Pepkor Holdings Limited (PPH) Earnings Call Transcript & Summary

It's great to be with you, unfortunately, not in person yet. Hopefully, the next one or maybe next year's result will be in person. It's again been an interesting year to say the least. The last 3, 4 years in Pepkor's history has indeed been interesting, as you all know, with all sorts of challenges and peculiar events coming our way and the last year was no exception. But despite all that, I'm extremely proud to present our results today, which I think is exceptional under these circumstances. And I'm humbled to thank the people in our business for what they've contributed during a very difficult and challenging year. People always talk about the culture in Pepkor and we're very proud of that. And I've just learned again that when you encounter these events, that if your culture is not already good, you can't build it during these challenging times. And that's where we've been fortunate because over the years, we've built a corporate culture that can really withstand all these challenges thrown at us. Our agenda for today, we'll start with highlights of the financial results, and I'll deal with that, because it's nice for me to deal with the highlights. Then we'll go on to the financial performance, and Riaan will deal with that, which is quite complex this year because of various circumstances. I'll then look at the business in the different segments and divisions of our business of the group, and then we'll have a short outlook on what we expect over the next year or so. So firstly, the highlights. 9.2% growth in revenue to ZAR 77 billion. Now that 9.2% is maybe a slight understatement. If we exclude the credit books, that goes up to 10.3%. And if we exclude the losses that we've had in sales during the unrest and looting in the last quarter, that probably goes to over 11%. So very pleased with those results. And from a sales point of view, I'll show you some numbers later on the CAGR over the last 5 years. And you'll see that it's consistent with the performance that we had over the last 5 to 10 years. Growth in operating profit up to 9 -- 39.9%. I asked Riaan why he couldn't make it 40%, but he says that's the exact number. But it's up to ZAR 9.3 billion, which in itself is a very satisfying number for us. It makes -- puts that ZAR 10 billion number within reach. And yes, something that we're very satisfied and happy with. Increase in headline earnings to ZAR 5 billion, which is 115.2% increase. HEPS increase of 106% and Riaan will expand later on in the financial section on that. And when you only have 7% of your business that operates on credit, then you're going to generate a lot of cash and the ZAR 11 billion is testimony to that. And then for those of you that are shareholders, and I hope many of you are, there's a dividend this year, which there wasn't last year, of ZAR 0.44 per share and I congratulate you all. You deserve it. And then just to show that we're still growing stores despite -- again, despite COVID and the uncertainty that, that provides -- or has caused, we're still opening stores. We're still growing. And in the last year, 247 new stores opened. Most of those were PEP and Ackermans. As we said at previous occasions, those are the more robust and profitable brands, and we keep on investing -- kept on investing in those brands despite the challenging times. So 247 stores, and I'll talk a little bit later about the future in terms of store expansion. As I mentioned, just a brief look at our sales performance over the last 5 years, just to give you an idea. You can see there a CAGR of 8.6%, which is special. But what I actually want to point out, except for the blip of the COVID year, which was a 1.7% growth, you can see that there's a relative consistent growth pattern. And if we extend this graph to 10 years back, you'll probably find that it's very similar to that. And that's the way -- that's the good thing about Pepkor. And it has been over time, we keep growing. We've got a growth mentality. We invest in growth quite a bit, and that reflects in what we've been able to achieve from a revenue point of view over 5 and many more years. Just in market -- in terms of market share, you can see the graph at the top there, and you can see a gradual improvement in market share and then a ramp-up as COVID started. That's the sort of shaded part of the graph. There was a very serious ramp up. At one stage, we gained 200 -- more than 240 basis points. As one can imagine, when your base becomes so high in that first year where we're really outperformed the rest of the market, that's -- that comes down because we've got to compete against that higher base now and the others not. So that's coming down slightly. At the moment, if you look at the last 2 years, then there's -- we've still got a 202 basis point improvement or sort of a rising market share. If you look at the figures since COVID started, it's 154 basis points that we've gained. So whichever way you look at it, we've been gaining a lot of market share. That number should stabilize relatively soon. And when we get to April, May next year, when it's sort of 2 years after COVID, then we'll get an accurate number of what the net gain is that we've managed to achieve over the last -- or since COVID started. Another big event this year, I'm sure you would want feedback on how we've been able to recover from it is the civil unrest that we had in KZN and in parts of Gauteng. Now we were the retailer that was probably the most affected by it, 549 stores that were impacted. That's about 10% of our sort of store numbers. 80 stores were burned down in the process. And I think you can imagine the trauma that a business goes through when that happens. And the emotion that goes with it at the time. But in true Pepkor fashion and in the brands fashion that are in the group, they quickly moved from the emotional part of it to the action part of it. And we started fixing the business and recovered and rebuilt it. We also lost 1 distribution center. It's well reported, but that was one of the JD distribution centers in Cato Ridge in KZN. Fortunately, JD has quite a spread-out distribution network, and they have 16 distribution centers in total. So the effect was relatively small, but that, unfortunately, we lost, or it was looted. The total net sales that we lost in the period because of this, that is now taking into account that in some stores that remained open, we probably gained a bit of sales when others were closed, but the net loss was ZAR 816 million. I also mentioned that at the beginning, which is obviously a big amount. A lot of our staff were affected, 2,300 workers work in these stores. I'm very happy to say that none of those staff lost their jobs. None of the -- all of those staff were paid during the period that their stores weren't opened. And for some of them, their stores haven't opened, we've redeployed them. So despite the negative circumstances around it, we could at least protect the jobs and the livelihood of the people that work for us. Something else that I'm quite proud of is the fact that the people in our business, how quickly they reacted. On the -- at the time -- on the crisis that was in -- especially in KZN there weren't food available, and within 1 week, we managed to organize more than 5,000 food parcels to get to our staff and the communities in KZN. And that was done within a week, it was delivered. So something that I'm also very proud of and that the team that initiated that can be extremely happy with. In terms of the rebuilding, 416 stores, that was like as yesterday, have been reopened. That's almost 80% of the total stores. The stores that are now left that haven't reopened are all due to property issues. Either the building was too much damaged, or the shopping center hasn't opened yet, or something like that. But the stores where it's under our control, all the stores that we could open, have opened. And I want to say a special thank you to everybody that played a part in that. One has to remember that on a normal basis, and I mentioned it earlier, we opened 247 stores a year. That opening program continued unabated. On top of that, within 2 months, we had to open or reopen and rebuild another 416 stores. So the achievement of that, I think, is just unbelievable. And to every person in Pepkor and in the different brands that played a role in that, I just want to thank them personally and say it's a job well done. For now, that's enough from me, and Riaan will deal with this year's very interesting financial performance.

Thanks, Leon. Morning, all. As Leon said, it's been a very interesting year. We thought last year was going to be interesting, but this year also turned out to be also quite a bit of a challenge with lots of things happening. So just again to confirm some of the highlights that Leon already mentioned, so top line growth or revenue growth of 9.2%. And I think it's not a lot of time that you can really say that all your operating companies, all our operating divisions have really seen a very good strong revenue growth, barring really the 3 books, as we communicated previously. That was really a conscious decision that we took last year already pre-COVID already to cut back on credit granting. On top of that, the drop in interest rates over the last year has meant that all 3, the books showed a negative growth in revenue. But overall, still achieving the 9.2% and all the operating companies showed a positive growth even Africa at constant rate showed a positive top line growth this year. Good news also to report is that we did see a slight improvement in GP margin this year. We were concerned early in the year that we might not have a positive growth, and that's really to do also with the impact of the books and the lower interest rates, an impact of that. But we did see, especially in the first 9 months of the year, a very good growth in GP where we had much lower markdowns and discounts and that played out in a 10 basis points improvement on last year. That would have been actually a 30 basis points improvement had it not been for the civil unrest, where we obviously, with the write-off the inventory in that period, had a 20 basis point impact, but I'll unpack that a little bit later more in detail. OpEx growth, again, for us, very important to control. So if you exclude debtors costs and exclude depreciation, we showed a growth of 8.1%. Again, partially impacted by the lower base last year, but also because we're really able with the results to pay much higher bonuses this year, which impacted that growth. Debtors cost, as I mentioned, obviously, significantly down, and I'll unpack that also later on in the presentation. So that all helped. If you've got a good top line growth, a low expense growth and improvement in GP, that your operating profit jumped significantly. And as Leon said, we ended up just short of 40%, being a good retailer, make sure it's 39.9%, showing a total number of ZAR 9.3 billion in profit. So the fact that we were able to cut back on debt, meant that our finance costs dropped significantly with lower interest rates. We also had a significant improvement on our effective tax rate. So those 2 items together meant that our HEPS or headline earnings per share and earnings grow at a phenomenal rate. So overall, you'll see the 107% growth in HEPS giving us ZAR 1.35 per share. Cash generation was still very strong. We were concerned last year with the above 100% that we achieved in the previous financial year with inventory ending up at a slightly lower level, that our cash generation would not be as good this year as where it was last year. But we were still able to generate ZAR 11 billion in cash from normal operations or 84% cash conversion rate. So as Leon also mentioned, very pleased of the suspending dividend last year because of COVID and uncertainty around it. Dividend is now again declared this year of ZAR 0.442, which is a 3x earnings cover. So we've reinstated the dividend. So as Leon mentioned, again, obviously, a very difficult year to compare the results this year to last year, quite a few moving parts. So I thought I'll just touch on some of them to assist in trying to understand the numbers a bit better. It's the first one. We all know about the impact of COVID last year, where all our stores were closed for at least 5 weeks. We lost at least ZAR 5 billion in revenue during that period, but we also had a lower expense base, because we didn't pay full rentals during that periods. You've got to take that into account when you look at the expense growth and also the top line growth for this year. We obviously had the civil unrest in July. As Leon mentioned, we lost ZAR 816 million in net sales during that period, and I will also unpack the impact of the insurance and where we are on the process and what we've received and the claims that we've had to submit to both SASRIA and Emerald for that period that we were closed. So the impact and also still for the losses that we've incurred going forward. The Building Company, as we communicated, still in the 6-month result. We were in the process of selling it to cash. As you all know that deal didn't go through. So it was disclosed previously as a discontinued operation. Now it's shown again as a continuing operation. So last year's numbers had to be restated to account for that. We're now comparing the numbers, including The Building Company last year. Then quite a big impact for us this year is the impact of IFRS 16. We obviously closed quite a few stores. John Craig was partially sold and closed. Africa, we also closed some stores. And then we also have continued with the trend we've seen over the last 2 years of much improved rental agreements with almost all our landlords. That meant we've got a lease modification this year of ZAR 638 million. This is not a one-off event. We do anticipate to see again a lease modification in the new financial year, but obviously, at a lower number. It won't be to the same extent and the same impact we saw this year. It will definitely be at a lower quantum than what you saw, the ZAR 638 million. Where we did have a one-off impact on lease modification was the acquisition of 11 properties when the process is actually 12 properties that we're acquiring. 11 of those already went through before year-end. And the lease modification impact of that is ZAR 265 million. That is a one-off impact. And I'll also show the impact of that on HEPS if you exclude that later on in the presentation. So to unpack 2 of those items, as I said, on the one we get, obviously, the most questions on, what was the impact on the profitability of the group. The insurance claim, where we're in the process. So just again to confirm, as you can see on the right-hand side. On SASRIA, we've got total cover of ZAR 1.5 billion. We've got this primary cover ZAR 500 million, but we've also got the top of cover of ZAR 1 billion. Emerald per incident on business interruption, we've got cover of ZAR 750 million. The only component in this year's results is not really covered by insurance, we had incurred some additional security costs and still incurring some of that to secure specifically our DCs during that period, and that is still ongoing. But if you look at the quantum of the claims, so we have submitted both to SASRIA and Emerald, obviously, our full claim and the loss adjusters are working through the process of making sure we get the final payments. So on the SASRIA, the total value of the claim is ZAR 1.2 billion. That includes, again, to confirm inventory write-offs, fixtures and fittings, to reinstate the fixtures and fittings that we've lost. So that's not the write-off value. It's the reinstatement value, and then also cash losses that we've incurred during this period. On the business interruption side, the ZAR 717 million, that really kicks in after your stores closed for 7 days. And it runs for a maximum period of 18 months, the losses in sales at GP that you would incur during a period. So very happy to report on both of those. We've received interim payments already, and that's included in our results. So from SASRIA, we received 2 payments totaling ZAR 500 million during the period. And then on the Emerald side, we received our first interim payment of ZAR 171 million. The rest of the SASRIA we're obviously working on. We anticipate to get that in the new financial year. And on the business interruption, that obviously gets submitted on a quarterly basis. As stores open, we obviously do those calculations. So that will be received every quarter during this new financial year, the rest of the amount outstanding. The second item, as I said, that's really a one-off occurrence that had a major impact on the results this year is the acquisition of 12 properties from Steinhoff, 11 of those have already been transferred before year-end. A total amount of 70 million shares will be issued for that. And again, 69 million of those shares was already issued just before year-end. So that's already accounted for. The net impact of that is, as I mentioned, the ZAR 265 million lease modification. That's pretax. After tax, it's at ZAR 191 million. So from a HEPS perspective, that's a ZAR 0.502 HEPS impact. So if you exclude that, our result on a more continuing basis, a sustainable basis would be ZAR 1.50 in HEPS for this financial year, and it is disclosed as a pro forma in the results that were set up. So again, just to break down the revenue growth, as I mentioned earlier, as I mentioned, also phenomenal growth from all segments and all companies, Clothing and General Merchandise at 8%, PEP and Ackermans and Specialty really performing, all of them very well. But you've got to take into account in that, it still includes John Craig numbers. Obviously, that is a negative impact. Tenacity also has got a negative impact that's in that number. And then obviously, also Africa, when you translate it back to actual rates, because of the weakening of the currencies in those countries, had a negative growth. As I mentioned, on a constant rate, it was a positive growth. JD really one of our star performers. Merchandise itself growing at closer to 17%, 18%. But the book in the JD as I also mentioned earlier also showing a negative growth, remains the reason we ended up with 14%. The Building Company, as I said, really performed very well, where people seem to be spending a lot more on refurbishments and renovations this year. So phenomenal growth of close to 18%. And on the Fintech side, it's sort of 2 stories where on the FLASH side, we still continue to see good revenue growth. But on the Capfin side, as I mentioned earlier, obviously, a negative growth on revenue, because of the cutback on the book and the lower interest rate, meaning 3%. But overall, still the 9.2%. And as Leon mentioned, if we exclude those 3 books, it's 10.3%. And if you include the ZAR 816 million, the overall growth for this year would have been above the 11%. Very happy still to report that cash sales was at 10.6%. And again, to confirm 93% of the group sales is done via cash. And also, again, to confirm Clothing and General Merchandise is still the bigger part of the business from a revenue perspective, making up 64%, but very nice contribution from all the other segments this year. Just to unpack the GP percentage a bit further. As I said earlier, improving from the 34.2% last year to 34.3%, really impacting by the 3 different events. As I said, the civil unrest had a 20 basis points. And just taking into account we had to write off ZAR 673 million worth of merchandise after the civil unrest, that goes through the GP line. However, as I mentioned, we did recover the ZAR 500 million for SASRIA. So that's offset against that number. So that 20 basis points is actually ZAR 173 million impact on the GP line. As I mentioned, very happy to report that on the Merchandise side sales, we saw a 40 basis points improvement. I already reported that in the 6 months period. That's continued. However, again, if you exclude the civil unrest, that number would have been even higher. But then on the downside with the cutback on the books and the low interest rate that had a 30 basis point drop. However, it is important to take notice, over the last 5 years since this being our average GP, percentage has been 54.6%. And that's where we still think long term, we should be around the 34.6%, 34.5%, because as we've previously reported, from an inflow GP perspective, we don't change that on a year-by-year basis. The only impact on our GP would really be the amount of markdowns and discounts we process during the year. Other Income. Obviously, in Other Income, we've got the anomaly this year of the ZAR 171 million received from Emerald for the insurance. So if you include that, it's a 40% growth, ZAR 1.1 billion. If you exclude it, it's a 17.3% growth, mostly driven by commissions, we received for bill payments, DStv payments, money transfers, et cetera. And we did see quite a significant recovery this year on those where people definitely start to return a lot more to stores to do bill payments and money transfer. Last year, we saw after COVID people tended to not use stores to do those payments. They did it over the Internet. So very happy on that. Insurance. We also had a nice growth. That's mainly the amount we received from the JV from Hollard. And then in other, we had quite a few items, but obviously, the new one that we had in there, we sold some of the old books in the market, and we've recovered quite a bit of money from that, and that's included in other. Cost of doing business. As I mentioned, we're getting back to a more normalized cost of doing business. Last year with the drop in revenue even after striving our best to take out some of the costs that we could during that period, we still had a high expense base. So very happy to report we're getting back to more normalized cost of doing business at 24.4%. You'll see there the overall expense growth, if you include depreciation now versus 8.2%, I showed you earlier, is 7.2% and also excluding that one-off gain of ZAR 265 million, it's a 7.2%. Depreciation is down on last year. If you look at the depreciation component, specifically relating to IFRS 16, that is exactly the same level as last year. But because we have spent a lower amount of CapEx, specifically on store CapEx, through the last 2 years than what we've done previously, our overall depreciation charge has come down for this year. So as I said, very happy to report. On the salary side, we did see a sharp increase of 15% compared to last year. There, you've got to take into account last year, we obviously had the TERS amounts, and we paid very little or no bonuses and incentive last year. This year, we're obviously very happy to report that we were able, because of the fantastic performance of the individual divisions and company to pay almost full bonuses across most of the businesses. So if you exclude the impact of those 2, the real salary cost would have been just over a 5% growth. And then also happy to report on the property cost. We're still doing good work and the property team doing very good work, still have a drop in rentals on renewals, as you would have seen in the lease modification. Although the percentage is now 4.1% versus the first 6 months of the year where it was negative, and that's again just because of the lockdown period in April and May where we didn't pay full rental. So it's basically just a lower base giving you that 4.1% increase in rentals. Operating profit, I said earlier, very good news, again, to see that all our segments have really done fantastic performance during the year. PEP and Ackermans, Specialty, as I said, again, performing very well. Again, in this -- in the Clothing and General Merchandise segment, you've got to understand that John Craig is still in that number, which obviously had a loss this year of the sale and closure of that business, which does impact that number. Besides from that, all the other; Tenacity, Africa, all the other businesses showed either small or a significant profit growth. JD as mentioned, one of our star performance, all the businesses, they're also doing very well, specifically Hi-Fi and Incredible. But the book also returned to profitability. Hence the reason also the overall segment, where last year, we made a small loss, showed a significant profit this year. Then The Building Company, as I mentioned earlier, now back into continuing operations. It is amazing what happens when you tell a business you're going to sell them, they suddenly start to perform. So a really fantastic performance and improvement in all the indicators on The Building Company side, very good cost control, improvement in GP and obviously good top line growth, giving us that result. And on the Fintech side that I said earlier the year, again, although Capfin on top line side didn't do so well, had a negative growth. From the bottom line growth, very nice improvement on last year. A lot of expenses taking out there, creating a lot of efficiency in that business and then also with the lower debtors costs ensured that we had a nice profit in Capfin, and FLASH continued to go from strength to strength and again showed a double-digit profit growth during the year, giving you the overall 39.9% growth. Just again to take note of on a pro forma basis, before the impact of IFRS 16, we've got a compounded growth of 15.5% growth over the 5 years on operating profit. And as Leon also mentioned earlier, very happy to report that we've exceeded our 2019 profit on an OP level that we achieved that year. Impact still, the majority of our profits still come from Clothing and General Merchandise. We saw 64% of the revenue, but 84% of the profit. So -- but again, very nice to see we're seeing good, consistent contributions now from all the other segments. And our operating profit has again almost returned to normal level back to the 12% after the drop we saw last year down to 9.4%. Finance cost, very happy to report that there's significant reduction in debt. The lower interest rate. We also did refinancing during the year, which I'll unpack later, on 2 of our term loans at better interest rates, which meant that overall, we saw a drop of almost 32% in finance costs. If you look at specifically the component that we pay to banks and bondholders, that's down by more than ZAR 700 million or a drop of 52% down to the ZAR 660 million that we paid this year. Tax, also much more effective rate this year, effective tax rate at the lowest level it's been since listing. A lot of that to do with the fact that we settled all the pref shares towards the end of the previous financial year and the beginning of this year. So that obviously wasn't effective from a tax perspective. And then also with the fantastic performances this year from almost all the divisions, we could utilize a lot more of the unrecognized tax losses, which we were able to do in the previous year. So very happy to report the 31%, and there's probably still a bit of an upside in that in new year. Inventory levels, there was a lot of concern at the end of last year around our inventory levels dropping down to ZAR 12 billion. Because during COVID, we canceled quite a few orders. And then after COVID, we had fantastic sales with the pent-up demand, so we ended up much lower than we would have liked. As I communicated at that stage during the year, we do anticipate that our inventory level should get back to 2019 levels. We didn't quite end up there, and that's just to do with the current situation around the supply chain with some deliveries were still late t's year-end. We have seen post year-end that some of those lags have now been received and we're a much better inventory perspective after the year-end than what we were at year-end. Books. As I mentioned earlier, the strategy was still during the year to cut back on credit granting, across really all 3 of the books. Tenacity to a lesser extent. Tenacity still saw a growth of ZAR 100 million, increasing from ZAR 3 billion to ZAR 3.1 billion, because we were still a little bit more lenient on Tenacity on credit granting. We have specifically the Connect or the JD book only giving to our very good customers, granting credit. And on Capfin, although we've got more customers in Capfin at the moment, up to 240,000 accounts, the term of the loans are a lot shorter, going back more to 6 months alone. So it's a shorter term, lower value, hence the reason that the gross value of the Capfin book didn't increase. However, also happy to report that as we've seen during the first 6 months of the year, our collections are still looking very good. As a result, our nonperforming loans across all 3 of these books have dropped compared to last year, which meant that we could release some of the provisions that we raised with the concern at the end of the previous financial year, released quite a bit of those provisions, and that played out specifically in the Connect book and in the Capfin book, as you can see there. Again, the message is 93% of our sales is done via cash. Only 7% of our sales is done via the books, and that's predominantly done by Tenacity and Connect. Remember, Capfin is not a sales enabler. It's a service we give to our customers. So on the debtors cost. As I mentioned, last year, the total charge to the income statement was ZAR 1.7 billion. This year, it's a ZAR 785 million, so a drop of close to 55%. And it's really through the movement into provision, the physical bad debts that we wrote off this year is exactly the same amount that we wrote off last year. But last year, we significantly increased our provisions because of the uncertainty around COVID and the impact of that on the economy and on our customers. As you will see there, with the very good collections, the drop in nonperforming loans, we were able to release 300 -- almost ZAR 360 million in provisions this year, which needless to say, impacted the income statement. Cash generation, as I mentioned earlier, is still very good. Net working capital, you see a slight increase there of ZAR 2 billion. We did, as I said earlier, anticipate that number actually to be higher. But because of inventory still at a slightly lower level, also the fact that we have not really grown our credit books, as I mentioned earlier, maintaining at the same level, only an outflow of ZAR 1.5 billion, meant that we could generate the ZAR 11 billion in operating cash or 84% cash conversion rate. Net debt, as I mentioned earlier, phenomenal drop over the last 2 years. 2 years ago, we were close to ZAR 14 billion on net debt, last year came down to ZAR 7 million, now ZAR 5 million. That's obviously due to that very good cash conversion that I just showed you last year. And this year, we're happy to say our net debt to EBITDA is now at 0.6x. Where 2 years ago, we're still close to 2x. And we went through a process with 2 refinancing activities during the year. The one was the issue of bonds of ZAR 2.2 billion of it, at much better rates than what we had previously. And we also refinanced term loan C also at much better rates previously. And you'll see that obviously now the repayment profile is spread over a 3- to 5-year period. We're also in the process of refinancing ZAR 5 billion of the ZAR 5.8 billion that's repayable in 2023. And again, very comfortable that we'll come in with much better interest rates. And also, again, repayment profile will be spread over a 3-, 4- and 5-year period, making sure that we don't have these huge payments in 1 year. Capital expenditure, significantly up this year. We did call it the more continuing CapEx, ongoing CapEx, the ZAR 1.4 billion, we did cut back last year. That's normal CapEx for store expansion and other investments, but we had a couple of unbudgeted, unplanned CapEx investments this year. Top of the list, needless to say, was the investment we had to now make in rebuilding a lot of those stores, ZAR 103 million spend this year. There will obviously still another amount come through in the new financial year as we're still in the process of reopening all the stores. The acquisition of those 11 properties that I mentioned earlier, just over ZAR 1 billion spend on that. And then as I communicated last year in the process of developing the PEP Hammarsdale DC, and we incurred close to ZAR 340 million on that. There will probably be another ZAR 400 million we'll spend on that in the new year. But our normal store openings, IT investments, we did cut back and only spent the ZAR 1.4 billion. We do anticipate that next year we'll obviously return to more normalized levels. As Leon mentioned, we'll return to opening more than 300 stores. We still got the investment in the completion of the PEP and Hammarsdale DC and also the fit-out of that. So we do anticipate where this year ended up at 1.8% of revenue, will get closer to a 2.2%, 2.3% of revenue in the new financial year on that component. So on share buybacks, as I also communicated at the 6-month results, we looked at buying back ZAR 1 billion of shares in the market. So we did, during the end of September, buyback total shares of -- to the amount of 38 million or ZAR 760 million at, very happy to say, an average price of ZAR 19.99, so that's been very successful for us. And just to confirm again, from a capital allocation process for the new year, our focus is still on growth and expansion, opening more than 300 stores, completing the fit-out and the build of the PEP Hammarsdale DC. We're still investigating a few options around possible mergers and acquisitions. Although we haven't spent a full ZAR 1 billion on the share buybacks. We'll still where it is at the appropriate price further, again, look at share buybacks in the new year. And then obviously, we will, if -- review the dividend policy again towards the end of the new year, but very happy with the 3x cover that we reported in this last financial year. That's my story. So I'll hand back to Leon. Thank you.

I'll take you through the 4 segments of the business and have a quick chat about each of the different brands and how they're performing and what the prospects are for each. Before I start that on the Clothing and General Merchandise, just 2 points I want to highlight. We've been speaking for a year -- longer than a year about the sourcing office in Shanghai, that used to be part of Pepkor Europe that we'll want to strip out of there and run as our own office. That process has now been completed. Since the first of October, the sourcing office there is called PPS, Pepkor Product Solutions, have run on their own, and we're quite proud to say that they are totally under our own control. And very proud to say that the process to convert or to transition into our own office has run completely seamless. The office consists of about 80 people. Most of the 80 people are people that have been working on our account for many, many years in the previous office. We've just taken that people over to the new office. The manufacturing capabilities and manufacturers that used to produce for us are still the same manufacturers. So very little change, except for systems being independent, requires you to build a bit of shared support infrastructure that we've done already, but very happy to say that the office is up and running seamlessly and had no real impact on the business at all. In terms of Pepkor interoperability, it's a difficult word for me to say. I mean, that's all about how you use the data in your business and in Pepkor, obviously, as in most businesses, the use of data has become more important and we've expanded and invested in building the data capacity and how we use it and how we -- and how we use the information in the group, we've expanded a lot on that. Now if you take into account that we've got in our business more than 27 million unique ID numbers or identifications for people that just shows you, gives you an idea of the size of our data. And then we also know that 14 million of them have used or use more than 1 brand in the business and interact with one or more than one entity of the business. It just shows you the amount of data that we sit with and the importance of using that data in the future. Now all of the businesses in Pepkor, except for the PEP store brand, when I speak here, I speak for CFH, which is The Clothing and General Merchandise, all of them are interoperable. So you can -- if you have a card at -- a store card at Ackermans, you can buy at any of the other brands and vice versa. And that's something that we've built up, and it's important for us to have the information that is shared across the group, because that helps you with the total Pepkor retention and acquisition of customers over time. And obviously, that's the whole point of using the data. And building those customer profiles are extremely important across the brands. As I mentioned, the only business that was not included so far in that interoperability has been PEP stores. And we've decided that from the first of October -- or we decided this a while ago, but from the first of October, effectively PEP stores are also now part of that ecosystem, so to speak. In other words, if you have a card at Ackermans, you can now also buy at PEP and that applies through all the brands in the Pepkor Group. So I think that will make a significant difference from a PEP point of view, they -- so someone can now open a card or get a card for credit at PEP stores. I don't think the take-up -- I'll talk about it a little bit later. The take-up won't be so big. But I think the fact that we get the benefits of data and other benefits across the group, I think, is a very positive strategy for the future. A number that the analysts always want us to share is the PEP and Ackermans combined number. And I'll just run through how they performed on just the 2 businesses combined. You can see there from a sales growth point of view, 9.5% growth in sales, which I think is a fantastic number. Just an important, if you look at the bubble there, that's compared to the 2019 year. There's been a 12.5% growth. That's now year '21 on year '19. And the reason we give that number is it's so difficult to compare with bases that were influenced in the previous year. All sort of things like the unrest and looting impacting on figures, the closure during lockdown, that impact on figures. So all those changes or impacts or influences make it very difficult to compare. And we still feel that comparing to 2019 gives you a good sort of -- a good comparison to look at what your real growth was. If you take into account that over the last 2 years, the size of the market has actually shrunk, the initial year of COVID shrunk by 4%, then another 2% this year, then that number is actually quite remarkable for businesses, the size of PEP and Ackermans. Like-for-like sales, 7.5%, as you can see there. We still opened 175 new stores. It was a call that we made, as I mentioned earlier, right at the beginning of the COVID uncertainty that we are prepared to further invest or keep on investing in these 2 brands because of their strength and also because of the robustness of their profitability models. And it's paid off for us. And even during the uncertain times, you can see that the new stores have worked well. In terms of space growth, that means a 3.1% increase in the last year. A question I often get is on the inflation and what is the inflation in these businesses. You can see 5.5% on CFH. That's the selling price inflation that we have. And then in growth in trading densities, because we always watch that to make sure that we don't cannibalize too much with our new business, you can see there over the last 5 years, an annual increase in trading densities of almost 5%, which is something that we are particularly pleased with. If you look at the PEP brand in -- on its own. Important to note that they're in a very difficult part of the market at the moment. Yes, I mean, people always say that people trade down and that is true. But then one must also remember that there are consumers at the bottom end of the market that exit the market, the formal market almost completely. And that's the cause of unemployment. And if you look at the unemployment number, which has risen dramatically over the last year or so, then that's -- many of those people are the ones that shop at PEP. But PEP can be very proud of their performance last year and the profitability that -- growth in profitability that they showed, it's a very rewarding year for the, as I call it, the dynamos of PEP that performed really well despite the challenging conditions there at the lower end of the market. And part of that success is obviously the fact that they're keeping their price positioning where it's always been, despite the fact that there's more competition coming into the market. So in terms of best prices or best price leadership, as they call it, still 97% of the products that they sell in their stores are equal to or cheaper than anything else in the market. And that's a remarkable number in the retail terms in the world. And then something very special about PEP. This year as there is every year, there is what they call Ask Africa Orange Index. Ask Africa is a research company. And on an annual basis, they measure through research, customer experiences. They do it across all major businesses in South Africa. So it's literally hundreds of businesses and they look at different sectors of the economy, be it retail, banking, investments, whatever the case may be. This year, PEP won the award as the Best Customer Experience Business in South Africa in any sector, in all sectors. So that's a remarkable achievement. It's the third time that PEP has achieved it. And yes, as I said, I just think it's very special. And it just shows you that even at any level of the market, customer experience is important and even more so at the bottom end of the market. So congratulations to the guys there at PEP. As I said, it's the third time that they've achieved it. What is remarkable about the culture of the business in PEP is that they've achieved that without having one formal training program for customer service, but that they rely on the way they treat the people in the business and that, that will transform into how the shop assistants will treat their customers. So well done on that. PEP Home has been a great success. You can see the growth there, 31.2%. They're up to almost 300 stores now. PEP Home is built almost like a cult following on social media, where people go to PEP Home and just marvel at the prices that they get there compared to a lot of the other home retailers. And that business is growing well. Again for next year planning, in the region of about 40 and even slightly more new store openings for PEP Home. PEP Home brand very much in demand with landlords. So yes, a great success story. It didn't come overnight. PEP Home has been in existence for 12 or so years, and it took a while to get going, but I think we've got the model from -- both from a range and a profitability perspective, we've got that model right now. In the last year, again, I mentioned it earlier, still great store openings in the PEP brand, 124 new stores. That obviously includes PEP as well as PEP Home as well as PEP. So that's a combination of that. A great success has been PAXI, parcel in a taxi. I've spoken about this before, still running in the region of about 10,000 parcels per day that they put through their system, which is unbelievable. It is -- they've expanded the locations or number of locations that you can use to 2,800 now. So that's all the PEP locations plus Tekkie Town plus Shoe City. So all of those locations can be used to send or receive parcels. And it's just been a great success and a lot of opportunity in the future to still expand and build on the -- on this great model. And then the DC, Riaan mentioned the DC that we're building in Hammarsdale on track. 142,000 square meters just shows you the size of the business. This will be just 1 of 3 DCs in the PEP infrastructure, but that's on track and building for the future. And the last one there is just the PEP Card or the interoperability card that I spoke about earlier. That's the PEP rolling sort of store card. They've started in October, very slow. We don't expect a huge take-up. The reason for the card is more towards the data analysis and data usage than it is to try and build a credit book here. We don't believe the book even in the longer term, will become very big. Customers in Pepkor can only have 1 card. So Ackermans customer card now also have a PEP card. And obviously, the same principles that we use for the Ackermans card and the same credit criteria that we use for the Ackermans card will be applied in the case of the PEP card. Ackermans has been the best or fastest-growing retailer in the retail industry over the last 10 years by a considerable distance and absolutely great company, that's really delivering on the customer value proposition in a very special way. And the last year has again been a very successful one for them. And remember, that base is very high by now. Really making a big impact in that middle end of the market. And I think collecting a lot of the people that are shopping down towards in their sort of the areas where they dominate, which is in kids and baby clothing. They opened a new -- 51 new stores during the year, which, again, there's still a lot of potential for growth in this brand, which makes one exciting about it, up to about 900 stores now and -- but watch the space, it will keep on growing into the future. It's also now become a really substantial player as far as handsets are concerned. That's mobile handsets, 18% growth there. It's become quite a big business there. The average handset that they sell in the business is of the value of just over ZAR 900. So it's a bit of a different market to PEP, higher -- a bit of a higher LSM market than a higher phone or handset market. So we see a lot of that is complementary to what we already sell in PEP, which is high. But the guys they have done a great job in making their offer to the customer unique and special. And then in part of our strategy of improving our market share in adult wear, we've started the -- or Ackermans has started, Ackermans Woman, we've spoken about it before. Just again, that brand or that little chain, and there are 35 of them now, have been successful or profitable from day 1, which is remarkable as it is. And a lot of time and effort is spent into getting the model right and getting the recipe right. And I'm quite excited about the rollout plans that they have for Ackermans Woman into the future. And for next year, that's -- they're looking at -- in the region of about 30 stores, which is a substantial increase and very excited about that expansion. The number that you can see there is 14.5%, that's the growth in women overall. That includes the stand-alone stores as well as the women's department in stores. And that's a remarkable number. I think that comes from a number last year, which was also in the region of about 15%, 16%. So great growth there and really in line with our strategy. Credit sales, 18% this year, was 17% last year. So very much in line. Lay-by sales, which is also a big contributor to the sales in Ackermans running at the same levels as always. So very good for Ackermans. And if the layby sales are good, obviously, it projects well for sales going forward. Click and Collect is something that's quite exciting in the life of Ackermans, and that's also something. Another thing, that's the third thing that I've mentioned now that started in October. Click and Collect means basically the e-commerce model that Ackermans has, which is you can order online and, that order is then delivered to any Ackermans store or any chosen Ackermans store. I think that's a very exciting development for Ackermans because -- to use an example, the customer in Pofadder can now order what is available in East Gate. So the full range will be online. And the smaller stores that doesn't have that line or that people that live in towns where that range is not available, can now order from the full range of the business, which is a very exciting prospect for our customers in the smaller towns. So it's Click and Collect, so it's very much aligned to the distribution network that Ackermans already has, which reduces the costs again. I'm very excited about what we can achieve there over time, and it will take time for customers to sort of adapt to it. PEP Africa. Africa has again had a very tough year and mainly because of local currencies. If you look at the sales growth in the business, you can see it's 9.2%. And on a like-for-like basis, 13% growth in constant currencies. But unfortunately, the local currencies haven't been strong. commodity prices haven't supported them in all of those countries and therefore, 12.6% drop in the actual currency or actual sales growth that we experienced, unfortunately. But the team have worked on consolidating the business and building a more robust business. And they've done a fantastic job in achieving that. They've reduced the cost base in the business by 20%. A lot of that due to rentals. They've consolidated the store network, closed, you can see their 19 stores in the period. So a lot of that hard consolidation work taking place and the unit or PEP Africa even made a small profit for the year. It was helped a bit by IFRS 16, but nevertheless, made a small profit. And that we're particularly proud of. We've been in Africa since 1995. That's our PEP Africa. And since then, proud of the performance and proud of the growth that the team have achieved. Last year -- few years have been difficult, but we've seen before how quickly this can change as cycles change with commodity prices, et cetera, in countries. Specialty. This is our sort of driving spear to improve our adult wear market shares. Again, you can see there that the sales growth has been fantastic, 13.6%. If you compare it to 2019, 9.4%, but then you must take into account that you must exclude John Craig from that number. And then that number will be considerably higher. John Craig was the disposal that Riaan also referred to. The like-for-like sales growth, 11%, which is under these current circumstances, really, really good. They're up to 837 stores. So -- although this is regarded as a small part of the Pepkor Group, it's not so small anymore, and you can see it from the number of stores, but also the profitability is becoming more and more meaningful in the bigger group. All the brands are now online. It's not that they're shooting the lights out. They're operating at about 1% of turnover. But for something that's relatively new and remember that Specialty is still mostly in the value sector of the economy, then the progress that the team has made on the online and e-commerce platforms has been very, very good. And we're quite satisfied with the progress or with what they've achieved so far. A very special number, one special number or one number that I would like to highlight, and you can see there, 231 basis points. That's the market share gain in branded footwear, and that's obviously the Tekkie Town brand that I think is a really special number considering the competition in the market and the environment and really had a good year again on the previous year, which was also a good one. So the Tekkie Town team really coming to the floor and producing very good sales and also very good profitability. Despite some challenges, especially on the supply chain side where branded product has been in high demand or less -- too low supply over the last year or 2, but very, very good performance. Refinery. Refinery, hopefully, many of you know the brand. We've spoken about it before. It's just still growing, and it's so accepted by the consumer in general in South Africa very much in the shopping centers and going from strength to strength and both from a revenue as well as a profitability point of view. And yes, that's become a household name in South Africa and a lot of potential still in that brand. Shoe City has been the 1 brand where we've battled a bit in the last year. But despite that, they managed the business very well in terms of the profitability and by making sure that there are no unnecessary costs in the business, et cetera. As you can imagine, a business like that was very much affected by the fact that there's no school or school clothing went down, and they sell a lot of school shoes. They're mostly in big shopping centers, which haven't performed as well as the rest of the market, et cetera. But the guys there have changed -- not changed strategy, have adapted their strategy, looking more at the casualization of the school range that they sell. That's been proving to be very successful. So there are very positive signs for the future. But the one brand where we didn't perform as well as the rest. Dunns, I reported last year that Dunns had their first profit in something like 12 years, and I can tell you they've really built on that into making a much more profitable business than it was even last year. So very satisfied on the progress there. They've changed a lot of aspects of the brand, made it more contemporary, a bit of a younger customer that they are aiming at than we did in the past. And it's really worked for them, and the numbers are showing it. So very happy with the progress there. Code is a new business that we bought a while ago, about a year ago. We're consolidating the business at the moment, building the infrastructure, making sure that we have a platform to expand from. And then once that is ready, then our plan is to run Code stores out -- at quite a quick pace. But a lot of potential in the brand. The brand is very powerful. Although it's relatively small, it's got 20 stores. There's a lot of equity in the brand already and really, really positive and exciting to look at that for the future. SPCC, a bit of a premium brand, not really our DNA, but it's been doing quite well and holds its own and is just -- is on the profitability line, with a lot of potential, and with a little investment, we believe we can grow the brand into something that is worthwhile for the group. So that's the Specialty group. And The Clothing and Footwear home section and General Merchandise. So a very good performance from them. On the furniture side, the furniture business, JD Group was really impacted by COVID, and we were all hoping that they would rebound and that they did indeed. This is just the tech side of the JD Group, which is Hi-Fi Corp and Incredible Connection. And you can see there 128 stores, not a huge increase in the number of stores, but they've done great work in firstly revamping some stores. Secondly, reducing some stores and thirdly, relocating some of their stores to better locations. And that's helped a lot in them growing their business or the sales in their business by more than 20%, which I think is a fantastic achievement. And they've really capitalized on the market requirements or the needs of the market with working from home, et cetera. But a great reactive or reaction or sort of proactive reaction to the market demand and a very good performance by the business. I've reported on this before, but 7%. It's always between 7% and 8% of the turnover in this particular segment, is online. I say segment, it's the tech division of Hi-Fi Corp and Incredible Connection, which is almost a bit of a center of excellence for us in the group. And I think even in South Africa, that's quite a high portion of e-commerce sales for a specific business. Everyshop is something that they launched in the last year, and that's quite exciting. Everyshop is basically your online marketplace. It's been -- we're quite happy with the take-up so far. We're managing it to grow it slowly, which was the intention so that we can learn how to satisfy customer demand, how to fulfill in time and to do it at a cost that is affordable, not only for us but also for our consumers. And -- but generally, the tech division of the JD Group has really performed well and can be very satisfied with the profits that they achieved during the past year. Then also on the Ask Africa Orange Index. Remember, I mentioned earlier that there are different categories or sectors that they measure. And in the appliance section or electrical appliance section, the Hi-Fi Corporation was the winner of that sector of customer experience. So congratulations also to the team there. And well, it's great to see so many of the group's brands doing well in customer experience and fulfillment. The Home division. The Home division, just to remind you, Russells, Bradlows, Sleepmasters and Rochester, also done exceptionally well during the past year. Important to look at this slide is the 17%, which is the credit contribution. That credit contribution at one stage was very, very high. We -- the team there brought it down to about 30%, and then it went down to about 27% or roundabout there. Obviously, we went more conservative with credit when COVID broke, because of the uncertainty. That credit contribution now down to 17%. But to achieve double-digit gross sales growth and only do 17% on credit. I think that's really remarkable. Lay-by did help. You can see the 19% lay-by contribution there. That's really very high. And if somebody asked me that 5 years ago, I would have said that it's not possible, but a great job there done by the team to promote the lay-bys, and that's really helped to keep the turnover growth or to create turnover growth. All the brands here are profitable. A few years ago, as you -- most of you know, we couldn't say that. So that's really positive. So yes, it's the business is generally in good condition and again, a lot of opportunity for growth into the future. To come back to the Ask Africa Orange Index, there was also a winner here in The Furniture category, Bradlows was the business that provided the best customer experience in South Africa, our furniture businesses. So that's a special achievement for the team there. Building Materials. As Riaan spoke about, the Building Materials business and Competition Commission not approving our disposal of it, which, in retrospect, we're quite happy with. The business did exceptionally well in the last year, both from a turnover and a profit point of view. Like-for-like sales growth, you can see there more than 20%. The base of the previous year was relatively low. These businesses, like the building supply businesses, had a longer lockdown period than the rest or the -- than clothing businesses did. But you can see still a positive growth in the 2019 number. Despite the fact that the business was in a sort of a disposal phase for a while, we never stopped building the business, developing the business and the team there have done a great job in consolidating the business. It was an accumulation of loose pieces for a long time. Now it's a much more focused business. And really a great job done by everyone. And I'm so happy to see or to say that the results are proof of that. As I said, from a profitability point of view, it's really made a huge improvement on the year before. And if I look at the potential in the business, then a lot of that is still to come. The store number is not really increasing. Rather, here and there, there might be a store that might decrease by 1 or 2 stores. What the guys have done there is COVID has led to that, has forced them to take very quick and meaningful action on the cost base, and they've brought that down by 10% just in the last year. But if you look at, for instance, the budget that we have for the business in 2022 that is on par with the budget for costs that the business had in 2019, which is also quite remarkable. So they've become much more efficient and that's all part of the consolidation exercise that have made them so successful. So operating growth was fantastic. Another thing that's changing in this business is that the focus is now changing from consolidation to growth and developing the business. And that's from a mindset point of view and a future point of view, really a positive thing to be able to say and I think in the business that will have positive results as well. The Fintech environment. First business there that we always talk about is FLASH, and FLASH has kept up the successful track record that they've had for a long time now. Still handsomely over performing the double-digit mark. And the team has really done exceptionally well to keep the expansion going there as they have. The number of traders are up to 203,000. But like I always say, it's not only about how many traders you have, but also about the quality of the traders that you have in your business. And you can see that the growth in turnover per device or turnover per trade has gone up by 23.5%, which is testimony to exactly that. Some of the numbers in this business is actually quite remarkable in terms of just the pure volume that goes through there and a 6.5 million daily transactions for this business. And a lot of effort in the business goes into how do we build an infrastructure that can cope with that, that is secure, et cetera, et cetera. So the team have done well, building the business from entrepreneurial business into one that can and will become a really big business in future, hopefully. So a lot of that sort of developmental stuff happening in the business. 1Foryou is something that I mentioned at the 6-month results, 1ForYou is a voucher that you can buy and it basically digitizes cash for you. We think it's a big benefit for our customers. Many of our customers don't have credit cards, which prevents them from buying online, but with a -- 1ForYou voucher enables you to do that. And we sell 16 million of those vouchers a month already. So great development by the team and lots and lots of opportunities for growth on that in the future. Growth in cellular spend here, you can see again that's increased significantly by 21.6%. And then from the team's strategic point of view, a lot of effort, time, focus goes into building an ecosystem for the future, which is not so dependent only on airtime and electricity and some of the bill payments. And yes, as I said, a lot of focus going into it and great progress made over the last few years in building an ecosystem for the customer and their demands, not today but maybe in a year or 2 or 3 from now. The Capfin business, we've been conservative in credit granting. You would have seen the gross book has stayed the same size as the previous year. But the nature of the loans that we have provided has changed. 75% of our loans are now 6-month loans. 6-month loans, less risky than longer loans. So we're quite happy with that change and the trend that it's taken. We've got more than 240,000 Capfin loans now, and that's really quite special. So despite the fact that we've been conservative, despite the fact that we've consolidated the business, the sort of KPIs of the business are very positive. We are at pre-COVID collection levels, which is extremely positive from our point of view. That was one of the areas where we had the most uncertainty initially, but that's looking good. The cost base has been consolidated. The team there have done again a fantastic job consolidating basically Tenacity. A lot of the Tenacity leadership and Capfin leadership has been consolidated, which has caused us to bring that cost base down by almost 26%. So really, really good work being done there and a very profitable business in the past year. Just before we finish off just a short look at what's to come in the future. We look at the operating environment. Now this is normally what I call the weather report, where you have all the excuses, but this is the reality today, I guess. COVID-19 is still with us. I think from a store opening point of view, I don't think that will affect us a lot in future. COVID-19 really affects us when it comes to what it does in terms of the economy and economic growth and unemployment. And we hope that the -- all sectors of the economy will open up as quickly as possible, and that if they fire on all cylinders, then it will help our business and all our businesses and the country as a whole in future. So suffice it's not about -- the concern about stores closing. It's more about the economy. And hopefully, hopefully, we'll see positive signs there materializing very soon. I still don't think that the economic impact of COVID-19 has played out in total. I think we're still going to feel the worst of it. If you look at the unemployment number, 2 years ago, that number was at about 26%. Now it's at 34%. So somewhere and somehow that has to play out in the economy, and it has to play out, unfortunately, in all sectors of the economy. So hopefully, we can get the economy recharge as quickly as possible to counter that. Another area where a business like PEP, especially loses is the informal economy and informal events or people that are working at events. So there are no soccer games and there are no rugby games and there are no theater productions. A lot of people are out of the economy, and they're not counted into that unemployment sector. So hopefully, events, et cetera, will be resumed as soon as possible with the spectators, so -- as an example, so that we can get all parts of the economy active again. Government grants have supported us. While a lot of the -- a big part of the economy has suffered so the ZAR 350 grants or additional grants have been, as far as I understand, has been approved until March next year. We're not too sure what's going to happen in the grant environment after that. But I think most of us realize that in South Africa, that's going to be -- that's going to have to remain a part of our economy and an important part at that and probably likely to grow in the future. Civil unrest, hoping that, that won't be something that we have to worry about. But again, linking to the economy, linking to government grants, we hope that from an economic perspective, we can get enough growth, create more jobs and that the grants will support those that need it, so that we don't have a powder kick such as civil unrest in future. It is so that there are more competition coming into our market. I think a lot of the other retailers in South Africa have realized that we're in a lucrative market that we are probably in one where the prospects for the future are good. So competition has increased and to a large extent, not too much that we can do about that. But what we can do is make sure that we entrench our own positions. We've been in the discount and value market for longer than anyone else. And we've got to make sure that we still keep delivering and improve the delivery of our customer value propositions in our different brands to our customers. And that's all about providing them with a product that gives dignity and respect at prices that are really affordable. And as long as we can keep doing that, and I'm sure we can because we've done it for so long, I think we will have a really dominant position in the market. And then lastly, on the supply chain side. The supply chain is well reported. Everyone is having challenges there, similar to us. And -- but it's improved lately. So there are 2 aspects to the supply chain that are inhibiting. The first thing is obviously the cost. So the cost of shipping has increased. The cost per container has increased dramatically. So we all know that. But fortunately, we've had the Rand strengthening. I'm not talking about the last 2 or 3 months, but before that we had a Rand strengthening. And the gains we got from that, we could offset the additional cost of shipping. So the net effect on the prices of the items that we are selling was basically 0, and there was no additional cost for the business. Unfortunately, we don't have the benefit of a strengthening Rand anymore. So the additional cost on the shipping and containers is going to be built into the prices of our merchandising future, which means that inflation will probably rise. And I predict -- or we foresee that from winter next year, winter '22, there will be a higher inflation than we've become used to over the last 2 or 3 years. But that's unfortunately part of the environment. I have to say that from an availability point of view, because that's the other big part of supply chain, there we've had ups and downs. We've got lates in the business and the lates go up and then they fluctuate up and then they go down and up and down. I have to say that fortunately, it seems like we -- if things are normalizing, there will be -- there are still lates, but it's relatively small in the bigger scheme of things. So from a supply chain point of view, yes, there are challenges, but we are sort of managing it. And in terms of stock, we have enough stock more than enough in our business at the moment, and that's not an issue. It's trying to manage the price or keeping prices low for our customers. That's our biggest challenge. It is said that a business that only exists to make a profit is a poor business. And we've also -- we truly subscribe to that saying, and we know that we need to build a better business. That's not only reliant on profits, but where you build a better environment for customers, for your employees, for your communities. And obviously, your suppliers and everyone else forms part of that. And a lot of focus also obviously goes into that. And I thought I'd just share you a couple of -- not ideas, just share with you how we think about it and what are the areas that we take into account when we think about building a better business overall and not only a profitable business. And that starts with customer enablement, and I think we do more than our share of that in terms of making product affordable for customers that really, really need it and providing essentials in convenient locations for people that really, really need it. So that's something where we feel we contribute a lot to our customers and the communities. Employee development is important. And again, to give you an example, over the last year, we provided leaderships to more than 2,000 people in our business, people that we bring from outside, teach them jobs, teach them retail, et cetera. And we're particularly proud of that number, which in South Africa, if you compare to most others is really, really a very high number. We trained more than 30,000 people last year. Some of them may be more than once. But I mean, lots of training in the business. And then we do a lot in terms of succession planning and very happy with what we do in terms of developing our people and empowering them in the process. Community support, something like ZAR 57 million worth of CSI given to communities last year. And we're quite happy with doing that, because we feel that the communities are supporting us and that we should support them. Most of the focus in community support goes towards the young population, children education. That's where we focus. That's because that's where most of our business is in PEP, especially in PEP and Ackermans, which is a better part of our business. But it's not only limited to that, even businesses like JD, The Building Company, et cetera, supports in that sort of same communities. And we do a lot for a lot of organizations, who we support, and also a lot of schools that we support on an ongoing basis. Socially responsible supply chain. I mean, we've been fortunate to have worked with Pepkor Europe, and they've helped us to develop a system of audit with our suppliers. Even if they are abroad, it's easy way to do that in South Africa. But -- so there's a regular audit of our suppliers and -- to make sure that we are socially responsible, that they are socially responsible, and we'll continue doing that and even enhance that as we are now in our own office in Shanghai, but not only in Shanghai, also in South Africa. We're also working with some of our suppliers in South Africa, trying to capitalize them so that they can increase their local imports -- local production, I mean. Local production, one of the areas that we particularly look at to increase over -- in the future to -- in line with the master plan by government. And hopefully, we'll start seeing progress or real progress and real investment in that in the coming year. As far as diversity and inclusion is concerned, we are BEE compliant this year, which we are very happy with. We are very satisfied with the representation of the general Pepkor employee and that it's representative, more than representative enough of the population in South Africa. Where we are not doing as well as we want to is at senior level where we feel -- not feel, where we know we must still improve, but we've been building a good pipeline over the last few years. And hopefully, we'll start that -- see the fruits of that come through in the next year or 2. But a lot of effort going into that. Environmental protection has always been important to us. If you're a low-cost business, you must make sure that you're efficient. In other words, that your trucks don't drive unnecessarily, that you use less consumables than you have to or than the average guy does, et cetera, et cetera. So a lot of work has been done over the years to keep -- or to protect the environment indirectly, although the focus wasn't the environment, but more on cost savings, et cetera. But that is indirectly led to us. Our footprint actually being lower than most other retailers, which we are quite proud to say. But there's a lot of work that we must still do. There's a lot of focus that's going into that at the moment. And it's something that we still need to develop, especially from a base case determination point of view. And then as far as governance is concerned. If one looks at FTSE4Good, which measures, amongst others, governance, we rate very highly on that. So I think after the scares that we've had over the -- about 3 years ago, we made sure that governance is very solid in Pepkor. Lastly, just looking -- just looking forward to our growth drivers, and I've spoken about this before, so I'm not going to take too long on this. But in terms of store expansion, we're still talking about 300 new stores a year. I told you that 200 of those will be PEP and Ackermans and the others would be from the other brands. But we continue to grow, and we continue to invest in growth. And we're still positive that we can do that. We believe that there's still market share for us to gain, and we believe that our business models are flexible enough to keep that growth going. We're still working on the format. We're still growing them to Ackermans Woman. I mentioned earlier, we're going to open 30-plus stores in the coming financial year. Ackermans Connect is a Ackerman's version of a PEP Cell. That's -- we don't have huge plans, but that's also growing -- going to grow over the next few years. And as I said, they've got a customer that's slightly different from the PEP Cell customer. PEP Cell is already at 500 stores and still growing. Home, I spoke about. Dealz is the one concept that's been on this list for a while now, that we haven't made the progress that we thought we would. We're still at about 17 stores. We still haven't got the model quite right yet, and a lot of effort is going into getting the model and the recipe right so that we can also use that as a platform for growth in the discount variety environment. Adult wear, again, I mentioned a lot of these. We bought Code, we bought SPCC. It's small, but again, providing platforms from which we can grow in the future. Ackermans Woman has done very well in its initial phases, so also very positive. A lot of time and effort goes into fintech. I mean, it's not only Pepkor, you can see the whole environment in terms of fintech has been a focus area. Our customers are changing, maybe not as fast as in some other countries, but they are changing. Their behavior is different and the requirements that they have from retailers, et cetera, are going to change. And we've got to change accordingly. In fact, we've got to lead those changes in some regards. Something like the digitizing of cash is becoming more and more important. It makes a new economy or an economy accessible to a lot of our customers, and that's something that we believe we can play a role in to grow our customers in future to acquire those customers. We need to build an ecosystem that not only gives them the ability and accessibility to buy, but also provide them with an ecosystem that provides their need -- for their needs. From footprint leverage, again, PAXI is the perfect example where we leverage from our current footprint. We're always on the search for new opportunities in that regard. As I said earlier, we've really become a one-stop shop for clothing. We were known as clothing, now it's just about everything except for groceries. And yes, through items like PAXI, DStv subscription, bill payments, airtime, et cetera, and so on, it's about important that we keep on leveraging that footprint. E-commerce, more and more progress. JD is a center of excellence almost in the country, especially in the tech division. But now all the brands, except for PEP in the clothing sector is on e-commerce. And Everyshop is an exciting development. So a lot of work happening in that arena, and I expect good potential to be unleashed there in the future. Informal market is the FLASH market. How can we use the leverage that FLASH is giving us in the informal market, how can we use that in future by building on it and expanding the service that we provide to a lot of the sponsor shop owners or traders that are in that informal market. So we need to develop that further and provide more support to them, but also more products to them that can help make their lives easier and better. And then lastly, our balance sheet is much stronger. Obviously, if the right opportunities come along that are aligned to our own objectives that are aligned to our sort of value discount model, then we must make use -- or we must consider those opportunities. And with a better balance sheet, it gives us more flexibility. And if the right opportunities come along, we'll obviously grab them. Then just thank you for what's been a difficult year or 2. Thank you to our customers who have kept supporting us. And we hope -- we trust that we will -- we don't trust, we know that our objective will always be to be -- to give them not only dignity and respect, but also to give them choice, to give them access, to give them the ability -- abilities that they need to make their lives better, our employees for taking us with the great cultures in our respective businesses for what they've done during difficult circumstances to support the business and run the business and to build the business into a better one. From a leadership point of view, nothing like this can be achieved without great leadership in our respective brands in the businesses. So thank you to all of them for what they've done and for the example that they've set. To our suppliers, all these external macroeconomic factors, one thing a supplier wants is consistency and predictability. And the macroeconomic factors didn't provide that. But despite that, they've worked with us, and we've worked with them to make sure that we keep those not only the relationships intact, but that we keep each other profitable and kept each other growing. And then lastly, for the investors that showed confidence and trust in the business, thank you to you for that. That is our story this year. Those are our results, ones that I said earlier, I'm very proud of, and thank you for your time and attention. And after this, we go on road shows, and we'll see all of the analysts and investment businesses -- investment houses in South Africa. And then you are obviously free to ask all the questions that you want. Thank you, very much, and good afternoon.