cars because the book fell. We have an M&A book in South Africa, they call it something else. But their book fell tremendously in October and November. They needed big provisions for that. Now we were fortunate, yes, we also needed provisions. But because it's a small part of the business doesn't impact you badly. Had I only had passenger and no trucks, I'd be leading poverty here. I've been real trouble because that book fell materially. And why did it fall? Because the new cars started becoming available, and there were good offers on the new cars. So the guy said, why do I buy a preowned, let me go buy a new one, and the market fell. So we were fortunate the impact on us was low and the commercials have kept us alive. And the provisions we had to create for those 2 months was a material, a; b, fortunately, the provisions are reversing now in January and February that it will be created. So it's coming back now. So that was why we didn't suffer a big problem in the U.K. on the passenger side. But our colleagues in Pendragon -- in Inchcape. In fact, Inchcape, I'm sure you follow the motor industry quite well, you'll see that they put up the retail leg for sale in the U.K. The whole business that they have in the U.K., they only want to stay in the importing business and they want to sell the retail business. What's the pain they go -- but they're big in passenger -- only in passenger, but we're not that big in passenger. Hopefully, Anthony, I've answered that question. Ockert?

So just to explain how that car rental model almost then works. So the importer will supply vehicles either to our own car rental company, which would be Europcar or also to the outsiders, which would be Avis and Blue and everyone else. If you supply to them and it's on a lease that it's coming back, so what you'll see in the financial results that's reflective, you did pick it up is on the depreciation line. So your initial discounting that you would do in doing the deal would immediately go through. And then after that, you would also still have the depreciation over that period. But you obviously get the benefit of the vehicle coming back. What you've got in the interim are is that vehicle stands on your balance sheet and you actually accounted for that lease to the other car rental company, you're getting that benefit, which is sitting in Mobility Solutions. So in our integrated model sometimes [indiscernible] but confusing in that sense because the vehicle goes from the importer effectively into the Mobility Solutions and they're leasing it out to the external car rental companies. So that's where the different parts are sitting. But you're right, that depreciation line is part of that.

You remember the other thing is that when those cars come back, either going to come back to Rhino or they going to go to Hyundai, Kia, Renault. That's where they're going to make money because they don't only make money on new cars, they get -- they need preowned, but what do they need? They need clean preowned cars where they know where they come from. Those cars come back here. So these importers know they're coming back, and that's where they'll make their money as well. So an added revenue generated and a profit generator for the importers in their retail businesses. Before -- Justine, I think there must be 1 or 2 questions on the line, so let's just take that as well.

There are a few questions on the webcast. First one, Motus has made strong acquisitions historically. Are there similar attractive opportunities still available in the market? And if so, which segments are you targeting for growth?

So the strategy will continue, which is -- we'll add on to the Aftermarket Parts out of the business. There's 1 or 2 we're looking at, but they won't fall into the '24 year. If we do anything, it will be in the '25 financial year. So there will be some acquisitions that we're looking at in the Aftermarket Parts. On the commercial and the passenger side, there will be bolt-on acquisitions in regions. So for example, if I'm strong in [ Davi ] and 2 dealerships come up for sale, I'll take it because then I manage an area. Say, for example, there's another area that has a few more then I'll take that. Now if you take the Australian market, if you take Traralgon, I can't add much, I'm the boss there basically. If you take ballarat, there's 1 or 2 available, but they're not selling, which are one, but I can't get. So we - there's 1 or 2 other provinces we look at as well. But am I going to Adelaide or am I going to Perth? No. I'm going to stick to these 2 provinces around Melbourne and Sydney, and bolt-ons will be what we're doing. So there are some, but nothing that will come by June this year. It will be most probably into the future as well. And Aftermarket Parts in South Africa, we do an acquisition of certain stores either people are retiring, children don't want to come into the business. We cannot have a store there. So we look at some stores over time just to bolster what we've got.

Next question is around the preowned space. There has been lots of activity in the preowned space in South Africa. What is the Motus strategy around preowned vehicles?

Okay. Motus has a strategy of looking after dealerships. We don't have a strategy for preowned new parts and workshops because we believe that if you've got an address, that address must make money for you, but it's got 4 legs on which we make money. We make money on new cars, on preowned, parts and workshops. So what's Motus' strategy in terms of what they want to buy. We don't buy cars older than 5 and 6 years old. If you do bring in your 8-year-old, we will take it in, but we will offload it immediately to a trader. What we call that, we call cover. So we'll phone the trader and say, I've got this vehicle. It's 8 years old. It's got 150,000 kilometers, what price can I get, they said ZAR 100,000. We go to the customer and say your car's worth a ZAR 100,000? He says, yes, I'll take it. We'll get him out of his debt, get him out of his car, put him into a new car. But that car doesn't go into our floor, it will go to completely to the outsider because what is Motus trying to protect? Motus wants to protect its brand or its dealership from making sure that we sell quality cars that we back. And if there's a problem, I can look after that customer. So if I take your 10-year-old car and I put it on my floor, it doesn't suit my image for starters, A. B, you're going to have problems with that car. It's a 10-year-old car what you expect. But because you bought it from a dealership, you want to come back to me. You'll drive it up and the [indiscernible] doesn't work. It's my problem. But did I not tell you it's a 10-year-old car. That's got 150,000. It's going to have problems. To avoid that and damaging our brand, either a Motus or Hyundai or Kia or Toyota brand, we don't damage our brands. So that's why sell what you're confident about and you can back. And that's why the strategy is no different to what it was last year, trade in what you want, if it doesn't suit you, go offload and if it suits you, keep. That's the one answer. The other answer is that, remember, car rental cars come back from Europcar, Tempest and sometimes my competitors. We've got homes for them, not only in the importer retail and Renos business, I've got 67 outlets called auto pedigree. We sell 10,000 cars a year, a year that come -- and the customer knows what I've got. I've got 1 year old clean cars, cars that I've looked after and they still got a service plan or whatever that I can put on to that as well. So the used car strategy is, firstly, it's a dealership strategy. And then for the 1 year olds that come out of the car rental business, whether it's our own or outsider, there's a home for it called auto pedigree, and auto pedigree will make its own profits from there and remain market related. And because of that strategy, I can have a dealership in Thohoyandou and Mthatha and in Bela-Bela. The new guys wouldn't want it because they don't get the economies of scale. But having a used car outlet, they make money because the customers expect us to be there at the right price with the right vehicles. And our auto pedigree is not a used car outlet for Hyundai or Kia,. No, they have their own. Auto pedigree will give you a Hyundai, Kia, Renault, Suzuki Toyota, everything because they buy from the car rental companies and they make sure that they give customer variety, quality and clean cars. So you've got to understand our strategy. It's not used cars, it's a dealership strategy and then we've got auto pedigree on the side.

The next question is around the Aftermarket Parts business. What is the future of the Aftermarket Parts business in light of the transition to new energy vehicles considering the impact on parts and servicing?

Okay. So I don't think I'm going to be alive when 50% of the cars in South Africa are going to be electrical. So what have we got? Now come, we've got 12 million cars in South Africa that we're going to service for the next umpteen years. The electric cars, what South Africa saw 3,000, 4,000 maybe? So when is the electric car going to get to economic scale where they're going to be -- and remember, once it's sold, 5 years, the OEM will look after it. So I'll look after it in year 6. So what are we talking about here? 2040, because we don't have economies of scale for the next 5 years, say, in electric, right? So for 5 years, it's gone. The OEM looks after it for another 5, 10 years gone. Then it starts looking for parts. And remember, the electric car doesn't mean it comes at no parts. It's still got parts in it. The parts will be different. It will be hell of a lot expensive. I agree. There will be more sensors, there will be more IT stuff and things like that. But when do you start seeing those cars coming, 15 years from now because of -- by the time we get there, 5 years the OEM will look after, then I look after them. So where are we, 2040. So by that time, sufficient -- there'll be -- the motor vehicles will evolve sufficiently to create a part for us to look after at that stage. And in fact, COVID has actually done us a favor. Because with COVID in South Africa, we noticed it in the U.K., the car parks -- the old cars -- the car parks earned bigger because people held on to their cars longer and be selling markets. In the U.K., the carpark went up by what, 1.5 years because people held on. Can you see the quality of our powers in South Africa? Hasn't they declined? You sitting your fancy [indiscernible] in front of you who's there. It's a small guy isn't it? So that's what's happening in our country as well. Yes, it's a concern, but we've got enough runway to worry about that problem, which will be a 15-year problem.

You expressed concern about the weakness of the rand. What will Motus do to protect new vehicle volumes and market share?

So fortunately, we're okay till the end of August because we've got enough forward cover. We saw that. If the [ rand ] continues at its current levels of weakness, Obviously, we go back to the OEMs and say, okay, you want to protect market share. But at 21 to the euro or 22 to the euro, we need this assistance. So it's something the OEMs are all sitting here, they're going to [indiscernible] are busy talking to the OEMs already. But the OEMs placing orders. They say, oh, the we cannot at this currency. So now they're busy in negotiations to say, what are they going to do to help us to buy at these levels? Because they also don't able to lose market share, and they're going to come to the party in some way or form to protect their market share. Because remember, don't think of us, think of their factories, their factories are running as we speak. But every economy is in trouble. So we -- an important player in their lives because, if we don't take it, can the Middle East take it? No. Can India take it, their economy is not [ great ]. So everyone is suffering. So they come to us, talk nicely, help us, and that's -- we'll be in those negotiations all the time.

The next question is around debt. Can you share specifics around debt reduction plans? And if possible, any targeted levels?

Ockert?

Yes, it's always difficult to say exactly what your debt target level needs to be. I think Osman did give some guidance. If you see what the equity to net debt is at the moment, it's 52% to 48%. Doesn't actually feel that over barring at the moment. Yes, it's going to come down. And I think in the short term, I mean, Osman spoke that you would want to try and get down to almost like a 60%, 40%. That's obviously a bit longer and further into the future, and that would be if you're not making acquisitions. I mean, if you can get to a 55%, 45% that would already be a very good level, so 55% equity and 45% debt.

Then the last question that we can -- we've got time for is just around the car rental fleet. Is your rental fleet currently at optimal levels? And how is the tourism segment performing?

So how do you quantify optimum level in the car rental business? The key factor you would look at is an ADR, we call the average daily rate. That means how much money are you making per day on a car that's one factor. The other factor will be the utilization. So if your utilization is anything 68% plus, you're in the game. Anything below that, you start defleeting. So at the moment -- Martin is here, Martin, you're running good utilization at 70% plus over 80%. But again, it's a honeymoon period. We're going to Easter weekend and then we're go into a cold Cape Town season, international tourist will pullout. So I'll be optimum as best as we can with ADRs with utilization. Again, the car rental business is a very complex business because if you've got 500 cars extra in halting, you can't just take them and push them to Cape Town. It costs you ZAR 4,000, ZAR 5,000 per car to move them for a 3-week session. Then when you move it back, you kill the profitability. So optimization in the car rental business, it's a few factors, the ADR, the utilization, how long will that season last and you will have cars in the right places. And we think we're okay for now. And we -- but we're preparing for after Easter, which is the defleet program. So Martin and Rina and importers know exactly what cars are coming, when they're coming, what they need to do with them. The bulk of the cars don't actually come back now for the importers. For Rina, they'll come back to auto pedigree. But for the importers, the bulk that's coming from July, August, September, that's when they get the bulk of their cars. So it wouldn't be in this financial year, it's in the next. But for the cars that come to auto pedigree there's plans. In fact, they're holding their stock very well. In fact, I think they've got about 3 months stock. They sell about 859 [indiscernible] cars a month. So they've got enough to balance their books. So optimum is in the eyes of the beholder and we look at a few factors, and that's how we manage that business. Okay. Perfect. Thanks, everyone. Thanks for your time. We've overran by about 10 minutes, but hopefully, we gave you some good insights.