Super Group Limited (SPG) Earnings Call Transcript & Summary

Good morning, everyone, and welcome to the Super Group Limited June 2023 year-end results webcast. As discussed [indiscernible] this morning, our group CEO, Peter Mountford will take you through the results presentation that it will include a financial presentation by our Group CFO, Colin Brown. Should you have any questions, please feel free to post them in the chat line, and Peter and Colin will answer them at the end of the presentation. Thank you for taking the time to join us this morning, and I'll now hand you over to Peter Mountford.

Good morning, ladies and gentlemen. Thank you for the introduction, John. Super Group year-end presentation will commence with an overview of the financial highlights for the year to June 2023 and an analysis of the group's performance since the COVID disruption period. We'll also briefly touch on the global trends impacting our markets and provide an analysis of divisional performance. Our Group CFO, Colin Brown, will then take you through the detailed financial results for the 12 months concerned. The webcast will thereafter conclude with a summary of Super Group's prospects for the forthcoming financial year. Against the backdrop of intensified consumer cost pressures and protected supply chain disruptions, the group continued to optimize the opportunities inherent in challenging markets. Super Group's competitiveness was evidenced in significant new client wins, contract renewals and market share gains, rigorous cost management mitigated escalating inflation, diesel price increases and brand volatility. Group's revenue increased by 30.6% to ZAR 61.88 billion with the EBITDA increasing by 20.8% to ZAR 8.49 billion. These increases reflect strong sales performances in the supply chain Africa operations, SG Fleet, South African and U.K. dealerships. Revenue of SG Fleet included a full year's performance from LeasePlan compared to the 10 months in the prior year. Operating profit of ZAR 3.95 billion was 20.7%, up on the prior year benefiting from the higher consumer convenience and commodity volumes in Supply Chain Africa and strong performances in SG Fleet and the dealership operations. Earnings per share of ZAR 472.9 cents with 24.9% up on the prior year, whilst headline earnings per share increased by 23.3% and to ZAR 469.4 cents. Operating cash flow increased by 18.9% to ZAR 8.72 billion. Net asset value per share increased by 20.5% to ZAR 46.27. Year-end, excluding the IFRS 16 impact and the Securitized Warehouse funding was 22.5% as of June 2023. Super Group has an excellent track record, navigating demanding environments and realizing opportunities for expansion and growth. This record underscores a proven ability to deliver long-term value to all stakeholders. Group's growth over the last decade, especially in the three years since the pandemic is tangible evidence of its long-term competitiveness and wealth generation capability. In comparison with 2019, revenue has increased by 63% and EBITDA is up by 126% to ZAR 8.49 billion. Profit before tax and earnings per share have increased by 32% and 31%, respectively, when compared to the 2019 pre-COVID period. Net asset value per share has increased by 52% since 2019. Volatile socioeconomic climate, Super Group continues to demonstrate the adaptability and resilience required to leverage market challenges as opportunities for growth. This diversified operations across the globe, experiencing the adverse impact of events such as surging inflation, ongoing product shortages and the war in the Ukraine, Group proactively adjusted its business models, client solutions and operational processes to stay both relevant and competitive. This agility allowed the group to seize growth and consolidation opportunities and to successfully reposition itself in response to shifting consumer demands and market dynamics. Super Group's deliberate diversification strategy has further buoyed performance in a turbulent trading environment. Group remains well positioned to manage fluctuating demand and supply chain disruptions across all of its operations. We now proceed to the divisional reviews, commencing with an overview of geographic and segmental contributions as well as return on net operating assets. Super Group's international and other African operations contributed 54% of the sales revenue, 56% operating profit for the year to June 2023. SG Fleet and the United Kingdom Dealerships now account for 45% of revenue and 49% of consolidated operating profit whilst the German and Iberian supply chain businesses contributed 7% of revenue and 3% of operating profit. An analysis of revenue and operating profit contribution by division is provided on slide. Revenue contributions for the year from the Supply Chain, Fleet Solutions and Dealerships divisions with 36%, 21.4% and 42.6%, respectively. Operating profit contribution for the Supply Chain division was 34.7%, and the Fleet Solutions and Dealerships divisions, generating 47.1% and 18.2%, respectively. Group's minimum strategic target for the post taxation return on net operating assets is weighted average cost of capital plus a 30% premium. This calculates to a return target of 9.1%. Group's return on net operating assets for the year to June 2023 was 10.2% compared to 10.3% prior year. Supply Chain South Africa business reported a 2.9% increase in operating asset returns to the 11.6% level indicated, mainly as a result of improved performances, consumer and convenience business operations. The European Supply Chain returns increased by 0.4% to 2.4%, reflecting the impact of a number of operational improvements. Fleet Africa continues to perform below target levels as a result of the competitive industry landscape and poor levels of new business generation. Return on net assets in this operation have, however, improved to 11.6% compared to 9.8% in the prior year. SG Fleet returns decreased by 2.6%, largely as a result of the annualized impact of the net operating assets of LeasePlan. The dealerships in South Africa and the United Kingdom reported satisfactory returns on net operating assets. Supply Chain divisional analysis has provided separately across the African and thereafter European Supply Chain operations. Reflective of sales volume increases and new client wins in the Consumer businesses, Supply Chain Africa revenue increased by 38.3% to ZAR 17.8 billion. Operating profit increased by 48.7% to an amount of ZAR 1.26 billion, and operating margins increased from 6.6% to 7.1%. Technology-based solutions in the Consumer businesses delivered greater efficiencies and cost savings to clients contributing to a significant new business wins and contract renewals. A diversified product basket and improving volumes in industries such as hospitality, entertainment and the quick service restaurants also contributed to the strong performance. Strong volume increases were experienced in the South African and African Logistics, Consumer and Commodity Transport businesses. Industrial businesses also performed well, good sales and profit performances from SG Mobility, SG Freight and Super rent. Supply Chain Europe revenue increased by 19.7% in euros and 30% in rand, reflecting the ongoing evolution of the business model to ensure both relevant services and optimize cost structures. Operating margin increased from 1.9% to 2.7%, driving an operating profit growth of 84.1%. Operational enhancements, such as the consolidation of shipments on to larger vehicles, higher average kilometers per load and the recovery of increased diesel and other operating costs have been key to this growth. [ ADA ] required 75% of the shares in both T.I and Delver in the north of Spain on the first of July 2022 at a total net cost of ZAR 40.1 million. Revenue from these acquisitions amounted to ZAR 366 million for the year. The weakening of the rand against the euro had minimal impact on these results. At this point, we progressed to the Fleet Solutions businesses, commencing with the SG Fleet operations. Benefiting from continued strong order growth and gradually improving supply chain levels, SG Fleet's revenue increased by 23.6% with operating profit increasing by 23%. Customer wins and orders resulted in steady growth with the order book again outpacing deliveries and further extending order pipelines. Novated channel, in particular, saw a surge in interest for its products. Improved vehicle supply was largely limited to new market entrants and electric vehicle manufacturers and mainstream vehicle models remained scarce. Used vehicle values remained stable, the business should benefit from improving delivery numbers in the next financial year. New Zealand and the United Kingdom contributed positively to the SG Fleet results. New Zealand vehicle registration numbers remained strong, tender activity continued largely at the same pace, both across the corporate and government sectors. In the United Kingdom, some of the concerns about interest rates began to abate, leading to a steady improvement in corporate and consumer sentiment. As more opportunities emerge, the company was able to step up its win activity. The LeasePlan integration progressed well with a focus on further benefit extraction by standardizing SG Fleet's technology solutions and leveraging its greater scale. Weakening of the rand against the Australian dollar positively impacted the results by ZAR 88.2 million for the year under review. Good growth in ad hoc rental volumes on existing contracts enabled Fleet Africa to produce solid results with revenue increasing by 1.2% to ZAR 1.09 billion for the year to June 2023. Underpinned by innovative technology efforts to secure new business outside of the [indiscernible] sector are progressing well. Fleet Africa's joint venture with the Co-Op Bank in Kenya continues to gain momentum and the region remains a key component of the business growth strategy. Kenyan operations reported revenue growth of 50% and operating profit growth of 39%. The overall business' operating profit increased by 8.2% to ZAR 243.1 million, operating margins increasing from 20.9% to 22.3%. Increase in operating margin reflects higher ad hoc rental volumes. New business opportunities have been negligible over the past year. Number of tender opportunities suspended in 2020 and 2021 have still not been revived with fleets moving beyond optimum life in many parastatal and corporate environments. Moving now to the dealerships division and commencing initially with the South African operations currently comprising 50 dealerships and representing most brands in South Africa. Delivering strong profit growth, the South African dealership revenues increased by 14.5%. Increase in revenues is mainly as a result of increased new vehicle sales volumes and a strong services performance. Dealership new vehicle sales increased by 19.1%, significantly outperforming the NAAMSA growth of 10.1%. Despite of the used vehicle market coming under pressure, the division maintained the sales volumes achieved in the prior period. Leadership South Africa's operating profit for the year of ZAR 408.3 million was 20.7% above the prior year. Operating margins increased to 3.9% from 3.7% reported in the prior year. This improvement reflects the benefit of steadily improving parts and [indiscernible] volumes. Dealership's U.K. footprint continued to grow as a result of strategic acquisitions, selected brands and key locations. 7 new dealerships across the Hyundai, Kia and Suzuki brands were acquired at a cost of ZAR 502.8 million. Despite the pressures of continued inflation and higher interest rates, the business performed well in the year under review, reporting at 44.6% increase in revenue, a 29.1% increase in profit before tax in round terms. New vehicle volumes increased by 39.9% as the availability of stock improved over the second half, in particular. This compares favorably with the U.K. passenger and light commercial vehicle market growth of 11.9% over the same period. Used vehicle sales volumes increased by 29% as used vehicle stock availability improved. Operating profit increased by 28.1%. The decrease in operating margin from a prior level of 2.3% to 2% reflects lower used vehicle margins. At this point, I will hand over to Colin Brown, who will take you through the detailed financial information.

Thank you, Peter. Good morning to everyone on the webcast. Beginning with the statement of comprehensive income. Total revenue increased by 30.6% to ZAR 61.9 billion and EBITDA was up 20.8% to ZAR 8.5 billion. Operating profit was up 20.7%, with operating margin decreasing from 6.9% to 6.4% due to one-off items in the Services segment. These included business interruption insurance claims in the prior year and BEE scheme closure dividends and acquisition costs in the current year. If the Services segment is excluded, operating profit would have grown by 29.7% and operating margin would have remained at a consistent 6.4%. Net finance costs rose by 31.5% to ZAR 1 billion due to higher interest rates and borrowing levels across all geographies. 83% of the impact of increased interest rates was passed through to clients and the remaining 17% was covered by increased interest received on cash balances. The tax rate decreased from 30.7% to 27.7%, mainly due to the lower South African corporate tax rate and nondeductible acquisition costs in the prior year. HEPS increased by 23.3% to ZAR 469.4 cents per share. And if we exclude the Services segment, the growth in HEPS was 46.9%. Dividends per share have been increased by 27% to ZAR 0.80 per share. Moving to the statement of financial position. Increases in property, plant and equipment, mainly related to vehicle fleets, in supply chain and properties and dealerships. Total lease portfolio assets increased by 38.9% due to increased originations in the corporate and novated lease in SG Fleet. The majority of the increase in goodwill and intangible assets relates to seven acquisitions that were completed during the year and the weakening of the rand. Inventories increased by ZAR 2.2 billion as a result of improved availability of dealership stock and the acquisitions in the U.K. Trade and sundry receivables increased in line with the revenue growth plus the impact of the acquisitions. The cash balance of ZAR 9 billion includes ZAR 1.8 billion that is held in securitized warehouses in SG Fleet and ZAR 810 million raised for the AMCO acquisition. The next slide provides some detail on the equity and liabilities of the group. The deferred tax liability is up mainly due to a tax refund in Australia of ZAR 615 million. The increase in trade and other payables funded the combined increase in receivables and inventories. Net gearing, excluding securitized warehouse debt and ROU borrowings was 22.5%, which remains well below the group's established ceiling of 40%. Net asset value has increased by 20.5% to ZAR 46.27 per share. Moving to net borrowings. Super Group raised a net ZAR 1.81 billion in bonds during the year, of which ZAR 810 million was raised for the AMCO acquisition. The increase in the United Kingdom's net debt was largely due to the acquisitions made in the first half. ZAR 15.3 billion of the borrowings in Australia and New Zealand are held in the securitized warehouses owned by SG Fleet. The financiers of these warehouses only have recourse to the lease portfolio vehicles and receivable balances with no holding company guarantees from either SG Fleet or Super Group. The Group remained well within its debt covenants throughout the year at both Super Group and SG Fleet levels. The total net borrowings balance was ZAR 19.7 billion at the end of the year. Turning to the statement of cash flows. Operating cash flow increased by 18.9% to ZAR 8.7 billion. The group had strong working capital performance during the year with a net cash inflow of ZAR 517 million. Net investment in lease portfolio assets was ZAR 4.8 billion and cash outflow from acquisitions and other investing activities amounted to ZAR 484 million. Moving to the rest of the cash flow statement. The group repurchased 17.5 million shares for a total value of ZAR 527.8 million during the year. Net interest-bearing borrowings of ZAR 3.1 billion and net lease portfolio borrowings of ZAR 693 million were raised during the year. Group ended the year with ZAR 9.06 billion in cash and cash equivalents. Thank you. I'll now hand back to Peter to go through the strategy and prospects of the group.

Thanks very much, Colin. We'd like to touch on a number of important strategic themes for focusing on prospects for the financial year to June 2024. Super Group remains committed to its strategy of being an innovative mobility solutions company. Strategy is robust, and the group will continue to explore consolidation and growth opportunities in Australasia and Europe, the United Kingdom and South Africa. In Supply Chain Africa, the focus remains on pursuing new business opportunities, encompassing new brands, product categories and markets. Technology remains a key competitive advantage within the division's integrated end-to-end solutions offering. Driving collaboration and integration across business units, is also important in the structure of innovative and cost-effective client solutions. In Europe, diversification of the in-time customer base to mitigate the automotive industry dependency remains paramount. Improved flexibility and enhanced electronic trading solutions are still a significant focus over the next year. The integration of the LeasePlan acquisition is a key priority within SG Fleet and the delivery of business synergies is critical over the next two financial years. SG Fleet Australia is focused on the expansion of their corporate business and leveraging of cross-selling opportunities into technology platforms in areas of transport planning, repair solutions, ride-hailing and sharing. Focus in Australia remains in the leveraging of digital platforms such as Zoomo and Carly. SG Fleet is directly invested both Zoomo and Carly, which are e-delivery and vehicle sharing platforms. Fleet Africa will continue to pursue new business opportunities in the corporate sector and full maintenance lease market expansion opportunities in East Africa, maintaining strict overhead and margin management remains critical within that business. In South Africa, the group will focus its dealerships businesses. affordable and higher volume brands, such as those reflected in the recent expansion of our Suzuki operations. Digital capabilities remain a core focus on strengthening of sales pipelines and customer retention. U.K. leaderships have made significant progress on one-stop commercial platforms across funding, maintenance and insurance products. The year ahead, focus will be on the growing fleet partnerships, expanding original equipment manufacturing representation and fully integrating the operations of the newly acquired businesses, including at this stage with prospects for the financial year to June 2024. Global landscape sector remain volatile, and the group will continue to face macroeconomic challenges in the year ahead. Difficult operating environment does, however, present significant opportunities to both innovate and grow. Super Group has proven itself to be both resilient and adaptable. The year ahead will be no different. The group remaining well positioned to manage the risks and leverage the opportunities inherent in a complex trading environment. Together with technology-based solutions and fit for focus assets, group's world-class infrastructure and expansive geographic footprint will remain key to new business wins, client retention and market share gains. Manufacturing and supply chain disruptions will continue to negatively impact product availability and prices in Supply Chain Africa operations. Nevertheless, significant new business wins and contract renewals should continue to boost revenue growth and consumer businesses in particular. Improving volumes in industries such as hospitality, entertainment, quick service restaurant also expected to bolster performance. Gradual improvement in new vehicle production levels and automotive parts distribution volumes should bolster the performance of the European Supply Chain business. Division will maintain its focus on industry diversification with further expansion expected in agricultural and industrial parts offering. Rigorous cost management remains essential. The acquisition of AMCO will support growth and create synergies between the European and the United Kingdom operations. SG Fleet is expected to perform well with a steady improvement in the availability of new vehicles helping to meet pent demand. This improvement in availability will moderate the pricing of these vehicles. New business wins, strong retention rates, the realization of the LeasePlan synergies will support growth. Fleet Africa remains well positioned to withstand a volatile trading environment and leverage new business opportunities. Increased activity on existing contracts and good growth in ad hoc rental volumes should continue to produce solid results. Further expansion of the business' fleet leased presence in East Africa will also remain a priority. With the consumer under pressure, the year ahead will be a challenging one for the South African dealerships market. Given the impact of inflation and interest rate hikes, consumers will continue to delay their purchase decisions, will look to buy more affordable models. Supported by strong contributions from services and three products area, Dealerships SA is well placed to deliver another good performance. The United Kingdom improved availability, new vehicle stock supported good performance, although the consumer remains under financial pressure from high interest rates. Demand for used vehicles should remain robust and will be supported by increased trade-in activity levels. Strong demand for commercial vehicles support performance in the year ahead. In conclusion, Super Group is well positioned to deliver another strong financial performance in the year to June 2024. Group has declared a dividend of ZAR 0.80 per share based on the 5.9x cover on earnings per share. In closing, I would like to extend my appreciation to our dedicated employees, loyal clients and shareholders for their valuable contributions and ongoing support of Super Group. Thank you. On behalf of both Colin Brown and myself for your attendance of this webcast, we invite you to put forward any questions arising from the presentation or related financial reports.

Good morning, Peter Mountford here. I see we have just got some questions coming through. I'll paraphase them or read them out if they're not too long. The first questions are from Nick Webster, HSBC. A few questions. Can you give some color on the new contract wins, if there's any way to quantify that in value terms and also comment on how you believe you are taking market share. So the new contract wins in our supply chain business are primarily in the consumer and convenience arenas. We have had a number of food and beverage distribution contracts that have been gained in that space. We've also had a significant gain in some beverage contracts in [ Liban ] logistics as well, and we have had an expansion of some of our retail distribution, probably an impact across consumer and convenience of about 15%. We don't generally give the names of the customers in that area. When -- the second question, when do you expect Supply Chain Europe to meet or exceed its WACC? And is it mainly cost efficiency issues? Or do you need more volumes? And the straight answer is obviously, you've seen an improvement in the WACC in our Supply Chain European opportunity -- is not the WACC. Improvement in the RNOA in our Supply Chain European operations to 2.4%. You've also seen the weighted average cost of capital going out in that environment very significantly, and that's a function of the significant interest rate increases that you have seen there. I would expect that the RNOA in our Supply Chain European operations improve. We would be ambitious of seeing it around 3%. Now that would exceed the prior year's weighted average cost of capital, but not the current weighted average cost of capital, which is [indiscernible] has jumped from 2.9% to 5.9%. The reason for the underperformance in Supply Chain Europe is absolutely volume related. We have taken significant costs out of those businesses. Our volumes are 25% to 30% below where they need to be. What -- third question, what quantum of synergy benefit should we expect from LeasePlan? In this year and the next in the forthcoming year, approximately $4.5 million pre-taxation and then the year thereafter, $5 million to $6 million pre-taxation with the larger savings from technology consolidation coming through in the '26 year. Fourth question, what are your margin expectations in Dealership South Africa, given the decline in used vehicle margins and greater emphasis on value and volume brands? So the margin in Dealership South Africa was 3.9%. We think that the margin will erode slightly. My expectation would be 3.6% to 3.7% despite some softening in used vehicle margins, but you've got to also bear in mind that as new vehicle sales increase, you get a better source of secondhand vehicles and that also helps with the overall operating profitability. Question 5. In Dealerships U.K., what is the split between passenger and commercial? Also you sound positive on that market despite mounting pressure on the U.K. consumer. We are positive. We've got record order books in the U.K. We have not been able to fully fulfill on outstanding orders, particularly in the Ford brands in the U.K. The split between passenger and commercial is approximately 80% passenger and 20% commercial. The other element of the U.K., you're starting to see some positive commentary. Obviously, they have had very high interest rates, and obviously, that impacts on consumer spending. But there's a lot more economic rhetoric that they're getting to the top of the interest rate cycle in that environment. Brent Madel Absa, three questions, please. Supply chain Africa operating profit declined 10% between first and second half. Does this reflect lower coal volumes transported in the second half? No, it doesn't. Coal volumes this year were approximately 12% up on the prior year. But the impact between the first and second half is primarily in the hotels, restaurants, catering and quick service restaurants environment, where we saw, obviously, those sectors boom going into the Christmas period, and the second half was softer in those particular sectors and restricted to those sectors. Leadership South Africa, can you explain how you exceeded the non-new vehicle sales to the extent that you did? Is the function of the multi franchise model, is the higher margin sustainable? I think I answered on the higher margin sustainability. We have focused on a multi-franchise model, absolutely. We've grown our representation in brands such as Suzuki, which is some of the top-performing operations for us and Cherry as well. So that -- there is definitely an impact of the multi-franchising element there. And obviously, as the split of our sales start to show a higher proportion of more affordable vehicles that as well as driving some of the volumes. And then it is, of course, always about a process of sales and service excellence. Fleet Africa. To what extent did ad hoc rental support the performance given that it typically generates higher margins? You know, ad-hoc rentals do obviously generate substantially higher margins, but they are less than 5% of the turnover there. So it's not a scenario where that is driving the bulk of profitability at all in Fleet Africa. There's more drive in profitability from the rotation of fleets that are starting to happen in existing contracts now. And we did emphasize that many parastatals and corporate contracts are way beyond economic useful life on some of their vehicles. [indiscernible] Can you comment on group operating margins for FY '24? Will you be able to get back the lost margins? And what levers will you be pulling to get there? The overall group operating margins for FY '24 will be very similar to the current year. The areas that we'd like to see margin improvement obviously, in the Supply Chain European operations, and that is possibly the one upside, but I'd expect operating margins to be very similar to what you've experienced in the current year, despite some of the softness of these vehicle pricing and the small impact we talked about in the dealership South Africa operating margin. [ Ron Gulacronax. ] Can you expand on the Africa overland and commodity volumes supply in Africa with particular reference to coal volumes? I think Ron, I said to coal volumes were about 12% up on the prior comparative period. They have -- that sort of growth has been relatively stable throughout the year at that type of level. A lot as exports going through Maputo. So yes, there's been a significant amount of export volume moved out through coal through Maputo. Across in the African logistics environment, volumes are 3% up on the prior year, so not a huge impact there. [ Tumaling Sinago Escom ], how sustainable is the Supply Chain margin at 7.1%? The first half margin was strong at 7.5%, but softened to 6.6% in the second half, can you give us color on what drove the compression in margin? Absolutely, that overlaps my earlier question. The difference between the first and second half was primarily within our, Digistics type operations and within -- which are quick service restaurant environment, plus hotels, restaurants and catering. Do I think the Supply Chain margin is sustainable at 7.1%? I do believe that particularly as we have a full year of some of the beverage and food products that we have attracted in the last year. You mentioned -- second question. You mentioned that strong volume increases in South Africa and African Logistics, Consumer and Commodity Transport business, do you expect to see strong volumes in Commodity Transport -- sorry, yes, Commodity Transport in the next year, given how commodity prices have softened? I mean there's always an impact of commodity pricing. And when you start to see a softening as we have done in the coal volumes, you start to see more volumes moving back through the mines towards Eskom and local coal utilizers as opposed to exports. At this stage, we haven't seen a significant softening of our export coal volumes. [ John Prince Central, ] can you please split out the operating profit contribution to Supply Chain Africa between commodity, industrial and consumer? We stopped doing that two, three years ago. Obviously, we believe that, that is very sensitive customer and competitive information. So that is not something we disclose. [ Mark Narramore, Excelsior Capital Buy Side ]. Supply Chain Europe second half came in a lot lower than the first half. How should we think about the margins in this business going forward, considering the recent acquisitions in this segment? You're actually right. Supply Chain Europe second half was a lot lower than the first half, and that reflects something like a 25% to 30% lower volumes than expected, largely coming out of the German automotive industry, which is very, very disappointing. And there has been an oversupply of operators in that environment. The benefits we do see are from consolidation of cargoes into larger vehicles from getting better kilometers traveled and from driving significant costs out of the business, but we most certainly need to see improved volumes going forward. The AMCO acquisition will make a significant impact on that. AMCO will certainly see a significant improve in margins within the European segment going forward. And AMCO are seeing consistently good volumes coming through in their client base in the U.K., including automotive, where, in fact, some of their clients are going up very significantly going up 33% of production levels. So the U.K. is looking very much more dynamic from an automotive segment and from automotive operators such as Jaguar, Land Rover, Bentley, Rolls Royce and the like, than actually you're experiencing in the German sector at the moment, where volumes are very disappointing across the lot of luxury brands. [ Mark Narramore, Excelsior Capital Buy Side ]. Can you elaborate on some of the recent acquisitions, rationale, multiples paid, et cetera? While I think we've disclosed the AMCO multiples, which are below price earnings multiple is below 6. And the rationales, absolutely AMCO gives us a very strong position across industrial products, warehousing and distribution, automotive warehousing and distribution in the U.K., freight forwarding and clearing as in customs in the U.K. as well as air cargoes in the U.K. It is a business that services its client base, including Jaguar, Land Rover, Bentley, Rolls-Royce, and many, many others in the U.K. and potentially some very exciting customers that we're currently looking at as well to bring on board major Japanese customers in the U.K., but they do a lot of distribution of those products and industrial products and aviation products like Lear Corporation and others, Rolls-Royce Aerospace and other into Europe. And so they're very strong in the air cargo. They are credited IR to cargo agents, so they package for final distribution, package in IR to packaging, which goes straight on board of planes. So obviously, security levels have to be exceptionally high in those operations. They also clear all cargoes between the U.K. and Europe. They clear containers on an average of 24 minutes per container between Europe and the U.K. Now they move a lot of those products into Germany. We're looking for significant overlapping business between AMCO and inTime, so that in time get to represent AMCO and give them their complete branch network availability across Europe and in the reverse we would like to see some of the inTime volumes in the German manufacturers in the U.K. going through AMCO. The connection of those two management teams has gone very, very well. The synergies we are looking at, at the moment. And I do think there will be significant business flow between the two entities, which is a positive. [ Rowan Guler, Chronix Research ], will the dividend cover come down over time? Roan, I think in the last year, as you saw, we bought back about ZAR 528 million worth of Super Group shares and maintained our dividend cover -- dropped it ever so slightly to 5.9, but that's purely a rounding , really on cents per share. I think we still targeting share buybacks. We still see significant value in the underlying Super Group share. And at this point in time, we would still be focused on a dividend cover of approximately 6x, but it is looked at every bar board, and it is obviously capable of [ beflexed ]. [indiscernible] [ Long Mark ]. Could you give us some insight into the outperformance in the Supply Chain Africa business, particularly across the three divisions, revenue growth or profits? How do you see the key drivers there? So as I said to you, the big upside assumed that you focus largely in the three divisions of supply chain. I assume you focus then on consumer, industrial and commodities. The revenue growth and profit growth has been significantly higher in consumer and convenience than the other businesses they have come off historically relatively modest basis. And so the significant revenue growth in this year derived from the consumer convenience businesses, whereas you've had good performances in industrial and the commodity businesses. The key drivers there are new business generated, consolidation of cargoes in the freight operations, expansion with some of the new clients. So in some of our major new opportunities, we have taken on certain sectors, such as the convenience sector or such as reverse logistics on some of their products. There's a massive opportunity to grow that to full logistics service across top [ Medtrade ] as well as well as rolling out to those customers in United Arab Emirates, Dubai, where we have started to get some really good traction and where we have now three or four major retail distribution clients and starting to see some strong performance. We talked about that we moved into the retail and distribution environment in Dubai, got Carrefour, we've got Almarai Group, which is way larger than Carrefour and then one of the major beverage groups now in discussions in that environment with us. [ Anati ], again, [ Long Mark ] in SG Fleet, we see the secondhand prices have held up end-of-life residual risk income. Do we see those soft landing in FY '24? I mean that's a really interesting question, [ Anati ] because there's been so much talking about softening of secondhand vehicle prices. And there is an element of softening of second-hand vehicle prices that are taking place. I do not see a significant impact of that in the forthcoming year, and there will be countering elements from replacement of vehicles, introduction of new vehicles and an increase in secondhand vehicle stock. So I do think it's going to be a very soft landing in FY '24 as opposed to anything like a crash landing. How is the uptake of electric vehicles in Australia, particularly in the novated place -- space? The reality is the world is so focused on electric vehicles. You're starting to get a lot more pragmatic statements coming out of Germany, out of their government recently. The U.K. is going to election year. So the green and electric issues are high up on the agenda. So you won't see a more pragmatic response there yet. The reality is that electric vehicles are -- this take-up in Australia is very, very slow. The take-up in the U.K. is very slow, and at South Africa, it's almost nonexistent for the many obvious reasons that we know around our distances and electrical supply. So it's not a major factor in Australia at this space. That having been said, it's way South Africa is a percentage point in Australia, we're heading for about of the new vehicles probably about 4% or 5%. Nick Webster, sell side -- sorry, Peter, sorry there. Do you foresee SG Fleet still achieving their synergy target at AUD 20 million? Absolutely, Peter. That is, for us, pretty much cast in stone. That was a major aspect of our decision-making around the acquisition, and that is driven by the combination of the two technologies. That is expected to materialize in FY 2026. And the reality is they just felt there would be so many systems changes coming so quickly at our customer base that they slowed that pace down, and they covered that in their presentation as well. Nick Webster, a quick follow-up, please. Can you provide growth or contribution to revenue? I think we've answered that question, that growth -- we don't split out commodities, industrial and consumer within Supply Chain Africa for competitive purposes. Okay [ Anati ] do you foresee a changing in the Super Group stake in SG Fleet as we have seen in the past? Can we expect the share buyback strategy at current levels going forward? [ Anati ] absolutely. We're regularly looking at the value proposition of Australia versus South Africa. We also take cognizance of the Australian market, and we certainly don't want to impact the liquidity of the SG Fleet share in the Australian market. At this stage, Australia is at a significantly higher multiple than Super Group. So there is obvious value in the purchase back of Super Group shares in the current environment. And certainly, we see the share buyback strategy going into the forthcoming year. It is opportunistic and it is obviously driven by volumes in the market. Last year, we were able to get a fairly significant volume early on in the financial year. I'm not sure we are replicated this year, but share buybacks are part of our strategy, and we are comfortable to buy back at current levels going forward. I can't see the name hasn't come out clearly. Who are you taking market share from in these consumer contracts? Is it small players or some of the larger players? It has been -- it has -- in one of the larger beverage side, it's more of an outsource than they've ever done before. And actually, it's taken market share from a competitor that we wouldn't have historically competed with. So it's a player that has been more involved in pellets and containers and those type of volumes where we are finding that we are expanding into that as well. So it has been a mixture of outsourced for the first time as well as primary larger players. The names are not coming out clearly at the moment. I think that [indiscernible] brings hybrid. Can you indicate how much SG Fleet's order book has grown as at FYE? How much of the order book was undelivered at FYE? So the order book has grown. It's grown by a further 8 percent. And the level of order book undelivered is quite significant at this stage. It's over 30%.