IMPERIAL Logistics expansion into Africa Macquarie First South Securities 3rd Annual Logistics Tour

1. OUR EXPANSION INTO AFRICA
Macquarie First South Securities
3rd Annual Logistics Tour
28 November 2012
Cobus Rossouw

2. IMPERIAL LOGISTICS REVENUE

3. OUR AFRICAN FOOTPRINT

4. RTT SERVICE PARTNERSHIPS

5. 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 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

9. 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 Building IP
Chasing FMCG growth Reporting and Point of Sale
Consumers conversion Partners in profit
COMPLIMENTED WITH
Value proposition (stakeholders) Proactive route to market DEMAND CREATION
Unique selling proposition (customers) Intelligence for bottom-of-the-pyramid SERVICES

10. LESSONS LEARNT
Forex surprises
No ‘1-size fits all’
Due diligence complexities
Related party arrangements
Complex entrepreneurial structures
Land ownership in African countries
No pipeline of qualified quality people

11. 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
Start-up businesses very difficult, costly and time
sensitive
Thus not part of our model which is focussed on
acquisitions

12. CHALLENGES
Taxation
Corruption
Governance
Legislation complexities
Infrastructure deficiencies
Foreign exchange rate risk

13. CHALLENGES
Cultural fit and Africanisation
Limited suitable opportunities
Shareholder return expectations
High price expectations on acquisitions
Limited sypply of qualified human resources

14. IMPERIAL LOGISTICS AFRICA 3 YEARS FORWARD
Africanisation
Country consolidation
Zambia node established
Pull dominant over push
Unique selling proposition
Integrated value proposition
Customer one answer in Africa
Angola

15. 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 &
manufacturers
Create China/Africa partnership to assist with
Angola
Imperial Logistics Confidential

16. QUESTIONS?

18. 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.

19. IMPERIAL GROUP IN PERSPECTIVE

21. IMPERIAL LOGISTICS AFRICA

22. 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

23. CHANGING ROLE OF THE
LOGISTICS SERVICE PROVIDER

24. OUR SERVICE OFFERINGS

25. 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)
• Supply Chain Capability development
(Design & Manage)
• SOP process & structure
• WHs process innovation
• Transport fleet configuration
• Inventory planning & modelling
• Procurement strategy
• Technology enablement / Visibility Modelling

26. INFORMATION TECHNOLOGY SOLUTIONS

27. INFORMATION TECHNOLOGY SOLUTIONS

28. PEOPLE ALIGNMENT

29. ENGINEERING LOGISTICS

30. LOGISTICS MANAGEMENT

31. 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

32. COMMITTMENT TO SUSTAINABLE TRANSPORT
Improving our environmental footprint through the adoption of these principles.

33. COMMITTMENT TO CSI

34. 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
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

35. INDUSTRY ASSOCIATIONS MEMBERSHIPS

36. 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
professional driver permits)
Driver training (e.g. duty of driver in event
of accident, accident reports)
Road Transport Management System

37. 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
year
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.