OUR EXPANSION INTO AFRICAMacquarie First South Securities

3rd Annual Logistics Tour

28 November 2012

Cobus Rossouw

IMPERIAL LOGISTICS REVENUE

OUR AFRICAN FOOTPRINT

RTT SERVICE PARTNERSHIPS

3 PILLARS TO OUR STRATEGY

Invest heavily in developing corridors between neighbouring

countries in Southern Africa so that product flows efficiently

from neighbouring country to country

Assist clients in benefiting from the mass consumerisation of

Africa through our integrated value offering in the FMCG and

Pharmaceutical spacePharmaceutical space

Explore supply chain partnerships and advisory opportunities

with both existing and potential clients to identify potential

solutions that can be offered to these clients in Africa

OUTSOURCED SALES: CIC

Wholly owned by Imperial Logistics, CIC Holdings operates

within the FMCG Industry through agency agreements with

both local and international manufacturers

The Group currently operates in 9 African countries, including a

footprint of 18 sites across the continent and > 10,000 staff

Building brands and creating the demand

Chasing FMCG growth

Consumers conversion

Value proposition (stakeholders)

Unique selling proposition (customers)

Building IP

Reporting and Point of Sale

Partners in profit

Proactive route to market

Intelligence for bottom-of-the-pyramid

COMPLIMENTED WITH DEMAND CREATION

SERVICES

LESSONS LEARNT

Forex surprises

No ‘1-size fits all’

Due diligence complexities

Related party arrangements

Complex entrepreneurial structuresComplex entrepreneurial structures

Land ownership in African countries

No pipeline of qualified quality people

LESSONS LEARNT

Over-reliance on the sellers as managers

Centralisation of accounting and reporting

Sellers made use of external consultant who was

obstructive

Over anxious for deals Over anxious for deals

Start-up businesses very difficult, costly and time

sensitive

Thus not part of our model which is focussed on

acquisitions

CHALLENGES

Taxation

Corruption

Governance

Legislation complexities

Infrastructure deficienciesInfrastructure deficiencies

Foreign exchange rate risk

CHALLENGES

Cultural fit and Africanisation

Limited suitable opportunities

Shareholder return expectations

High price expectations on acquisitions

Limited sypply of qualified human resourcesLimited sypply of qualified human resources

IMPERIAL LOGISTICS AFRICA 3 YEARS FORWARD

Africanisation

Country consolidation

Zambia node established

Pull dominant over push

Unique selling proposition

Angola

Unique selling proposition

Integrated value proposition

Customer one answer in Africa

IMPERIAL LOGISTICS AFRICA 3 YEARS FORWARD

50% less reliance on South Africa

Competitive “Africa” fleet of trucks

Africa manufacturers’ preferred partners

Asset light service offering 4PL (Sub Base)

Partner with global, local and SA retailers &

Angola

Partner with global, local and SA retailers &

manufacturers

Create China/Africa partnership to assist with

Imperial Logistics Confidential

QUESTIONS?

IMPERIAL GROUP IN PERSPECTIVE

The IMPERIAL Group is founded on five strategic pillars:

IMPERIAL was established in 1975 and is a diversified industrial services and retail group. We operate in South Africa, Africa and Europe with an extensive global reach.

IMPERIAL, listed on the JSE, operates a decentralised management structure that actively encourages entrepreneurship, innovation and encourages industry best practice.

IMPERIAL GROUP IN PERSPECTIVE

IMPERIAL LOGISTICS AFRICA

OUR POSITIONING

We improve our clients’ competitiveness

through customising our experience

in outsourced supply chain and logistics

Combining consistent fundamentals and tangible value add, we supply logistics and

supply chain management from a single source

CHANGING ROLE OF THE

LOGISTICS SERVICE PROVIDER

OUR SERVICE OFFERINGS

ADVISORY SERVICES

• Market assessment

• Business plan development

• Customer profitability assessment

(Revenue – Cost 2 process + Cost 2 serve)

• Route to market strategy

• Intermodal strategy (Port, Rail, Road)

• Network configuration (Local, International)

• SOP process & structure

• WHs process innovation

• Transport fleet configuration

• Inventory planning & modelling

• Procurement strategy

• Technology enablement / Visibility Modelling

• Network configuration (Local, International)

• Supply Chain Capability development

(Design & Manage)

INFORMATION TECHNOLOGY SOLUTIONS

INFORMATION TECHNOLOGY SOLUTIONS

PEOPLE ALIGNMENT

ENGINEERING LOGISTICS

LOGISTICS MANAGEMENT

COMMITTMENT TO B-BBEE

B-BBEE is a strategic imperative

IMPERIAL Logistics is classified as a Level 3

contributor with a significant Value Add

Supplier Status

This translates to a 137.5% Procurement

Spend Recognition from IMPERIAL Logistics

We will continue to pursue and promote all

facets of empowerment in our businesses

COMMITTMENT TO SUSTAINABLE TRANSPORT

Improving our environmental footprint through the adoption of these principles.

COMMITTMENT TO CSI

COMMITTMENT TO SKILLS DEVELOPMENT

During 2011 we spent over R55m on skills development - 75% black employees and 25% black females

IMPERIAL Learning Centre works with SETA’s, internal experts and accredited providers and has string relationships with tertiary bodies and academic institutions

Our Fast Forward programme takes a practical approach to addressing the skills gap - from facilitating workplace entry and tertiary education support to gap - from facilitating workplace entry and tertiary education support to research

In 2012, the IMPERIAL Programme for Supply Chain and Logistics at GIBS was launched

The programme will elevate the visibility of supply chain management and position supply chain management as a career of choice for professionals

INDUSTRY ASSOCIATIONS MEMBERSHIPS

COMMITTMENT TO SAFER ROADS

Each of our operating companies is

responsible for compliance with the

National Road Traffic Act

Registration of vehicle operator

Fitness of vehicles (registration, licensing

and roadworthy certificates)

Fitness of drivers (driver's licenses and Fitness of drivers (driver's licenses and

professional driver permits)

Driver training (e.g. duty of driver in event

of accident, accident reports)

Road Transport Management System

COMMITTMENT TO SAFER ROADS

1 in every 3 car rental transactions is

made through IMPERIAL

1 in every 4 cars sold in SA is through

IMPERIAL

IMPERIAL’s southern Africa transport

fleet travelled 460 million kms last

yearyear

With so many of our vehicles on the

road, IMPERIAL embarked on an exciting

campaign to make our roads safer - one

pledge at a time.