4.0 - Imperial
4.0 - Imperial
4.0 - Imperial
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company Overview<br />
Chairman’s report<br />
for more information please visit<br />
www.imperial.co.za/ar2009/operational/vehicle.asp<br />
ceo’s report<br />
Operational reviews<br />
financial Directors Report<br />
sustainability report<br />
corporate governance<br />
Highlights<br />
• New flagship dealerships performed<br />
well<br />
• Revenue from services higher<br />
despite decline in total revenue<br />
• Dealer portfolio constantly being<br />
improved through rationalisation and<br />
modest expansion into areas offering<br />
better trading prospects<br />
Macro drivers<br />
• Economic growth<br />
• Interest rates<br />
• Consumer confidence<br />
• Foreign exchange rates<br />
• OEM performance<br />
• Regulatory landscape<br />
Risks<br />
• Ability to source and retain<br />
skilled individuals<br />
• Exchange rate<br />
• Market exposure to interest<br />
rates<br />
• Availability of consumer credit<br />
Performance drivers<br />
• New vehicle sales<br />
• Cost containment and<br />
overhead absorption<br />
• Sale of value-added products<br />
• Working capital management<br />
Strategies<br />
• Expand used vehicle sales<br />
• Improve customer satisfaction<br />
• Maintain good relations with<br />
our suppliers and customers<br />
New flagship dealerships generally performed<br />
well. Importantly, and in line with the group<br />
strategy, revenue from rendering services<br />
increased by 8% against a decline of 13% in<br />
total revenue.<br />
We view the operating margin of 1,7% as<br />
acceptable under the circumstances.<br />
The main driver behind the recent slump in<br />
vehicle sales has been reduced lending by<br />
vehicle finance banks and, to a lesser extent,<br />
reduced demand. Recent rate cuts have not<br />
provided much relief yet, as banks increased<br />
their lending margins to compensate for<br />
liquidity constraints and to price correctly for<br />
risk following increased credit losses in their<br />
vehicle finance books.<br />
by 59% to R29 million. Trading conditions in<br />
the United Kingdom are expected to remain<br />
tough for the foreseeable future.<br />
Jurgens recorded a loss due to a significant<br />
decline in consumer spending on leisure<br />
items, while Beekman Canopies performed<br />
very well in a market where light commercial<br />
sales were significantly lower.<br />
The LDV franchise in the United Kingdom was<br />
closed following the insolvency of the LDV<br />
manufacturer. No further impairment charges<br />
are required. Operating profit from the DAF<br />
truck dealerships in the United Kingdom and<br />
the Nissan dealerships in Sweden declined<br />
imperial holdings limited Annual Report 2009 25
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