Reunert Limited · JSE:RLO
Reunert — Investor Presentation (July 2008)
34 slides from Reunert's investor presentation, Jul 31, 2008
Slide 1: Presentation to Reunert Investors
•Presentation to Reunert Investors Martin Maddox 31 July 2008
Slide 2: Products and Services
Products and Services Nashua Electronics Group Finance •Finance and accounting •Warehousing and logistics •Parts •Service networks •Distribution Creditors and debtors management Systems Consumer E-commerce Manufacturing Products Products / Retail •OA •Brown goods •Electronic consumer •Plasma/LCD TV
Slide 3: Products and Services
Products and Services Nashua Electronics Group Finance •Finance and accounting •Warehousing and logistics Transferring •Parts •Service networks within •Distribution Creditors and debtors management Reunert Group Systems Consumer E-commerce Manufacturing Products Products / Retail •OA •Brown goods •E
Slide 4: Manufacturing
Manufacturing
Slide 5: Set Top Box Opportunity
Set Top Box Opportunity - Biggest single electronics opportunity in the country’s history - South African Government Committed to Digital Migration - Department of Communication/Digital Dzonga responsible for the migration process - Compression Technology: MPEG 4 - Digital switch on: 1 November 2008
Slide 6: Nashua Electronics History
Nashua Electronics History - 47 years relationship with Panasonic, Japan assembling a variety of consumer electronics related products - Extensive experience in electronics manufacturing: - Manufactured the first 1 000 000 Analogue Set Top Box for Multichoice South Africa. - Manufactured the world f
Slide 7: What do we offer
What do we offer - Leading consumer electronics supplier - High volume electronics manufacturing capability • Flexible Manufacturing capacity. • 50 000 – 250 000 units/month. - Distribution & product support - Empowerdex rated level 4 BEE supplier - Locally designed set top box
Slide 8: Nashua STB DVB-T MPEG4 Set Top Box
Nashua STB - SA Compliant - Reliable - Compact - Affordable - Low Power - Plug & Play DVB-T MPEG4 Set Top Box
Slide 9: The Technology
The Technology - MPEG 4 technology - Designed for Software and Hardware Conditional Access - Cost effective solution - ST & NEC product experience - Designed for low power & reliability - SD/HD capability - Hardware configurable
Slide 10: Project Status
Project Status - Nashua has been appointed as the primary supplier of DVB-T Mpeg4 set top boxes to the SABC for trials commencing 1 November 2008 - Digital Dzonga Board responsible for managing the Digital Migration Project has been appointed - Digital Migration Policy document not yet approved by c
Slide 11: Distribution and Retail Businesses
Distribution and Retail Businesses
Slide 12: Distribution vs Retail
Distribution vs Retail • Limited profit opportunity (worldwide • Market related profitability based on 0,5% - 2% PBT) added value • Limited ability to add value • Solutions add value • Long lead times • Ex-stock purchases • Poor payment terms (creditors/debtors) • Reasonable and manageable terms • C
Slide 13: Nashua Electronics
NASHUA ELECTRONICS Group Panasonic (NPC) •Finance and accounting •Warehousing and logistics Pansolutions •Parts PBS •Service networks •Creditors and Debtors management •Human Resources Panasonic Import Systems Consumer Retail & Distribution Retail ECommerce Sourcing Stores Other suppliers ECommerce
Slide 14: Consumer Business
Consumer Business
Slide 15: Difficulties facing Consumer Electronics Import and Distribution Business (NPC)
Difficulties facing Consumer Electronics Import and Distribution Business (NPC) • Ease of entry to the market – Digital technology – Speed of R&D development – Transfer of technology • Market Slow Down – Interest Rates – Credit Bill / Controls – Reduction in housing prices
Slide 16: Consumer Electronics Industry Market Size
Consumer Electronics Industry Market Size 140 136 120 100 2007 vs 2008 80 73 60 Year on Year % 41 40 Change 20 (’07 = 0) 0 -10 -10 -10 -8 -20 -22 -40 DVD PLAYER DVC DSC LCD PLASMA PTV/FLAT AHS CTV Apr ‘07 vs Apr ‘08 % Change -35% -4% 16% -20% -35% 12% 25% -1%
Slide 17: Difficulties facing Consumer Electronics Import and Distribution Business (NPC)
Difficulties facing Consumer Electronics Import and Distribution Business (NPC) • Ease of entry to the market – Digital technology – Speed of R&D development – Transfer of technology • Market Slow Down – Interest Rates – Credit Bill / Controls – Reduction in housing prices • Brand Premium Erosion •
Slide 18: Unit Price Erosion
Unit Price Erosion 100 80 60 40 20 0 2003 2004 2005 2006 2007 2008 DVC DSC Plasma LCD
Slide 19: Difficulties facing Consumer Electronics Import and Distribution Business (NPC)
Difficulties facing Consumer Electronics Import and Distribution Business (NPC) • Ease of entry to the market – Digital technology – Speed of R&D development – Transfer of technology • Market Slow Down – Interest Rates – Credit Bill / Controls – Reduction in housing prices • Brand Premium Erosion •
Slide 20: Why Agents remain under threat in Consumer Electronics
Why Agents remain under threat in Consumer Electronics ISSUE AGENT SUBSIDIARY Profit Double profit Single profit SA industry based profit Country of origin based profit Decision making Slow - investigated Fast - on trust - following strategy - leading strategy - negotiated - instructed Market Import
Slide 21: Percentage Internet Usage by Country
Percentage Internet Usage by Country 80 70 70.2 72.3 68.8 68.1 62.5 63.8 60 58 59.2 59.8 60.8 50 40 39.2 30 26.2 20 10 10.3 11.6 6.8 7.1 7.4 7.4 0 2002 2003 2004 2005 2006 2007 South Africa USA UK
Slide 22: E-Commerce Retail Sales in South Africa
E-Commerce Retail Sales in South Africa (excludes airline ticket sales) 600 R 514 500 R 428 400 R 341 300 R 252 200 100 0 2002 2003 2004 2005 2002 2003 2004 2005
Slide 23: Key Issues
Key Issues • Balance the Balance Sheet • Small PBT • Brand Investment • Other Opportunities
Slide 24: Systems Businesses
Systems Businesses
Slide 25: Nashua Electronics
NASHUA ELECTRONICS Group Panasonic (NPC) •Finance and accounting •Warehousing and logistics Pansolutions •Parts PBS •Service networks •Creditors and Debtors management •Human Resources Panasonic Import Systems Consumer Retail & Distribution Retail ECommerce Sourcing Stores Other suppliers ECommerce
Slide 26: Distribution Networks
Distribution Networks 1 2 1 1 3 1 3 28 PBS 1 3 1 21 RISTAR PRESENTATION 3 1 28 SYSTEMS 1 7811 6 4 2 1 67 AIRCON 2 2 2 3 2 1 4 2 1 29 CCVE 1 6 BROADCAST 2 1 2 2 5 TOTAL NETWORK OUTLETS = 179 1 1 2 1 2 2 8 6 2 2 3 52 1 2 12
Slide 27: Systems Businesses
Systems Businesses Common Key Success Issues currently limiting Factors industry growth • Steep technological • Discounting restrictions development curve (Digital • Larger pipeline required for Product) conversion of sales • Direct dedicated distribution • Longer decision making time • BEE requirem
Slide 28: Office Automation & IT
Office Automation & IT • Colour Market Segment Growing • New Colour MFP below 20cpm (4th quarter ‘08) allows entry into SOHO segment • Software solutions for Document Distribution, Archiving and Cost Management
Slide 29: Telecommunications
Telecommunications • Historic uptake on VOIP slow due to broadband cost & availability – upgrading of infrastructure & competitiveness (Neotel) should stimulate demand • New large port IPBX (2009) allows opportunity to compete in large port segment
Slide 30: Presentations
Presentations • Digital Signage market growing • New Panasonic software successfully launched • 103” Plasma introduced 2007, 150” in 2009 • New interactive whiteboard aimed at education sector (3rd quarter ‘08) • Digital signage opportunities with 2010 and Gautrain
Slide 31: CCVE
CCVE • Strong IP product line-up, increased broadband availability & affordability opens new opportunities • Infrastructure Upgrades for 2010 • Monitoring of City centres & highways • Facial recognition software • 360° Grand Eye Surveillance Holocam IP Camera Solutions
Slide 32: Broadcast
Broadcast • Panasonic P2 technology adopted during ’08 by SABC for news acquisition • International P2 users include CNN, BBC, Reuters, TF1 & RAI • Panasonic Studio Cameras launched mid 2008; opportunity for studio and OB van upgrades for 2010 & HD
Slide 33: Air Conditioning
Air Conditioning • Energy efficient product with lower power consumption • Opportunities with infrastructure development for 2010 • Full range of Commercial products
Slide 34: Key Issues
Key Issues • Tighten Networks • Broaden Solutions and Service Offerings • Vertically Integrate and Rationalise Costs