Reunert Limited · JSE:RLO
Reunert — Investor Presentation (2006)
22 slides from Reunert's investor presentation, 2006
Slide 1: Company Presentation 2006
<> RC “Partners in F IN AN C E COMPANY PRESENTATION 2006
Slide 2: RC&C Finance
RC&C FINANCE ◼ Who is RC&C Finance? ◼ Business Model ◼ Funding ◼ Base Analysis ◼ Relevant Statistics ◼ The Future
Slide 3: RC&C Finance
RC&C FINANCE ◼ RC&C Finance is the in-house asset finance company for the Reunert group. ◼ We specialise in office equipment for corporate customers for Nashua, Panasonic Sietel and their franchises. ◼ Only Rental agreements are financed. ◼ We advance funds against against a fixed income stream.
Slide 4: Mission Statement
MISSION STATEMENT “Working together, to create wealth, through innovative finance products, to maximise the rewards for all our partners in profit”
Slide 5: Key Success Factors
KEY SUCCESS FACTORS ◼ Best rates. ◼ Best turnaround times. ◼ Best services. - One on one relationships.
Slide 6: Base Analysis
BASE ANALYSIS ◼ SPLIT BY CUSTOMER ◆ Nashua 88% ◆ Panasonic 8% ◆ Sietel 4%
Slide 7: ISO 9001:2000
ISO 9001:2000 ◼ Currently under audit ◼ Certification due November 2006.
Slide 8: BBBEE Certification
BBBEE CERTIFICATION ◼ Rating: “Non BEE-Limited Contribution”. ◼ Investment in Staff Training. ◼ Launched Bursary Scheme in conjunction with Reunert College for 2 persons. ◼ Investment in Corporate Social Investment via Nashua Franchises.
Slide 9: Competition
COMPETITION ◼ ABSA Technology Finance (Union) ◼ Sasfin ◼ Merchant West ◼ Technofin ◼ Nefco
Slide 10: Credit Vetting
CREDIT VETTING ◆ Investment in a new system written by Acuo, a Reunert company. ◼ Enhanced scorecard model. ◼ More user friendly. ◼ Web based design. - give an online effect for major customers. ◼ Improved exception reporting. ◼ Improved Data Base management.
Slide 11: Business Model
BUSINESS MODEL ◼ Nashua Finance ◼ RC&C Finance
Slide 12: Nashua Finance
NASHUA FINANCE Existing Model ◼ Bill to franchise. ◼ Franchise collects rentals as an agent. ◼ Recourse risk taken by the franchise. ◼ Best rates available. ◼ Perform regular franchise reviews. ◼ For Nashua and some Panasonic.
Slide 13: RC&C Finance
RC&C Finance ◼ Bill Direct to end user. ◼ We collect directly. ◼ Finance company takes the credit risk. ◼ Rates competitive with opposition product. ◼ No franchise review procedure necessary. ◼ For Panasonic, Siemens and ……
Slide 14: Funding
FUNDING ◼ Overnight Funds from Shareholders. ◼ Fixed Rate deals backed by fixed funding. ◼ Utilise Swaps to fix margin on fixed rate deals. ◼ Swaps matched to the expected life of the deal.
Slide 15: Interest Rates
INTEREST RATES ◼ Historically rates have been much higher. ◼ Volumes not expected to drop much. ◼ Reduces temptation to rollover base. ◼ Margins are managed. ◼ Fix where necessary. ◼ No material effect expected.
Slide 16: Base Analysis (Cont'd)
BASE ANALYSIS (Cont’d) ◼ Approx’ 10,000 End users. ◼ Approx’ 55,000 contracts. ◼ Largest End user 1.2% of total base. ◼ Top 50 End users = 20% of total base. ◼ Top 50 Geographically spread throughout SA ( Mainly Gauteng and Western Cape).
Slide 17: Statistics - Credit
STATISTICS - CREDIT ◼ Credit Vet average 1,488 applications pm. ◼ Approval ratio 75% (average). ◼ Discount average 1515 contracts. ◼ Turnaround times. ⧫ Average 8h04 ⧫ Existing Users 6h56 ⧫ New Users 12h36
Slide 18: Exchange Rates
EXCHANGE RATES ◼ Direct : No effect. - No imports. - No exports. ◼ Indirect: - Potential slowdown in dealer business. - Increase prices, increase payout values.
Slide 19: Base Analysis
BASE ANALYSIS Own Book Sold Book Total Value 1,323,848 151,684 1,475,532 (R’000s) Average 36 months 14 months 30 months period to run
Slide 20: Base Analysis (Cont'd)
BASE ANALYSIS (Cont’d) ◼ Fixed Rentals. 77% ◼ Linked to Prime Rentals. 23% ◼ Coverage of Fixed Deals. 77% ⧫ Equity Cover 16% ⧫ Swaps 84%
Slide 21: Statistics - Ratios
STATISTICS - RATIOS 2002 2003 2004 2005 2006 Return on 30% 5% 52% 49% 57% Equity Cost to 16% 18% 9% 11% 11% Revenue Return on 3% 0% 10% 3% 3% Assets Bad Debts 0.5% 0.9% 0% 0% 0%
Slide 22: Thank You
THANK YOU