Segmental analysis

 
 

Business segments

The adoption of IFRS 8 Operating Segments during the financial year has resulted in an operating segment “Other” being added to the segmental disclosure. Comparative information has been amended accordingly.

The segments identified are Electrical Engineering, operating as CBI-electric; Information and Communication Technologies (ICT) operating as Nashua; Defence operating as Reutech; and Other. The segments have been identified based on products, technology, services, markets and customer segmentation.

CBI-electric encompasses the design, manufacture, installation and maintenance of a complete range of power cables, the manufacture and supply of copper and optical fibre telecommunication cable, the manufacture and supply of low-voltage distribution-, protection- and control equipment and the supply of high- and medium-voltage switchgear and transformers. The market here includes municipalities, parastatals, utilities, mining industry and the building industry.

Nashua is a provider of communication services and solutions; a provider of telecommunications solutions; a distributor of business systems products focusing mainly on office automation and telecommunications; a provider of voice communications and telecommunications and data networking solutions. In addition, the segment provides asset-based financial solutions to Reunert’s associated office automation suppliers. The market here is corporate and retail customers, government and parastatals.

Reutech specialises in tactical VHF/UHF communication systems, designs and manufactures fuses and related defence products for artillery, mortar, naval and aircraft weapon systems, develops and manufactures ground and naval search and tracking radar systems and designs and manufactures mining radar sensor systems used in open-cast mining. In addition, this segment manufactures and supplies remote-controlled weapon platforms and supplies system engineering and logistic support services in telecommunications, radar, satellite, mining, fare management and transportation fields. Markets here are local and international defence forces and mining houses.

The Other segment is made up of the group administration function and the property portfolio in the group. Revenue is the external rentals received on property rentals.

The group’s operations are situated mostly in South Africa with operations in Australia, Germany, Lesotho, USA and Zimbabwe. The revenue and profits for these various geographical regions are not material and it would not be meaningful to disclose this information.

Customers and grouping of customers are diverse and Reunert does not have a single customer or grouping of customers which meets the requirements to be separately disclosed in terms of IFRS 8 Operating Segments.

Revenue  

  2010 2009 %  
  Rm   %   Rm   %   change  
CBI-electric   2 961,3   28   2 952,2   29   —  
Nashua   6 872,0   65   6 331,5   62   9  
Reutech   791,0   7   904,3   9   (13) 
Other   2,7   —   2,8   —   (4) 
Total operations   10 627,0   100   10 190,8   100   4  
NSN   52,9     80,0     (34) 
Revenue as reported per the income statement   10 679,9     10 270,8     4  
Intersegment revenue is immaterial and has not been disclosed.  
           

Operating profit before interest, dividends and abnormal items  

  2010 2009 %  
  Rm   %   Rm   %   change  
CBI-electric   521,1   45   419,3   39   24  
Nashua   614,5   52   518,0   48   19  
Reutech   60,6   5   223,1   20   (73) 
Other   (25,5)  (2)  (74,4)  (7)  66  
Total operations   1 170,7   100   1 086,0   100   8  
NSN   52,9     54,4     (3) 
Operating profit before interest, dividends and abnormal items as reported in the income statement   1 223,6     1 140,4     7  
           
           
Total assets         2010  
Rm  
2009  
Rm  
CBI-electric         1 494,8   1 400,8  
Nashua         3 595,4   3 574,5  
Reutech         659,7   601,0  
Other1         2 202,9   2 121,1  
Total assets as reported per the balance sheet         7 952,8   7 697,4  
1 Included in Other are bank balances of R1 207,6 million (2009: R1 154,8 million) because group administration manages the treasury function.      
           
Inventory and contracts in progress        
CBI-electric         424,1   329,6  
Nashua         305,5   245,9  
Reutech         133,7   120,7  
Other         —   —  
Total inventory and contracts in progress as reported per the balance sheet   863,3   696,2  
Other accounts receivable            
CBI-electric         471,6   467,2  
Nashua         1 025,9   893,1  
Reutech         153,4   195,8  
Other         49,9   68,5  
Total other accounts receivable as reported per the balance sheet         1 700,8   1 624,6  
Trade and other payables, derivative liabilities and provisions        
CBI-electric         422,4   352,5  
Nashua         1 228,8   1 043,6  
Reutech         151,5   225,7  
Other         134,0   141,5  
Trade and other payables, derivative liabilities and provisions as reported per the balance sheet   1 936,7   1 763,3  
Capital expenditure        
CBI-electric         23,1   39,7  
Nashua         44,3   14,4  
Reutech         31,6   31,6  
Other         49,9   1,4  
Capital expenditure as reported   148,9   87,1  
Depreciation and impairment of property, plant and equipment and amortisation of intangible assets        
CBI-electric         52,4   41,4  
Nashua         49,9   44,1  
Reutech         15,3   10,2  
Other         0,7   0,7  
Depreciation and impairment of property, plant and equipment and amortisation of intangible assets as reported   118,3   96,4  
           
Number of employees         2010   2009  
CBI-electric         2 908   2 745  
Nashua         2 545   2 295  
Reutech         917   1 228  
Other         52   53  
Number of employees as reported         6 422   6 321