We Buy Cars Holdings Limited (WBC) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the WeBuyCars Annual General Meeting. Thank you for making time today to attend online. We appreciate that, and we also appreciate your support throughout the year. So thank you very much. You know what the purpose is of this meeting. It's to present the audited consolidated and separate annual financial statements of the company for the year ending 30 September 2025 as well as the remuneration report, report of directors, audit and risk, social ethics, et cetera. And it's also to obtain approval of the ordinary and special resolutions stated in the notice of the Annual General Meeting. Just a few points to navigate the meeting platform. If you like to pose questions please click on the Q&A icon at the top of your screen. If you have a question on a particular resolution, please type the resolution number followed by your question and press it. I'm going to open it now without delay so that it enables you to post your questions. We will, after the resolutions have been voted on and management has had an opportunity to say a few words, have a general question section where you can pose your general questions. So you don't have to do that immediately, but you're most welcome to if you want to. Now the results of the poll will be announced, as I've said, after the close of the formal business of the meeting and also after the management's presentation. To turn to the notice of the meeting that has been circulated on 23 January, 2026, and therefore, we have had it in hand for some time. I propose that the notice be taken as read. Any objections? Any questions? If nothing. Thank you, Peter, then we can proceed. It is also proposed that the voting take place by poll using the online voting facility provided by Computershare. For purposes of the poll, I nominate the representative of the transfer secretaries present at this meeting to act as scrutineers. Any questions, objections? Nothing. Then we can proceed with that. In order to expedite the proceedings of the meeting, I will also open the voting on the online facility now, and you may submit your votes during the duration during the meeting until I close the polls. I will then announce the results of all the resolutions put to the meeting after the management's presentation. To cast your vote electronically, please note the following. I'm just going to run through this to assist those that haven't voted. All shareholders or their representatives who have requested to vote who have received the link and access credentials to the voting platform via the e-mail address. Once the platform has been accessed, click on the vote icon on the top of your screen. You will notice that the voting platform contains all the resolutions which have been published in the notice of meeting. You may indicate your votes individually per resolution for, against, abstain. And once your selection has been made, the confirmation message will be forwarded to you. You are most welcome to change your vote on the change vote link, but please note that once I close the meeting, you won't be allowed to change your votes anymore. Any questions? Nothing? Okay. Fantastic. Thank you so much. Then we present the audited annual financial statement and reports. As I've just indicated in the beginning of the meeting to you as the shareholders, that will include the REM com report, the audit and risk, social and ethics and also the directors' report. For ease of reference, you can find the annual financial statements published on 17 November 2025 also under the financial results section on the WeBuyCars website. Directors' report on Page 5, the audit and risk on Page 52, social and ethics on Page 54 and the REM com Page 58. We will now turn to the resolutions. We can just change the slides for that. So you will notice that there's ordinary resolutions #1 to 7. That only requires 50% plus vote to passing. The series of individuals noted in these resolutions have been included in the annual report. So you have had a chance to look at that. And then the first resolution that we will focus on. I just want to make sure of the company Secretary, are there any questions on the resolutions.

No resolution and [indiscernible] questions...

When the resolution related questions come in, please just stop me. Otherwise, I'm going to continue with the resolutions. So ordinary resolution #1 to reappoint PricewaterhouseCoopers and the designated auditor, Johan Potgieter. Can we please vote on that. [Voting]

Then we get to ordinary resolution 2, and that's different sections to 2.1 and 2.2. The first is the retirement of directors to the Board and the reelection process by rotation. The first is 2.1 is Nicolaas Kruger. And the second ordinary resolution 2.2 is Willem Roos. So please vote. Thank you. [Voting]

Then on the reappointment of the members of the Audit and Risk Committee of the company, that's an obligation on an annual basis that must take place Ordinary resolution 3 that's again approx 4 subsection if I conclude it that way. The first is Samara Totaram on 3.1, 3.2 Bridgitte Mathews, 3.3 Nicolaas Kruger and 3.4 Willem Roos. So please vote on those resolutions. [Voting]

Okay. Then we turn to the reappointment of the members of the Social and Ethics Committee of the company and there's 4 subsections resolutions. The first is Bridgitte Mathews 4.1. Second is myself, JA Holtzhausen. Third is Willem Roos, and the fourth is Faan van Der Walt. Please vote on that. [Voting]

Thank you so much. Then we turn to ordinary resolution #5, and that is a nonbinding advisory vote on the remuneration policy. If you can -- in terms of [indiscernible] that is described, it's a non-binding vote. And if we don't obtain a certain percentage indicated, then we will engage shareholders to discuss that. So please, if you can vote. [Voting]

Thank you. Then we get to the non-binding advisory vote on the implementation report from the previous year, we implemented the previous year's report. So if you fill the resolution #6, again, as I said, to the extent that 25% or more of the votes exercised in respect of the resolution are against the resolution, then we will engage with shareholders. [Voting]

Then authority to implement resolutions passed by this AGM is quite normal. Otherwise, we can't execute. That's ordinary resolution #7. You can please vote on that. [Voting]

Thank you. And then we turn to the special resolutions 1 to 4, that as you know, requires 75% plus in order to carry the resolution. The first one is on the remuneration of the nonexecutive directors that will be valid for a period of 2 years or until the next resolution at [indiscernible] contain the numbers in the credit report. So if you can vote on special resolution #1. [Voting]

Thank you. Then the intercompany financial assistance in terms of the Companies Act requirement to provide loans and guarantees from the group to company related parties. If you can please vote on that -- then inter -- and the next one is inter-company financial assistance [indiscernible] apologies, financial assistance for the subscription and the purchase of shares of the company or a related or inter-related company similar principle in terms of the Companies Act, as you can see on the screen, please vote for that. Thank you. [Voting]

Resolution #4 that's limited to a maximum of 5%, and we have no immediate debts to do any buybacks. We think it's prudent to have it available. So if you can please vote on that resolution. [Voting]

Thank you very much. If there's no other questions on the resolutions, I close this meeting, the formal part of this meeting. And then we can give a very high-level feedback from the Social and Ethics Committee. Bridgitte Mathews is also here today. So if you've got questions, you're most welcome to pose them, but you can find that on Page 54 of the report. And you can see on the screen the highlights of 2025 where we focus responsibility as a corporate citizen, stakeholder relations, overseeing organizational ethics, compliance and the like. And then obviously, the implementation and integration of an independent whistleblowing function that we monitor regularly on the committee and the support that to the Board and then to deepen the understanding on the ESG level. And I think the rest is summarized on the slide. If we can turn to the focus areas, the next slide, [indiscernible] not the slide I just talk to. Okay. So on the focus areas, obviously, we will evaluate and if need be update the ESG strategy. We will look at [indiscernible] and the effects of that on the company and what must be implemented from that perspective. We will enhance our ethical oversight of technology, ensuring that our innovative use of technology is consistent with our values. And we'll complete some of the reviews of policies that is ongoing. On the screen, you can just see a few sort of a summary of things that we do, but a lot more is done than just that. So any questions on that, Peter? Questions we've received through [indiscernible] on the general section. Thank you very much. I'm going to hand over to, Faan van Der Walt that's the CEO, as you know, and the Deputy CEO, Dr. Wynand Beukes. And Chris Rein is also here the Financial Director, CFO of the company, if there's any questions for him. But Faan van Der Walt, please give us a little bit of feedback before we announce the results.

Fantastic. Thank you, Mr. Chair, and good day to everyone in attendance. I'll do the first part of the feedback, which will mostly cover property developments, after which I will hand over to finance, who will talk through some exciting developments regarding the acquisition which we announced and the [indiscernible] as well as a big change that happened since we last met at the previous AGM, which is [indiscernible] that was launched. But yes, back to the branches. Since we started 25 years ago, the importance of having well positioned and visible locations has always been key to WeBuyCars growth. And finding such locations is not easy. It's always a challenge, especially when it has to be affordable and makes sense in terms of what it costs us per vehicle sold. So I'm pleased to report that over the last 12 months, we have opened 4 new branches, which helped us increase our footprint and our capacity by around 25%, which is for us critical in achieving our growth aspirations. We stated a goal of reaching 23,000 units per month by 2028, and this enables us to do that. The first branch that opened during this period was the [indiscernible] branch. This is a BMW and Audi dealership that closed doors that we purchased and redeveloped and it opened in August last year. It performed better than what we expected, selling on average around more than 500 cars a month. Then the second branch that we opened in this period is Montana. This is an ex [indiscernible] training facility that we bought on a disposal auction for what we believe a very good price was, and we demolished and rebuilt a brand-new facility there. That opened on time and under budget on the 1st of December. And so far, again, also outperforming our expectations, selling more than 1,000 cars in the first month. The following branch is Lansdowne. Now this branch opened late due to municipal red tape and other challenges we experienced there. Luckily also under budget that was supposed to open at the beginning of December, but only started operating in mid-January. Results so far look very promising. I think Lansdowne will certainly give the [indiscernible] and our midstream branch, which is our second biggest branch, a good go for its money. So very excited about that, especially with us and give more space in Cape Town. And then the last one, eMalahleni you would know historic [indiscernible] This is probably one of our smaller branches and Witbank opened a few weeks ago and also doing really well, very low-cost branch and a very quick development that we've done that also released pressure on our Mpumalanga branches. So those are the 4 properties that opened. And yes, this positions us to at least go beyond the 20,000-plus units a month, and there are more to come, which we'll talk about sometime in the future. Then other recent infrastructure developments that we've done includes automated wash bays. Now it sounds boring, but tech and automation is part of our DNA, and we have to always look at processes and see how we can do things quicker at lower cost and more consistently. And that's where these wash bays comes into play. You can see there in the pictures, this wash bays is far bigger than most car dealerships in South Africa. But it has the ability to wash hundreds and hundreds and hundreds of vehicles nonstop and at very low cost. So this helps us and we've done the same at Montana, and we're doing the same in Lansdowne which will just help us have quicker processes. Yes. So that's it from me. I'll now hand over to to talk about Wynand to talk about [indiscernible].

So we get the question quite often why we like started Inspectify. I want to talk about that first. We love Inspectify for 6 reasons and the data proves it was right. Firstly, accuracy. Our inspections data tells a difference clearly. Inspectify's average conditions score is 2.79 versus 2.15 our predecessor. That's a 30% improvement adjusting relevant issues detection. More inspections or more accurate inspections means better pricing, fewer losses and fewer customer complaints. Secondly, user friendliness. We replaced the static PDF with the interactive digital report. Customers and our own staff can use this report to get a clear understanding of the vehicle in plan with visual diagnostics. The feedback from both customers and employees has been overwhelmingly positive. Third, it serves the consumer. Better and more accurate condition reporting raises the bar for the entire industry. It builds trust and trust drives repeat business. Fourth and fifth, control of the software and control of the data. By bringing inspects in-house, we own the platform and the road map. We're not dependent on a third party development priorities or pricing. But more importantly, we own the data. Every inspection generates data points that feeds our pricing algorithms, our inventory decisions and our own risk models. The data is a strategic asset. Six, it's a platform for growth. Inspectify operates as an independent audited subsidiary. It can function outside our infrastructure, which gives us flexibility. The external interest we're seeing signals a future revenue-generating service line for the group. In short, outsourcing core competency to a third party was costing us accuracy, and control. Just want to move on to GoBid. It's just been over 2 months since we've completed the investment in GoBid and the signs are very encouraging. First question might be why we invested. GoBid is a profitable, well-run digital auction business. We've acquired 49% of the fair price for a business that gives us access to an additional value vehicle value chain. This investment formalizes the relationship and insurance shared in the upside. What impressed us? The GoBid management team, their technology and their systems have generally impressed us. They're agile, they get things done quickly and effectively. That's one of our values. The 2 management teams have started working together really well and the culture fit has been better than expected. The real synergy. When a customer wants to sell a vehicle, particularly the nonowner or one significant mechanical damage. Historically, we would have walked as WeBuyCars would have away from that deal entirely. The customer leaves unhappy and we lose the opportunity. Now our buyers can make an offer as an agent for GoBid in those vehicles and serve the customer on the spot. What this means strategically. We protect the WeBuyCars brand by not selling vehicles that don't meet our quality standards while still monetizing the opportunity under the GoBid brand. In short, we didn't just acquire an investment. We unlocked a channel that turns previously lost deals into shared revenue and we've gained the management team and technology platform that complements that we built over the last number of years. Thank you.

Thank you very much. Before we go to the results, we're just going to deal with a couple of questions. We received answer the first question. What progress has been made towards the company's stated goal of increasing monthly sales volumes to 23,000 vehicles by 2028. What are the biggest risk for starters?

Thank you, Chair. there's a lot to unpack in that question. What progress have we made towards reaching that target. Growth is our DNA. We've always grown and there are a number of things we monitor and watch closely to make sure we stay on track for that. There are various ratios within the business that we don't want to exceed, but we also have to invest ahead of the curve plan for the growth. So as I mentioned earlier, we have invested heavily in infrastructure recently expanding our capacity by around 3% to 5% over the last 12 months. So that's definitely helping us to reach this target. But beyond that, we have invested in people. We've upskilled and trained staff. So we have the right people. People is core to our business. And with our current team and the number of people we have and with the skill levels, we believe that we can handle more volume better. Now part of this also technology, there's a lot to unpack in terms of technology that we've developed, the data sets we have, the ability to price leads and to price cars accurately evaluate cars accurately has increased significantly over the last 12 months. That's core to our business is to have accurate data and to use it to our own benefit. Now this is and will always be a work in progress because as you gain more experience, you learn more. AI wasn't part of our lingo 2 years ago. Now everyone is talking about Claude and ChatGPT and we've embraced this and made it part of our business. So yes, from a technology perspective, we're certainly ready and on the cutting edge of getting ready to grow even beyond that stated target. Now a lead indicator or a leading indicator of growth of leads, I mean we would not exist if there wasn't a demand for our service, which starts with people wanting and needing to sell their vehicle and wanting to make use of WeBuyCars' service offering. A very encouraging statistic is that in January, we received a record amount of leads of people wanting to sell their cars, and we subsequently bought a record number of cars to the tune of 17,600 cars in January, which is far better than the previous record of close to 16,000. So yes, that's evidence we're sitting on our confidence. That being said, obviously, it's not always easy. There are periods where business is stuck and there are periods where you have tailwinds. The economic climate is certainly not very favorable with interest rates being what it is and GDP growth being very, very low. But I believe that we are well on track. And as far as risks are concerned, nothing has changed. You always have risks in business, but we manage that well. There's nothing that really pops into my head that I view as a severe risk. But I would say the external factors that we have no control over our biggest risks. So we're certainly not focused on that because that's out of our control.

Thank you, Faan. The next question again for you. Are you planning to sell further WeBuyCar shares in the near future? Shareholding has dropped from 10% to just under 6%. How does that demonstrate long-term commitment?

Yes. We have no plans at present to sell any further shares in the medium to short term. The disposal of the shares was purely from a value perspective due to the fact that our shareholding in WeBuyCars rose by more than 200%. The roughly 6% that we have left represents more than ZAR 1 billion in our portfolio, which is substantial. So this is where our focus is. And like I said, we're not planning to sell any more shares in the near future.

Okay. The next question is does your own involvement not take your eye off the ball?

No, I think it's purely investment in property with a proven company with a great track record for us, [ Beaukes ] and I have both committed to ZAR 100 million as an investment. So it's purely a buying of shares what it will eventually be. And we will not be involved in the running of that. It's purely an investment like any other investments that we've made over the years. This RMH investment offer that we have made has been made already in 2025, the decision. The announcement just coincides and it's purely coincidental that it's following the sale of shares, but it's unrelated.

Thank you. There's a question, I think we've answered that already that was in the beginning of the meeting. Yes, there's a question for me. Will the company host a pre-close call before the end of the first half ending 31 March. Now it's very difficult to have calls just before a reporting period ends and a close period begins. It creates all kinds of dilemmas. One can say very little really and one tends to sometimes say too much and then we transgress certain rules and regulations. So some companies do it. I think for now, we will err on the conservative side, and we won't have call or meetings just before close period starts. There's another question not specifically addressed to somebody, but around Board diversity. We believe it's diversified enough with only about 25% MAC close to representation. We look at the Board. It's a new still relatively new. We only listed about 2 months ago. So from a diversity perspective, we look at all kinds of things from skill set to race and gender, et cetera. So that is on our agenda. And as we make new appointments, that will be something definitely to consider. Then on the Rem Com side, I don't know if Samara Totaram is online, I think she is and whether she can answer it. Samara, there's more than one question, but it turns around the STI and whether there's sufficient transparency around that disclosing or should we not disclose rankings from . non-financial KPIs. There's no arrangements or outcome tables, and 25% of the STI is discretion. So similar questions around the long-term incentives, whether there should not be more disclosure including KPIs, threshold targets, stretch ranges, et cetera. I don't know if you want to answer that.

Yes. Thank you, Jim. So in terms of how we've disclosed it, we've looked at it from a collective perspective. And we've taken the view that some of the information is commercially sensitive in terms of putting in the full detail. That being said, we're happy to engage with shareholders should they require much more detailed information. I think also when we look at benchmarking against what other companies are putting out, it varies. But I think in terms of we assess it at a very, very granular and detailed level in the Rem Com, and we believe what we put out in the integrated report provided a summary of that, but we are happy to engage in terms of any additional disclosures that may be required and that we are comfortable with putting out.

Thank you very much. There's a question around the NCC settlement and consumer trust risk with regard to the 2.5 million penalty that was paid. And the question is what specific operational or product failures triggered? What has been corrected and how is the Board ensuring that this does not incur? Now it's a good question. We had 2 legal opinions saying that there was no contravention that we were within the framework. But as you know, in any legislative or legislation, there are areas that is gray or potentially debatable. And we did not agree with the regulator on this. if you continue with a fight, nobody wins because a lot of management time goes into that. There's a lot of distraction. You want to play. We want to make ensure that WeBuyCars are successful. And that's why we said let's settle the matter and let's take hands and work together. Where there are disagreements, can we accommodate the regulator, can we find the middle road. And that's actually what the settlement is about. It's not about changing everything immediately. It's by engaging in conversation and finding what is acceptable. I think there's still -- I think there's another question, but I think we -- Another question to Samara. Please explain the removal of from STIs and if you plan to include it again in the future once this ramp-up is complete? Or is this a permanent change?

Thank you, Johannes. So I think maybe to answer the question, it ties back to the first question that was posed to where he talked about the growth in the business and the position of the business, the stage of the business is very, very much in the growth phase and how there's kind of an investment ahead of the curve. And an investment in inventory is actually part of that. It's actually stocking up of the branches. So actually looking at inventory turnover days for where the company is actually right now on its journey is probably not the most or the best way to measure operational efficiencies. I think there is a degree of stockpiling that happens that affects that ratio. And secondly, what management actually also managed to show us in terms of examples is that there are instances if a car is held for slightly longer, the profitability on that car will be greater. So I think from a RemCom perspective, a big viewpoint was how do we enhance overall profitability. And for us, that was kind of the key decision in terms of removing inventory days. I think from an overarching perspective, inventory days is not a measure that's ignored by the management team, even though it's not appearing now on the STI calculations. It's actually viewed at a branch level, even at a vehicle type level or type of vehicle level. So it is an important internal measure for management. But in terms of this growth phase that we see the business in, we've decided to remove it. I cannot comment in terms of long term how we will view it, but that is something that the RemCom will actually evaluate at every RemCom sitting.

Thank you. That will be evaluated from year to year, and it may come back. So we will see. It depends on where we are and what we have done. I don't see any other questions -- if I did miss a specific question, but still -- yes, there's still one question here. So I think that's the last one that I've seen. Faan, I'm going to ask you to answer this. The influx of new Chinese brands materially impacted performance last year. Has this trend persisted? And how is it affecting WeBuyCars currently?

Thank you, Johannes. This is a hot topic throughout the industry, how does Chinese cars impact us and is a permanent impact and how will that change over time. One thing that's certain is that China and India will continue to grow their market share when it comes to manufacturing of vehicles. They're just far better and cheaper than anyone else. And the percentage of vehicles produced globally will steadily increase coming from them. So this trend will certainly continue to impact the composition of cars we see in the market and certain brands will gain market share and others will continue to lose market share. The manufacturers that do well are the ones that embrace this, ford being a very good example. Ford vehicles manufactured in China or rebranded Chinese gears, and this is not a new phenomenon. We've seen this over decades brands coming and going. What's important to us is WeBuyCars' new vehicle sales and because that grows the used vehicle market and the used. A new vehicle can only be sold once, but a used vehicle changes hands more than 3x during its life cycle. So a growing car pool is very positive for us. That's our playground. That's what we excel at. So yes, it did have a negative impact. As market adopters, we are ready to embrace that. We are already trading many Chinese cars very positively. So for us, we have a positive outlook on this.

Thank you, Faan. I don't see any other questions. I don't have anyone pick up question that I missed. If I did miss a question, please e-mail it again or we will look at the questions, and we will revert to you. Thank you so much for your participation. Now we're going to go over to the results. Pieter?

Sir, I can confirm that all of the resolutions have been passed.

So thank you, shareholders for voting and making time. And therefore, I close this meeting. Thank you, everybody.