Raubex Group Limited (RBX) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Thank you for joining the full year results presentation for the year ended 28th February 2023. As is customary, we will walk you through the results, and then there will be time for questions and answers. With that, let's get into the business of the day. The presentation this morning, this is the Raubex core management team and it is supported by a strong, experienced ExCo. The core management team has been working together for over 10 years. If I can take this opportunity to introduce the team. Felicia Msiza, I am the CEO, and I have been with Raubex for 12 years. With me is Dirk Lourens, our chief operations officer. Dirk is 11 years at Raubex. Sam Odendaal, our financial director. Sam is 16 years at Raubex. In attendance is Grace Chemaly, our company secretary and legal adviser. This first part of the presentation will focus on the core message, which we will be delivering this morning. Key milestones are strategy and the year in review. In my first year as CEO of Raubex, it is with great pleasure that I report on the group's results for the year ended 28th February 2023. I am extremely pleased with these excellent results given the macroeconomic and local headwinds we faced during the period under review. The group has delivered an exceptional set of results with record earnings achieved from our diversified portfolio, reflecting solid execution of our strategy in achieving strong growth. Our teams from all 4 divisions supported this pleasing group performance, which was achieved against a backdrop of tough macroeconomic and inflationary pressures. Our future is supported by a record order book of just over ZAR 20 billion. I will take you through this detail later on. Our strategy, which we took a few years ago in terms of having a diversified business model and spreading our risk and opportunity, continues to pay off. We are performing exceptionally well in Western Australia with these operations contributing 19% profit to the group's bottom line. Looking at our key milestones. This slide is a reminder of where it all started for Raubex, how we have grown over the 49 years of existence, while remaining consistent and, importantly, how we have diversified as a group. We come from humble beginnings of being established in 1974 by Mr. Koos Raubenheimer. In 1997, we founded Roadmac Surfacing. In 2001 Roadmac Surfacing Cape. 2007 a critical milestone for us when we listed on the JSE. On the same year, we acquired SPH and National Asphalt. In 2008, we acquired B&E International. 2012 established the infrastructure division through Raubex Infra, Raudev & Raubex Building. 2013, we are acquired Tosas, our bitumen company. In 2014, acquired OMV, our Quarry operations, Shisalanga Construction and Empa Structures. In 2015, we acquired BelaBela Quarries in Botswana, 2018 we acquired Westforce Construction in Western Australia, Donkerhoek Quarry & Transkei Quarries. In 2019, Raubex Construction Australia in Western Australia. In 2021 we acquired minority stakes in a Bauba Resources, Arcadia Minerals and Vanadium Resources. In 2022, we acquired controlling stake in Bauba Resources and due to this diversified portfolio, we started reporting on 4 segments. We previously reported on 3 segments. I would like to take you through our 5-year strategy. Together with our management team, we developed a 5-year strategy that has been approved by the board. This is not a new strategy of the group, but rather a plan of what we want to do, how we will be doing it and the results we expect to achieve as a team. The 7 key pillars of our strategy are: Profitability. We want to focus on profitability and a quality order book is very critical for us. In terms of growth, we want to grow the group at a measured pace through strategic acquisitions and organic growth and unlocking synergies within the group. We also want to become a preferred supplier in our service offerings, which includes infrastructure development and mining services. In the renewable sector, we want to grow our market share in the renewable sector in both public and private renewable sector, both locally and internationally. With regards to technology, we want to be in the forefront of new technologies. PPP, we will selectively target PPP project opportunities. And lastly, and very importantly, our people. We continue to develop, retain and ensure the wellness and safety of our people. So ladies and gentlemen, these are the key elements the ExCo team will be measured on by shareholders and the Board, and this is what I plan to achieve together with my team. Looking at the year in review, starting with our order book, we are executing the order book profitably, and we have increased the strong order book to ZAR 20 billion from ZAR 17.1 billion in the previous period. We have experienced a high tender activity during the year in review, there are a number of projects still pending adjudication, which could substantially increase the order book, if awarded. We are very selective in taking on opportunities with a good risk versus reward ratio. We've also received awards in the Roads division about ZAR 2.5 billion from October 2022 and in the Infrastructure division, we have been able to sign our first wind farm renewable contracts since 2021 with a private client to a value of about ZAR 2.1 billion pending financial close. On our operational performance, I am happy to report that our operating profit is up 35%. The increased profit is as a result of a diversified model. Good contributions from Beitbridge Border Post, Bauba Resources & Western Australia. Our balance sheet management, the group focus on managing the increased working capital demand and maintaining a strong balance sheet. Lastly, I would like to highlight some of the challenges we faced. One of the significant challenge is the negative impact of energy prices in South Africa. Our Construction Materials division has been mostly impacted by these prices. Despite the fuel increase and continued load shedding, initiatives aimed at expanding volumes and reducing costs remain a key management focus. While it is not easy to quantify the total cost, we can see the impact on the bottom line. Management continues seeking solutions in managing this risk. I will now hand over to Sam to take you through the financial highlights.

Thank you, Felicia. Good morning, ladies and gentlemen. Just from my side as well, I'm very pleased to present some of the highlights from our record set of results. We had a great year in 2022, and we followed that up with an even better performance in this financial year. As Felicia has mentioned, it's just -- it wasn't a year of smooth sailing, macroeconomic environment played a big role as well. There was increase in input costs, load shedding and also supply chain issues worldwide. But despite that, we produced a good set of results. If we look at the group financial highlights, our revenue is up 32.2% to ZAR 15.31 billion. Operating profit is up 35% to ZAR 1.28 billion. Headline earnings per share increased to ZAR 3.928 per share. We've generated good cash from operations. We've generated ZAR 1.96 billion. Our capital expenditure has also increased to ZAR 1.15 billion. That include a slide on the CapEx later in the presentation. And as also mentioned, our record order book is currently at ZAR 20 billion. The group's operating margin of 8.3%. We've declared a final dividend of ZAR 0.76 per share, meaning the total dividend declared for the year to ZAR 1.29. Our return on equity is also on the increase, currently at 14.8%. In this slide, I just want to highlight that we've got 4 operating segments that we currently operate in, as Felicia mentioned. Just a reminder that in the past, it was 3 operating segments. And from this reporting year, we split the Materials Division -- all Materials Division into 2, namely the Construction Materials division included in this division is the supply of Asphalt Bitumen aggregates and then there's a Materials Handling and the Mining Division with the materials handling companies doing contract mining and the new mining acquisitions as part of the Materials Handling and Mining Division. The other 2 divisions is the Infrastructure Division and the Roads and Earthworks Division. And in the diagram, you can see which of the companies report under the different divisions, and we look at the segmental performance later. This is a look at the group's performance over the last 10 years. If we look at the turnover, increased steadily to 2017 and it then stabilized from 2017 to 2021. From 2018, '19, we diversified into Australia. And you can see from 2019 now the Australian operations grew year-on-year and then the big increase in 2022 and 2023 was when we diversified again into iron extraction in the specialized resource materials. It's the same when we look at the operating profit. We took a bit of a dip from 2018 because of the downturn in the construction sector. But what is interesting is that from 2014 to 2018, both the Roads Division and the Materials Division contributed to the profits and then from 2019 to 2021, the group was carried by the performance of the Materials Division, and the Infrastructure Division also started to contribute more and more getting that done with almost no contribution from the Roads Division. And over the last 2 years, all divisions started to contribute to the profit. And for me, what's evident from this slide is looking is the importance of our diversification strategy. The group keeps on evolving and through a diversification strategy, we keep on performing consistently. We keep on growing and that in a sector that was struggling over the last few years. If you look at the earnings growth, it's consistently paying out dividends every year without missing a dividend payment to shareholders, except for the COVID year where the payment was just delayed. The return on equity is also on the increase and it's a track record that we are very proud of as a group, and it's a consistent performance through tough times. Looking at the segmental analysis. The bulk of the revenue came from the Roads in the Earthworks division, around ZAR 6 billion that was followed by the Infrastructure Division, with the revenue of ZAR 4.5 billion. We account for the Beitbridge Border Post project, 50-50 between the Roads and Earthworks and the Infrastructure Division. And Australia is included in the Infrastructure Division. These 2 divisions were the biggest contributors to the group's operating profit as well. The margins in the divisions, 5.9% in the Materials Handling and Mining Division, 4.3% in the Construction Materials Division. These 2 divisions were mostly impacted by load shedding. Margin of 8.5% in the Roads and Earthworks Division, and 11.4% interest in the Infrastructure Division, giving us a consolidated margin of 8.3%. Just as mentioned earlier, this again shows the importance of the group's diversification model. This year, the biggest contributions came from the Roads and the Earthworks Division and the Infrastructure Division whereas in 2019 to '21, it was mostly in the Materials Division. If we look at the geographical split of the operating profit, 8.3% margin. The turnover in Australia increased 32%, and the operating profit increased by 39% to ZAR 247 million, and the margins in Australia is healthy at 9.8%. The Rest of Africa contributed ZAR 2 billion to revenue at a margin of 29.8% and the bulk of the Rest of Africa operating profit was generated by Beitbridge Border Post project. The bulk of the revenue in the group was contributed by the South African operations with the average operating margin of 4% locally. This is the CapEx allocation for the reporting period compared with that of the previous year. The materials Handling & Mining Division is the most capital intensive. This year's CapEx spend in that division was ZAR 694 million, included in that ZAR 694 million was Mine Infrastructure and Stripping assets that was capitalized of ZAR 268 million, and that will be depreciated on the units of production going forward. Not big CapEx requirements in the Construction Materials and the Roads and Earthworks Division. Most of the CapEx spend in the Infrastructure division was attributable to the Australian operations. We are still pretty much growing in Australia. And included in the Australian CapEx was a property with offices that we bought to accommodate the increased requirements. We look at the income statement, operating profit for the first time was over ZAR 1 billion, it's ZAR 1.28 billion. Net finance cost almost doubled due to the increase in interest rates and also increased borrowings. Profit after tax is ZAR 858 million. The effective tax rate is down from 31.5% to a more normalized 29.7%. The profit of noncontrolling interest almost doubled from last year and a number of the subsidiaries that was performing well in the year as also minority stakeholders. I can just maybe mention that the 2022 numbers is shown as restated. The restatement of the previous year's numbers related to an adjustment to the fair value of intangible assets and mineral rates in production at Bauba. Last year, the PPA related to the acquisition was provisional. It was finalized this year and the total net adjustment was only ZAR 1.7 million. And we also had adjustment of reporting into 4 segments now instead of 3, that needed adjustment to comparative numbers in the disclosures as well. If we look at the statement of financial position, one of the group's strengths over the years have been a strong balance sheet, and that is still the case. Both the noncurrent and current assets is higher. The increase in inventories is mostly because of the increase of ore levels at Bauba and the increase in development land on the building side of things. Trade and other receivables also came down nicely and our debt collection days improved to 59 days. Our total assets is ZAR 11.3 billion. Then going to equity. I'm not going to spend too much detail on the equity, it increased to ZAR 5.8 billion. Borrowings increased because of the higher CapEx spend for the year. And if you look at the current liabilities, the contract liabilities came down from ZAR 937 million to ZAR 594 million. And included in that number was ZAR 365 million advance payment that we received on the Beitbridge Border Post project when it was started, and that was now repaid during this year. The gearing ratio is in line with that of the previous year, slightly higher at 20.9%. We generated good cash from our operations. After paying tax and finance costs, the group's net cash generation from operation activities is ZAR 1.6 billion. The biggest outflow on the investing activities was the purchases of property, plant and equipment. And on the financing activities, we had big repayments of borrowings and the group also bought some treasury shares. And then there was the acquisition in subsidiaries or increased stakes in investments and the net cash used in financing activities was an outflow of ZAR 256 million, and that brought us to the imbalance of the cash [indiscernible] [ 1.7 ]. The group also declared a dividend of ZAR 0.76 per share, and that brings the total to ZAR 1.29 per share, and that is in line with our normal 3x dividend cover policy. And you can see just the day to dates for the dividend payments are included. I'm now going to hand you over for Dirk Lourens, our COO. He will take us through the operational overview.

Thanks, Sam. Good morning, ladies and gentlemen. I will now proceed in taking you through the operational overview of the 4 divisions, starting off with the Materials Handling and Mining Division. The group is very pleased to -- with this growth in this division. Our revenue increased 78.6% to ZAR 2.88 billion, operating profit increased 35.8% from ZAR 124 million to ZAR 168.6 million. Operating margin decreased to 5.9% from 7.7% in the previous period. CapEx increased from ZAR 318 million to ZAR 693.9 million. This increase is mainly due to the increase of mine infrastructure and stripping costs to the value of ZAR 268 million at Bauba Resources. The order book increased from ZAR 1.89 billion in the previous period to ZAR 3.65 billion. Our turnaround strategy at Bauba Resources has had a positive impact on production with the bulk of the division's profit generated by this entity. We predict that the commodity prices and foreign exchange rates will remain in our favor for the foreseeable future. We continue to capitalize on our strategy to form strategic partnerships with resource owners in the mining sector, enabling us the opportunity to secure the first right of refusal to participate in the material handling and mining contracts. By constantly doing what we do best, we continuously explore opportunities to improve production efficiencies and reduce operating costs, resulting in a better than normal margins. The site establishment on the recently awarded contract for the provision of mining services for Namdeb Diamond Corporation is progressing very well, and we are on track to be in full production by month end. This contract will provide B&E with a sustainable baseload for the next 5 years. Unfortunately, our Mozambique operations for Tosas is still suspended. Therefore, management took a decision to write down the ZAR 50.4 million Pemba Stock. We are pleased to announce that Bauba Resources recently signed an agreement to acquire 74% ownership of an undeveloped resource. This resource is situated on the eastern limb of the Bushveld Igneous Complex. The primary chrome with PGMs resource will be mined by open cast method. Transfer of ownership will only happen when all regulatory requirements have been full filled. The mineral resource estimate is about 17.7 million tonnes with an estimated life of mine of 12 years. We will disclose more information once all the conditions precedent has been full filled. In this picture, we can see the Kookfontein Mine. This pit has been fully mined out and mining operations has already moved to the northern pit. In this picture, we can see the chrome stockpile area of the Moeijelijk in Limpopo. This is also one of the reasons why we entered into the mining infrastructure side of the business and diversify it further. Bauba has recently taken -- has recently awarded the running of the processing plant at this mine to B&E and they are very happy with the outcome. B&E's operations at Namdeb in Namibia, near Oranjemund, where we reclaimed the seabed to mine diamonds. Before we go into the salient numbers of the Construction Materials Division, you will notice that this division's profitability has been severely impacted by the increased production cost due to fuel prices and the effect of load shedding. Our revenue remained the same as the previous period with a small increase of 1.9% to ZAR 1.88 billion. Operating profit decreased significantly by 54.4% to ZAR 81.5 million, down from ZAR 179 million in the previous period. Our operating margin decreased to 4.3%. CapEx spend of ZAR 138 million, and our order book is slightly up to ZAR 1 billion. Despite the effect of load shedding on the margins, we did see an improvement in the sales volumes for the year at our commercial quarries. Unfortunately, our asphalt operations reported slightly lower volumes than the previous year. The major factors for the decrease in asphalt reduction were the effect of the adverse weather conditions in KZN. Fortunately, the demand for asphalt on our N3 SANRAL projects remain high, and we should see an increase in volumes in the first half of FY '24. The general demand in the rest of KZN for asphalt is currently at the low. Hence, the group's decision then to geographically reposition the footprint of our operations in alignment with market demand. The demand for asphalt in the rest of the country remains buoyant. The sales volumes from our bitumen supply operations have increased in the second half of the year. We had to increase our bitumen stock levels during the first half to ensure product availability. This had a negative impact on our cash flow. Luckily, in the second half, we have seen an increase in demand for bitumen, which in turn lowered our stock levels, resulting in an improvement in our working capital. This is a picture of our state-of-the-art Portland Asphalt Plant in Cape Town. Shishalanga is supplying the N3 SANRAL contracts from the Umlaas asphalt plant on the N3 between Durban and Pietermaritzburg. This is a picture of one of our quarry operations, Rosslyn Quarry in Gauteng. The next division, the Roads and Earthworks Division jointly participated with the Infrastructure Division in the successful completion of the Beitbridge Border Post in Zimbabwe. The success of this project is clearly visible in the salient numbers. Revenue increased 32% to ZAR 6 billion. Operating profit increased significantly by 91.3% to ZAR 511 million. Operating margin increased to 8.5% from a previous period number of 5.8%. CapEx remained neutral at ZAR 105 million. The order book is down to ZAR 7.8 billion from ZAR 9.74 billion in the previous period. The focus of this division remains the successful execution of the secured order book. Despite the adverse weather conditions experienced in the year in review, the SANRAL projects on the N3 performed better than expected. The concessionaires like the N3 toll concession, TRAC and Bakwena also contributed to the successes in this division. The site establishment on the Senqu River Bridge in Lesotho is progressing according to plan. We should see a significant contribution from this project in the near future. We foresee that this project will fill the gap created by the completion of the Beitbridge Border Post in this division. There has been some encouraging tender awards in the sector over the past few months with SANRAL being the biggest contributor with ZAR 2 billion of projects awarded to us since October '22. There are still a significant number of tenders pending awards. We believe that we stand a good chance in securing our fair share of it, which in turn will support the solid order book even further. The secured order book in this division puts us in a very privileged position to tender selectively at slightly higher margins. One of our flagship projects for SANRAL on the N3 near Cato Ridge Durban. This is a new interchange that forms part of the N3 Dardanelles project for SANRAL, also near Durban. This picture is a close up of one of the bridges as you've seen in the previous photo. Another flagship contract for Raubex KZN -- another flagship contract for Raubex KZN is the upgrading of the N2 Freeway near Umhlanga and Durban for SANRAL. Now this is a picture of what the road should look like when Raubex is finished with it. The road upgrade was near Wolwefontein on the N9 for SANRAL in the Eastern Cape. Roadmac Surfacing recently completed the Gamtoos reseal project on the N2 for SANRAL in the Eastern Cape. And this is also a picture of what the finished road looked like. Roadmac Surfacing did the upgrade of the N1 Gariep near Free State for SANRAL. The fourth division we report on is the Infrastructure Division. As evident from their salient numbers, this division benefited jointly with the Roads & Earthworks Division on the successful completion of the Beitbridge Border Post in Zimbabwe. Revenue increased 27.2% to ZAR 4.5 billion. Operating profit increased by 37.3% to ZAR 515 million from ZAR 375.3 million in the previous period. Operating margin increased to 11.5%. CapEx increased to ZAR 214 million due to expansion and the secured order book increased significantly to ZAR 7.58 billion from the previous ZAR 4.63 billion. This division is capitalizing on a good secured order book in the commercial building and the housing space. Our private developments in the Western Cape are progressing well with pleasing interest from potential buyers. As mentioned at the half year, the renewable energy operations had no significant impact on this year's results. The government's delay in awarding contracts under the REIPPP program is still a cause of major concern in the industry. We do experience increased activity in the private renewables sector. Various proposals have been submitted awaiting commercial and financial close. We are pleased to announce the award of 3 wind power generation plants in the Western Cape for ACED with a combined value of ZAR 2.1 billion. As this project must still reach financial close, we have not included it in the secured order book. Raubex Infra is the mechanical and electrical contractor for the Redstone CSP project in the Northern Cape. This is a picture where they are busy installing one of the reflector mirrors. Infra also recently completed the civil works for the Vista Park Residential Development in Bloemfontein. This is the beginning of the several works of one of our own developments for Raubex Building is the Newinbosch development near Stellenbosch in Cape Town. Raubex Building is also undertaking the building works at the Kleijne Wingerd development near Stellenbosch in Cape Town. Raudev has recently completed another one of our own residential complexes at Woodwind Estate, Midrand, Gauteng. Empa Structures is busy construction a new bridge over the N2 at the Thembalethu Interchange on the N2 near George. I will now take you through the International Rest of Africa section. Revenue has increased 29.2% to ZAR 2 billion up from ZAR 1.5 billion in the previous period, predominantly due to the Beitbridge Border Post project. Operating profit increased by 105.4% to ZAR 592 million from ZAR 288.2 million in the previous period. Operating margin increased to 30%. Our secured order books remained strong at ZAR 3.79 billion. Our key focus area during the 2023 financial year was the profitable completion of the Beitbridge Border Post. We completed the project in time and within budget. The 17.5-year owning contract has now convinced. As I've mentioned earlier, our operation in Mozambique is still suspended. The Zambian Road development agency is keeping to the payment agreement, and we managed to recover ZAR 47 million of the outstanding debt during this year. The group strategy to take a cautious approach. The working in the Rest of Africa remains unchanged. We will only consider possible projects with a suitable risk reward profile. As mentioned before, the Namdeb and Senqu River Bridge projects will play a big part in replacing the Beitbridge Border Post in the coming years. This is a picture of the Phase 1 truck terminal, what that was completed 2 years ago already. The Bus Terminal was the second phase that was completed and handover. The light vehicle and pedestrian terminal was the last phase at the Zimbabwe Beitbridge project to be completed. This is an aerial view of the newly built residential village near the town of Beitbridge for the border post personnel who's going to be working on the border post. This picture shows where Raubex Construction as part of the consortium is going to build the future Senqu River Bridge in Lesotho. Raubex Construction also recently completed the Mananga Weir in Eswatini. We're now going to look at the international portion and predominantly Australia. Excellent results were reported by our Australian companies Westforce Construction and Raubex Construction. Revenue increased 54% to ZAR 2.52 billion, up from ZAR 1.64 billion in the previous period. Operating profit increased 39.4% to ZAR 247.4 million. Operating margin slightly decreased with 1% down to 9.8%. We had a significant increase in the secured order book from ZAR 1 billion to ZAR 2.37 billion. Tender activity remains very high in Western Australia. This is driven by growth in the mining sector and Western Australia's government infrastructure drive to self-stimulate the economy post COVID-19. Westforce Construction managed to leverage from the experience gained in the renewable energy sector in South Africa. We have the first wind farm project nearing completion. They are very well positioned to capitalize on the quick expanding renewable sector in Western Australia. Our strategy for expansion in Australia at a measured pace remains the same with a cautious approach towards possible opportunities in the Western Australian market. I would like to take you through what we believe the main contributors are for our successes in Australia. The first one being our focus remains on Western Australia only. Secondly, we have a good, competent and effective management locally, supported and strengthened by Raubex personnel from South Africa. Thirdly, we put a huge emphasis on securing a quality order book with a focus on small- to medium-sized contracts in niche markets. Fourthly, we have a very good name in the industry due to our quality and workmanship. And finally, the biggest advantage for both the Australian companies is that they can leverage off the group's strong balance sheet enabling them to generate good cash and grow at a steady pace. The 3 graphs at the bottom of this base -- page, I think, speak for themselves. Some major achievements in Australia this year was for Westforce team working on the Flat Rocks Wind Farm, whilst breaking their own record twice for the largest continuous concrete pours to date in the company's history. The first one being 630 cubic meters for the smaller tower foundation basis and the second time increased to 810 cubic meter for one of the largest wind tower foundation basis. Their celebrations were, however, very short-lived when the Westforce team working on the Mt Keith Debottlenecking Project for BHP soon after set a new record at nearly 1,100 cubic meters in one continuous pour. This is a picture of one of the concrete bases at the Flat Rocks Wind Farm where they set the record. And then if you look at the next picture, this is where the broke their own record and did a 1,100 cubic meters of concrete in one pour on the Mt Keith Debottlenecking Project. Raubex Construction recently completed this road rehab project in Western Australia, and this is what we're doing, what we do best, and we're repeating it in Australia that we're doing in South Africa. Next slide is of Raubex Construction, who is also expert in doing landfill capping projects in Western Australia. Ladies and gentlemen, this concludes my part of the presentation, and I will now hand you over to Felicia again.

Thank you, Dirk. Looking at our order book as mentioned earlier on, our order book is at a record high of just over ZAR 20 billion, which would increase due to some imminent awards. The split on the left demonstrates our consistent growth and the spread of risk and opportunity. Of the ZAR 20 billion order book, ZAR 11.9 billion will be in the current financial year, ZAR 3.6 billion in FY '25, ZAR 1.7 billion in FY '26 and ZAR 2.8 billion beyond. This is a solid pipeline of work in line with our growth. In terms of our order book split, SANRAL is 30% for FY '23 versus 39% in the previous year. Private 27% versus 24% in the previous year. Australia 12% versus 6%. You can see the organic growth typical short-term contracts that we're executing in Western Australia. For the Rest of Africa, 19% compared to 18% in the previous year. Provision is relatively flat, concessions 3% compared to 6%. More work is projected in the next few years in this space. Municipalities and increased to 6% compared to 2% in the previous period. Our order book history. Looking at our 10-year order book history, you can see our consistent growth. The group has doubled in size from 2020, this supported by the diversified portfolio. SANRAL order book is at ZAR 6 billion, followed by private at ZAR 5.3 billion. Private includes our Bauba operations, building and development. The rest of Africa is Beitbridge Border Post, Botswana and Lesotho, and lastly, the consistent growth in Western Australia. In line with the shareholder and analyst requests, this slide shows the breakdown of our order book per customer per division. For Roads and Earthworks Division, the biggest client remains being SANRAL, then the provinces international and concessions. Looking at the Materials Handling and Mining Division, declines remain in private, mostly mining and international. Infrastructure Division, the client is international, which includes Australia and Beitbridge Border Post, private clients and municipalities. Construction Materials Division, mainly private clients. The graph on the right is the timeline per customer. You will see that with SANRAL, the order book spreads to 3 years and beyond the 3 years, which is a good solid pipeline of work for us. Private clients, the same, about 3 years secured order book. Western Australia, as I said, I mentioned earlier on, typical below 12 month, a very active market, and the work actually replaces itself. The Rest of Africa is beyond, which includes Namdeb and Senqu River Bridge, as mentioned by Dirk earlier on. The segmental analysis of our order book is as follows. If you look at the financial year 2023 compared to FY '22. Growth in Earthworks Division slightly lower than last year at 39% in FY '23. Infrastructure Division, it is higher than last year at 38%, I know the question you want to ask about this growth, yes. The answer is that this is due to the growth in Western Australia. Materials Handling and Mining, 18% compared to previous year of 11%. This is due to the full year reporting of Bauba Resources. And then lastly, Construction Materials remained flat at 5%. Just a reminder that this division is strategic and key to the success of the Roads and Earthworks Division. Moving to our people and communities. Our people and communities form part of our ESG strategy that we have implemented which continues to create value for all our stakeholders. Just to highlight some improvements in this area, we have maintained our Level 1 B-BBEE status as well as the group's more than 7,600 employees across the 4 divisions, which translates to a 3% increase in our labor force from the previous year. 84% HDSA representation of our total workforce, an increase from 83% in the previous year. We continue improving on our diversity and working on employment equity by attracting females to the group. We invest in our people through various programs, including talent management, employee retention, training and development. Most importantly, we continue to invest in the communities we operate in through our various CSI programs. Something I am very passionate about lifting and supporting those in need. As I conclude, the Mining Division will continue to pursue strategic partnerships with mineral resource owners to afford the group the opportunity to participate in various material handling and processing opportunities over the medium and long term. In the e Roads and Earthworks Division, the current tender activity in the market remains encouraging. Numerous contract opportunities, which have been tendered by the group are still pending adjudication. There is a good base load of work, which will enable higher margin opportunities going forward. There is an increased activity, which will to the group's material crushing operations including the supply of aggregates, asphalt and bitumen products. Looking at the Infrastructure Division, it is well positioned to take advantage of the private sector and government drive to increase power generation capacity. Opportunities to participate in a number of public private partnerships are also being explored, and we are looking to participate on a selective basis. Going to Western Australia, the construction sector continues to show high levels of activity, the mining sector being the main contributor. Government in Western Australia continues to implement their infrastructure development stimulus program. We continue to explore the market and look for growth at a measured pace. In Southern Africa, we continue with the effective execution of the Beitbridge Border Post upgrade in Zimbabwe, the Namdeb project in Namibia and Senqu River Bridge project in Lesotho, these will remain our key focus. The group's strong balance sheet and healthy cash reserves position it well for future growth and participation in the South African government infrastructure build program. In closing, I would like to extend a big thank you to the best people we have in the Raubex Group across South Africa, Botswana, Namibia, Lesotho, Zimbabwe, Eswatini, Mozambique, Zambia and Western Australia who delivered these excellent results. These are the best people with the winning attitude, commitment and resilience. This is a team that sees opportunities in the midst of economic challenges and all sorts of risk. This is a team that is able to implement agent cost efficiencies in preserving our bottom line. These are the people who come together through synergies, assist each other in achieving a common goal by instilling hope for the future and growth of Raubex. It is true that teamwork is the ability to work together towards a common vision. The ability to direct individual accomplishments towards organizational objectives. It is ultimately the fuel that allows common people to attain uncommon results. I am proud, honored and truly blessed to be part of this amazing team. Thank you, we will now go to questions and answers.

Our first question is from Anthony Clark from Small Talk Daily. Actually has 2 questions. Firstly, says congratulations on your results. His first question is, can you expand on your plans for PPPs and especially the growth you're seeing in the renewable energy. Given the boom expected in that sector due to Eskom, what potential do you anticipate for Raubex?

Thank you, Anthony, for that question. With regards to PPPs, as I've mentioned earlier on, we are looking at opportunities, obviously, using our Beitbridge experience to be able to execute those. On the South African side, Border Post, we know that government is working on those and we are preparing in terms of responding to those. And in terms of our experience, we believe that we are positioned in terms of executing those. With regards to renewables, there has been good activity from the private side. we have submitted our bids in that space. And as Dirk has mentioned earlier on, we have now signed with a private client, which is pending financial close to about ZAR 2.1 billion. And in terms of Australia, yes, we are operating well in that space. We've got a strong management team and they are executing very well.

Thank you, Felicia. Just to elaborate on the question of Australia, Anthony is asking what makes Raubex different? And how can you grow from this clearly unique strategy in Australia?

Thank you, Grace. What makes us different in the space is that although in South Africa, we are a Tier 1 company, but in Australia, we are operating as a Tier 3. We are looking at a very niche market. And I think that actually places us in terms of executing the work and clients are very happy with our quality and they end up extending some of our contracts.

Next question is from Luke [indiscernible] from Prima Research. He similarly says congratulations on the strong results. What is your strategy to replace the Beitbridge project in both value and operating profit? And by extension, what is the strategy to maintain an operating margin above 5% for the Roads and Earthworks Division?

Thanks, Luke. Look, in terms of Beitbridge Border Post in terms of what we're planning to replace it with. We're executing at Namdeb and again, Senqu River Bridge. We believe that with our execution and our experience, we will be able to replace some of the work, obviously, that is coming to an end for Beitbridge. And again, with the stable margins that we are getting from the Australian market. So the execution that we'll be implementing those projects will actually help us in terms of maintaining operating profit. With regards to the strategy to maintain margins for Roads and Earthworks Division, I mean in terms of our order book, we're basically full for the FY '24 and being full, it gives us an opportunity to now being selective. And when we respond to work being tendered, we're able to look at better margins going forward. That is our strategy, and we'll be very selective in terms of the tenders that we will be responding to.

Thank you, Felicia. Our next question is from Marc Ter-Mors from SBG Securities. What could be the 2-year volume uplift from the newly acquired mine by Bauba?

Marc, yes, just if we look at the current operations at Bauba, we worked in the central pit. That work came to an end, and that was most PGM work that we've executed there. But we started working now in the Southern and the Northern pits where it's predominantly chrome seams that we're going to work on. So obviously, with high prices of the commodities at the moment and the good exchange rate, we definitely want to execute and produce more on those -- on the current operations. The new operation will only, however, come into play in about 18 months. So there will not be any benefit in this year or the next year on the new opportunity.

Our next question is from Roy Cokayne from Moneyweb. You have mentioned the group's focus on PPPs. What is the status of the ZAR 6 billion SA Government plan to overhaul and upgrade the country's 6 busiest border posts and now confident is Raubex in securing some of this work?

Thank you for that question, Roy. We still await the revised RFQ on the South African Border Post. I mean, when government announced, they said it's about ZAR 6 billion project minimum. We believe that with the execution at Beitbridge Border Post, this actually positions us well in terms of responding to those spaces.

Thank you, Felicia. The next question is from Anthony Clark again from Small Talk Daily. He says, can I ask on the expansion Bauba. I commend the contribution the new unit add to the results and the uplift in the contribution. However, as an analyst with a long memory regarding companies diversifying into new but seemingly related areas, what checks and balances do you have in place regarding Bauba and its contract? And what is your strategy regarding what commodities you wish to directly participate in Afrimat on its expansion into bulks through criticism when they entered, but prove the market wrong making a huge success. What can you tell us investors regarding Bauba and your plans for this business?

So our strategy with regards to Bauba is in line with the older diversification strategy. By looking into being part of taking up minority shareholding in niche commodities, and we are not looking at being competition for Afrimat in the bulk commodity sector. So our strategy remains the same where we would like to take up a minority stake in niche commodities where we have a seat around the table, which enable us to then negotiate better mining rates for our materials handling and mining companies. So it's a 2-leg strategy. The one is to obviously benefit and to capitalize on the commodity prices and the favorable rand-dollar exchange rate at this point in time. But then also to look at commodities, which is what we call scarce commodities, which will put us in a better place to be -- to secure work for our own companies in the near future.

Our next question is from Marc Ter-Mors from SBG Securities again. With Beitbridge nearing or at completion, how much profits may still be recognized in financial year '24 due to project performance?

Marc, we're almost done with the project. It's 99% complete. We've got signed off on Stage 4. So it will be very insignificant. It's not going to be big profits coming through in the new year. We've started with a maintenance project, which is a 17-year project, but the profit will be quite small.

Our next question is from Jovan Jackson from Laurium Capital. He similarly says congratulations on a really good set of results. Could you please provide margin guidance or ranges for the respective divisions? And what is your current all-in cost for the mining operations?

I'll take that one on the Roads and Earthworks Division. The guidance there is 5% to 7%. Most of the projects that we are executing was awarded quite a while back and the margins there was 5% to 7%. We have recently tried to increase the margins, but no new awards going to land. So that one is 5% to 7%. If we look at the Construction Materials side of things, the asphalt and bitumen operations, the guidance there would be around 5%. The quarry operations around about 12% mark. And then on the infrastructure side, the buildings side of things about 5% and the renewables also 5% currently. The reason why that one is quite low as we don't see that there's going to be a lot of work done in this year on the new awards. It will only be towards the end of this financial year and going forward where that benefit should come through. But on the renewable side of things, it should be double digits in a normalized year. Australia, the guidance is -- has always been around the 8% mark. We've done quite well over the last 2 years. But it is a difficult market, and we think it's going to be around the 8% mark. If we look at the materials handling and the mining, quite a lot of different operations in there, but I'd say the average is around 10% double-digit margin guidance on that one.

Thank you, Sam. Marc, you had a question on additional border post projects. I think we've already covered that. And then the next question was from Roy Cokayne, which has also been covered regarding the Australian operations. So I'm going to jump directly to the next question from Ryan Seaborne from 36ONE. He says congratulations on a great set of results. He says order book up to ZAR 20 billion, even with Beitbridge falling off. Can you elaborate on the potential impact on margins?

Ryan, I think I've already given the margin guidance on the previous question.

Thank you, Sam. For now, we don't see any additional questions coming through. I think that's all for the day. Thank you very much.

Thank you, ladies and gentlemen.

Thank you.