Capital Equipment and related parts and services (“CE”)


CE consists of businesses previously reported under the CEG segment that sell capital equipment, spare parts and provide the related services to the earthmoving, construction, mining and logistics industries.

The year under review will be the first full year of trading without the agricultural companies sold to CNHi last year. The remaining companies have performed well and have produced excellent results.

Demand for, and sales of earthmoving equipment continued to decline because of high price increases from factories, resulting in customers extending the life of their equipment. This has resulted in a significant increase in the demand for spare parts. Spare parts coverage and inventory holdings were accordingly increased to accommodate the extended lead times and to ensure availability, which helped to improve the aftermarket services provided to customers.

The forklift market has shown modest signs of an upturn in activity. Sales volumes have been consistent year-on-year and, there is a continuous programme to refresh units in the rental fleet, to ensure low operating costs and continued profitability of this part of the business.

Spare parts sales have shown remarkable growth in the OEM market and continue to do so. Spare parts contribute a significant part of the annual gross profit of this segment.

Due to the reluctance of the banks to provide asset-based finance, we have continued to provide short- and long-term finance to customers, building on our existing asset finance book to stimulate

sales and assist customers, without taking undue risk.


In respect of the year under review:

> Revenue of CE increased by 16.8%, from R909.4 million to R1.06 billion

> Sustainable operating profit increased by 2.8% from R108 million to R111.7 million, after adjustments for impairments and once-off items

> The net operating assets in this segment were R384 million and the return on net operating assets was 29.1%