Satisfactory trading results were produced for the year to June 30 2008. Headline earnings per share rose by 10,1% while trading profit increased by 17,3%. For 19 years, annual compound growth in headline earnings per share has been 24%.

Earnings reflect good contributions from Bidserv, Bidvest Asia Pacific and the South African food businesses. Areas of underperformance reside principally in Bidpaper Plus and Bid Auto, impacted by the effects of a retail market under pressure.

A more challenging business environment showcased the advantages of Bidvest’s decentralised business model as our divisions optimised opportunities across various geographies and industries.

High interest rates, spiralling inflation and lower consumer confidence had only limited impact on most Bidvest operations until late in the year. Though South Africa’s GDP growth slowed, continuing infrastructure spending by government provided a degree of support for the economy.

Working capital management was identified as a critical issue early in the year. The Group is tightening internal controls to improve returns on funds employed.

Revenue grew 15,5% to R110,5 billion (2007: R95,7 billion), driven by market share growth and benefits from inflationary pressures.

The trading margin was slightly improved at 4,8% (2007: 4,7%). Rand weakness had a positive effect on the translation of offshore earnings, particularly in Bidvest Asia Pacific. The rand traded at an average of R14,64 (2007: R13,95) against sterling. Basic earnings per share growth of 19,3% was achieved.

Bidvest continued to trade off a growth platform and our balance sheet remains strong. Substantial returns on recent infrastructure investments were not anticipated in 2008, but we expect incremental returns to grow.

Net debt rose to R5,5 billion, though interest cover at 5,7 times reflects ample borrowing capacity. Net finance charges increased from R566,2 million to R931,0 million. Hardening interest rates and the effects of the global credit crisis highlighted the appropriateness of Bidvest’s conservative attitude to debt.

In April, Fitch affirmed Bidvest’s national long-term rating of AA- and a short-term rating of F1. However, the outlook was changed from stable to negative.

Higher debt was driven by capital expansion, the acquisition of Angliss Asia and increased working capital demands. The first full-year performance by Angliss was ahead of expectations while Viamax became a major contributor to Bid Auto. Many operations have found it necessary to carry strategic inventories in view of stock shortages, increased volumes and product inflation.

Staff numbers rose from 104 814 to 106 225 while training investment continued to increase. The Bidvest Academy continues to develop future leaders and completion of the first graduate programme is imminent.

Bidvest has stepped up its focus on sustainability. Businesses will strive to turn ‘green’ into ‘gold’ in a manner that delivers profit, efficiency and quality while integrating evolving financial, social and environmental needs and expectations. Our businesses are united by a positive attitude to sustainability that looks beyond today’s obligations to tomorrow’s opportunities.

Bidvest remains an acquisitive company. A more challenging trading environment in domestic and international jurisdictions will create opportunities. With effect from July 1 2007, Bidvest acquired 100% of the Viamax Group, a vehicle management and leasing business, consisting mainly of a vehicle rental fleet, for R961,1 million. Viamax contributed R544,4 million to revenue and R203,8 million to the Group’s trading profit.

Subsequent to year-end, Bidvest has agreed to dispose of its interest in Enviroserv Holdings Limited subject to the successful implementation of a scheme of arrangement between Enviroserv and its shareholders.