Bid Corporation Limited

Bidcorp reported 5% constant-currency revenue growth for the year, trading profit up 8.2% in constant currency, and HEPS up nearly 7% in constant currency. David Cleasby said free cash flow was ZAR 7 billion, net debt to EBITDA was 0.2x, the final dividend was ZAR 6.25 per share, and currency volatility reduced results by 1.4%. He also said gross profit rose 30 basis points, the cost of doing business increased only slightly from 19% to 19.1%, and trading profit margins improved even though emerging markets were flat and Australasia declined slightly. Looking ahead, management said capital investment should moderate to 1.5% to 2% of sales, working capital should normalize around 5 to 7 days, and the company is budgeting for continued growth into FY2027.

Bernard Berson emphasized consistency, decentralized execution, and organic growth as the core of the story. He said the business is not dependent on acquisitions, with plenty of room to grow revenue, margins, and efficiency through house brands, vertical integration, technology, and better operations. His tone was confident and pragmatic: he acknowledged volatility, war impacts, and weak macro conditions, but said the group is strongly cash generative, well capitalized, and on the right path.

David Cleasby focused on the quality of earnings and cash generation, saying the story is 'all about the cash.' He highlighted ZAR 7 billion of free cash flow, working capital generation of nearly ZAR 500 million versus a ZAR 800 million absorption a year ago, net working capital days improving from 8 to around 5, and working capital to revenue at 2.8% versus 3.5% previously. He also noted net debt at ZAR 3.8 billion, a 0.2x net debt-to-EBITDA ratio, foreign borrowing costs averaging 3.4%, a tax rate guided at 26% to 27%, and buybacks of about 1% of shares in issue. Capital spending is expected to normalize at 1.5% to 2% of sales, with management balancing reinvestment against returns to shareholders.

Analysts focused on acquisition appetite, capital allocation, food inflation, working capital, EV economics, and regional growth trends. Management said attractive acquisitions are still limited, but it is looking at a few bolt-ons, while continuing buybacks if the share price remains depressed and increasing dividends over time. They said food inflation remains low, with 2% to 3% described as the sweet spot, and that the business can usually pass through modest inflation because of its customer mix. On EVs, management said higher fuel prices improve the economics, but charging infrastructure and battery-life uncertainty remain constraints. They also reiterated that the 6% sales growth seen in the first 8 weeks of the new year suggests momentum is continuing.