finance 2008 new

8/14/2019 Finance 2008 New

1/16

EEMEA Country ReviewEEMEA Country Review

DHL ZambiaDHL Zambia

04/12/200704/12/2007

Financial Performance

8/14/2019 Finance 2008 New

2/16

Page 2EEMEA Country ReviewEEMEA Country Review


04/12/200704/12/2007

Finance Management Team

Finance Manager

Link Jongwe

Duties Accountant

Frank Kondowe

CA Manager

Mulenga Mumbi

Financial Controller

TBA

Billing Supervisor

Aaron Mwale

Accountant DGF

Sylvester Kasepa

Management Acct

Michelo Mwiinde

Financial Acct

Steven Chilufya

8/14/2019 Finance 2008 New

3/16



04/12/200704/12/2007

Political, Social Country Macro Environment.

1 Political

* National Day: 24th October 1964. Politically Stable.

* State & Govt Government: The Republican President and his/her appointed cabinet.

* Legal System: Based on English Common Law and Customary Law.

* Legislature: National Assembly- comprising158 members of parliament.

* Judiciary: An independent Judiciary headed by the Chief Justice

* Political System: Multiparty Democracy.

* Ruling Party: The Movement for Multiparty Democracy (MMD)

2 Social Factors

* Population: 11,089,691 (2005 est.)* Population Growth Rate: 2.11% (2006 est)

* Birth Rate: 41births/ 1,000 (2006 est)

* Death Rate: 19.93 deaths/ 1,000 population (2006 est)

* Infant Mortality Rate: 95 deaths/ 1,000 live births

* Life expectancy at birth : 50yrs

* Languages: Main English. Local dialects Bemba, Tonga, Nyanja, Lozi, Luvale, Lunda.

* Literacy: Total population 55%

* Land Use: Arable land: 60 million hectares, only 15% cultivated.

* HIV%:adult prevalence of about 16.5%. National Strategic Plan formulated wth 50% target for antiretiviral therapy 2002-2007

8/14/2019 Finance 2008 New

4/16



04/12/200704/12/2007

Economic Country Macro Environment.

3 Economic

Currency: Zambian Kwacha (ZMK) = 100 Ngwee.

Key Statistics:

Year

GDP

(US $ m)

Real GDP

growth

rate, %

GDP per

capita,

USD

Inflation

rate, %

Capital

account of

balance of

payments

(US $ m)

Average

exchange

rate:

ZMK to

USD

Foreign

exchange

reserves

expressed

in terms

of months

of import

cover

Total

external

debt

service

as % of

exports

Central

bank

discount

rate (end

of year),

%

Prime

lending rate

(average for

year),

%1999 3,132 4.9 307 20.6 153 2388 0.5 14.7 46.2 40.3

2000 3,239 3.7 315 30.1 153 3111 1 15.7 44.1 39.1

2001 3,640 4.9 347 18.8 222 3608 0.8 13.1 52.5 45.8

2002 3,776 3.3 350 26.7 236 4307 2.1 10.9 34.0 45.3

2003 4,318 5.1 389 17.2 240 4743 1.3 14.6 20.2 40.5

2004 5,448 5.4 491 17.5 239 4772 1.2 18.3 18.3 30.9

2005 7,269 5.0 655 15.9 2080 4464 1.6 6.7 17.1 28.2

Other Stats:

* Unemployment rate: 50%

* Poverty: 68% of Zambia Live below Recognised Poverty Datum Line of K1,081,332 ($270) per month for an ave family of 6

Commodity & Sectoral Performance:

* Main Exports: Copper, Cobalt, Electricity, Tobacco, Cotton

* Main Imports: Machinery, Clothing, Fertilizer, Petroleum

* Mineral Production (Metric Tonnes) Commodity Prices

Period

Copper

Export

Copper

Production

Cobalt

Export

Cobalt

Production Period

Copper

US $/lb

Cobalt

US $/lb

(Mt) (Mt) (Mt) (Mt)

Jan-Sep Jan-Sep

2005 302,259 316,237 4,183 4,267 2005 1.58 13.51

2006 368,883 382,766 3,626 3,639 2006 2.99 13.13

2007 337,863 365,030 3,232 3,266 2007 3.22 24.20

* Main Growth Sectors: Mining & Civils, Agriculture, Construction, Manufacturing & Tourism

8/14/2019 Finance 2008 New

5/16



04/12/200704/12/2007

Profit and Loss Statement - YTD

Functional Profit & Loss YTD vs. Budget.

in EUR'000 @ AOP ACT vs 8+4Fct 8+4 Fct* vs Bud BUD vs PY PY

Third Party Revenue 4,594 6.0% 4,335 20.2% 3,608 24.2% 2,905

Total Revenue 4,883 5.9% 4,613 18.4% 3,895 20.6% 3,230

Direct Functions 2,049 2,007 1,760 1,391

Gross Profit 2,835 8.8% 2,605 22.0% 2,136 16.1% 1,839

Indirect Functions w/o IT Central Charge 2,442 2,311 1,608 1,778

Bad Debts 23 39 128 81

IT Central Charge 52 55 72 50

Other Costs 877 755 394 305

EBIT Before Overhead (560) -0.9% (555) -737.0% (66) 82.3% (375)

Total Overhead (167) (236) (304) (201)

Aggregated EBIT after Overhead (727) 8.1% (791) -113.9% (370) 35.8% (576)

in 000' EUR @ AOP ACT vs 8+4 Fct 8+4 Fct* vs Bud BUD vs PY PY

Gross Profit in % Revenue 58.05% 1.57% 56.48% 1.65% 54.83% -0.45% 56.93%

Indirect and Other Costs in % Revenue 72.25% 1.53% 70.73% 15.25% 55.48% -0.98% 71.71%

Indirect Costs in % Revenue 50.01% -0.10% 50.11% 8.82% 41.29% -4.95% 55.05%

IT Central Charge in % Revenue 1.07% -0.13% 1.20% -0.65% 1.85% -0.34% 1.54%

Other Costs (incl.OH) in % Revenue 17.97% 1.59% 16.37% 6.27% 10.10% 6.93% 9.44%

EBIT after Overhead in % Revenue -11.47% 0.57% -12.04% -10.33% -1.70% -0.44% -11.60%

Billed Shipments 88,710 3.34% 85,845 -0.10% 85,929 22.06% 70,329

Billed Weight 202,744 3.23% 196,392 13.05% 173,715 46.14% 134,386

Direct cost per shipment (Total) 23.09 -1.24% 23.38 14.20% 20.48 18.21% 19.78

Revenue per shipment (Billed Third party) 34.53 -0.17% 34.59 -1.59% 35.15 6.74% 32.41

DSO 18.02 -1% 18.23 -48% 35.16 -2% 18.66

October 2007 Year-to-Date

October 2007 Year-to-Date

Key Performance Indicators - Express EEMEA Express

8/14/2019 Finance 2008 New

6/16



04/12/200704/12/2007

Business Growth

Revenue Drivers

Tariff Rationalisation Retail Focus

Restructure of Commercial Infrastructure Development

Revenue & Business Growth Summary

2007 vs Budget Budget vs 2006 2006

DOX 917 -21% 1,157 -3% 945

WPX 620 8% 577 73% 358

IMPEX 761 44% 528 66% 458

Time Definite Int'l Billed 2,298 2% 2,261 31% 1,761

Other International 108 100% 0 844% 11

Domestic 243 -9% 269 8% 224

DGF 1,531 160% 588 145% 626TOTAL 3rd Party- Revenue (Eur'000 @ AOP) 4,594 27% 3,608 58% 2,905

Shipments- DOX 32,682 1% 32,277 28% 25,528

Shipments- WPX 3,488 -10% 3,890 57% 2,217

Shipments- IMPEX 3,590 -2% 3,655 47% 2,445

Time Definite Int'l Billed- Shipments 39,760 0% 39,822 32% 30,190

Shipments- Domestic 48,950 6% 46,107 22% 40,139

TOTAL 3rd Party- Shipments 88,710 3% 85,929 26% 70,329

Weights- DOX 20,352 -9% 22,270 28% 15,911

Weights- WPX 53,272 46% 36,564 115% 24,784

Weights- IMPEX 63,151 38% 45,716 65% 38,276

Time Definite Int'l Billed- Weights 142,259 36% 104,550 80% 78,970

Weights- Domestic 60,489 -13% 69,165 9% 55,417

TOTAL 3rd Party- Weights 202,749 17% 173,715 51% 134,386

October YTD

8/14/2019 Finance 2008 New

7/16



04/12/200704/12/2007

Functional Profit & Loss YTD - Explained.in EUR'000 @ AOP Actuals vs Budget Budget

Third Party Revenue 4,594 27.3% 3,608

Total Revenue 4,883 25.4% 3,895

Direct Functions 2,049 16.4% 1,760

Interco Trans:L/H chargeback VAR vs Bud 201

L/H c/back rate, Act eur7.28/kg vs bud 6.94/kgL/H billed kilo's Incr., Act 127,246kg vs Bud 104,550kg

Repairs Ops M/V 25

Fuel: Incr in consp frm business grwth, routing, vol. 13

Price Changes, Act 1.79eur vs Bud 1.24eur 84

7

330

1,719 -2.3% 1,760

Gross Profit 2,835 32.7% 2,136

Indirect Functions w/o IT Central Charge 2,390 48.6% 1,608

Personnel: Area Commercial 106

Separation Costs 119Additional FTE's, including recruitment 128

First Coice bonus 17

Rent& Lease: Area Comm. M/V rentals 17

New Offices & Gateway 22

Rental Increases 8

T&E: Area Commercial 52

Training (Crest,Collect,CSV,ROS,PCSCL,S/chain,COMET,DG) 29

Customer Calls (Copperbelt, Livingstone, North Western) 18

AP&P: Tariff Related Comms- Print & Media 12

Customer Events 6

Product & Trade Lane Promo's 3Settlement- Clear Channel vs DHL 17

Social Responsibility (Donations, Sponsorships, Welfare) 10

Legal: Settlements old cases:

ABC vs DHL, staff related 13

Mulenga Mundashi & Associates- H/O Lease Agreement 6

Comms: Data: New Link(NDL-KIW) & Upgrade(Vsat & Terrestrial Link). 18

Higher usage (Business expansion, new offices & Area related) 36

638

1,752 8.9% 1,608

Bad Debts 23 -81.9% 128

IT Central Charge 52 -27.9% 72

Other Costs/ DGF 877 122.9% 394

Freight DGF 294

Personnel DGF 88

Rent & Lease 14

Travel DGF 21

Finance Charges DGF: Transit Bonds 9

425

452 14.9% 394

Total Costs 5,391 36.1% 3,962

EBIT Before O/H Allocations (508) -666.0% (66)

Total Overhead (219) -27.9% (304)Aggregated EBIT after Overhead (727) -96.5% (370)

October 2007 YTD

Ops 3rd prty Handing Chgs- H&D RIT's NLA Gtw- FQM

8/14/2019 Finance 2008 New

8/16



04/12/200704/12/2007

Profit and Loss Statement - YTDFunctional Profit & Loss Quarterly Evolution

in 000' EUR @ AOP

Q1 Q2 Q3 Q4 10+2 BudgetPrior

YearFct 8+4 Q1 Q2 Q3 Q4 10+2 BUD

EEMEA

FC

0+12

ASIA

FC

0+12

Third Party Revenue 1,151 1,343 1,378 1,708 5,579 4,436 3,499 5,321

Total Revenue 1,229 1,430 1,468 1,794 5,921 4,779 3,893 5,650

Direct Functions 471 655 719 619 2,464 2,149 1,748 2,423 38% 46% 49% 35% 42% 45% 54% 66%

Gross Profit 758 775 749 1,175 3,457 2,630 2,145 3,227 62% 54% 51% 65% 58% 55% 46% 34%

Indirect Functions w/o IT Central Charg 848 746 588 516 2,697 1,930 2,163 2,618 69% 52% 40% 29% 46% 40% 23% 19%-7 30 -1 17 39 156 140 55 -1% 2% 0% 1% 1% 3% 1% 0%

13 17 16 21 66 87 57 70 1% 1% 1% 1% 1% 2% 1% 0%

Other Costs 292 283 117 351 1,043 472 417 921 24% 20% 8% 20% 18% 10% 8% 3%

Total Costs 1,618 1,730 1,439 1,524 6,310 4,794 4,524 6,087 132% 121% 98% 85% 107% 100% 86% 88%

EBITA Before O/H Allocations -389 -300 29 270 -389 -15 -632 -436 -32% -21% 2% 15% -7% 0% 17% 12%

Overheads -40 -94 -62 -66 -262 -399 -230 -280 -3% -7% -4% -4% -4% -8% -1% -5%

EBIT after Overheads -429 -394 -33 204 -652 -414 -862 -716 -35% -28% -2% 11% -11% -9% 15% 11%

Key Performance Indicators

Q1 Q2 Q3 Q4 10+2 Budget

Prior

Year Fct 8+4

Gross Profit in % Revenue 62% 54% 51% 65% 58% 55% 55% 57%

Indirect Costs in % Revenue 69% 52% 40% 29% 46% 40% 56% 46%

IT Central Charge in % Revenue 1% 1% 1% 1% 1% 2% 1% 1%Other Costs in % Revenue 24% 20% 8% 20% 18% 10% 11% 16%

EBIT after Overhead in % Revenue -35% -28% -2% 11% -11% -9% -22% -13%

Billed Shipments 24,107 25,351 28,607 28,371 106,436 105,231 85,090 103,571

Billed Weight 43,234 64,373 68,483 68,577 244,667 212,994 172,505 240,107

Direct cost per shipment (Total) 19.55 25.82 25.14 21.82 23 20 21 23

Revenue per shipment (Billed Third part 31.49 33.86 35.28 40.31 35.43 35.38 32.23 35.50

DSO 23.84 15.77 15.22 19.17 18.02 35.16 18.66 18.23

IT Central Charge

% to Revenue

Bad Debts

2007

Quarterly Fct 10+2 Full Year 2007

8/14/2019 Finance 2008 New

9/16



04/12/200704/12/2007

Zambia Express/DGF split (restated

AOP)

in EUR'000 @ AOP

Actuals BudgetPrior

Year

Fct

8+4

VAR

Bud

VAR

Prior

Year

VAR

FC

8+4

Actuals BudgetPrior

Year

Fct

8+4

VAR

Bud

VAR

Prior

Year

VAR

FC

8+4

Consolidated

Total Revenue 756 439 351 530 317 405 227 4,883 3,895 3,230 4,613 988 1,653 271

EBITA Before O/H Allocations 151 25 -118 60 126 -270 92 -508 -66 -375 -555 -442 133 47EBITA % Revenue 20% 6% -34% 11% -10% -2% -12% -12%

Express

Total Revenue 470 376 268 379 94 202 202 3,352 3,307 2,604 3,246 45 748 106

EBITA Before O/H Allocations 50 1 -157 -7 49 -206 206 -1,162 -261 -696 -1,166 -901 466 4EBITA % Revenue 11% 0% -58% -2% -35% -8% -27% -36%

DGF

Total Revenue 286 63 83 150 223 203 203 1,531 588 626 1,366 943 905 165

EBITA Before O/H Allocations 102 24 38 67 78 -64 64 654 194 321 611 459 -332 43

EBITA % Revenue 35% 38% 46% 44% 43% 33% 51% 45%

Month - October 07 Year To Date

8/14/2019 Finance 2008 New

10/16



04/12/200704/12/2007

Top 10 customers Over 60 days

Eur@AOP Customer Name Over 60 Balance% of Total Countryover 60days AR

Stop CreditY/N

1 Konkola Copper Mines 26,914.39 2.91% N

2 Luanshya Copper Mines 8,801.99 0.95% N

3 Standard Chartered Bank 7,537.59 0.81% N

4 Necor Zambia Limited 4,316.39 0.46% N

5 Kapiri Transport 3,196.39 0.35% N

6 COMESA 2,238.96 0.24% N

7 Union Transport International 1,951.25 0.21% N8 Savenda Management Limited 1,919.88 0.21% N

9 Kansma Investments Limited 1,538.89 0.17% Y

58,415.73 6.93%

8/14/2019 Finance 2008 New

11/16



04/12/200704/12/2007

DSO Trends by Category

Overview

DSO Tre nds By Category

01020

3040

50607080

90100110120

130140

150160170

Jan F eb M ar A p r M ay Jun Jul A ug Sep Oct

Da

ys

Zambia 2007 SSA 2007 Zambia 2006

AR/Bad Debts/write-offs: as at Dec2005

Feb07 Impex cash 2001-2004 Writeoff Eur49k

Feb07 DGF 2001-2005 -Eur59k DGF system classification on migration

2007 Performance Drivers

1) OTC Implentation issues2) Better Client relations3) Quality Sales4) Internal Relations- Commecial-Ops-Finance5) Joint Calls

Credit Dept Restructure/ OTC

Staff Change Credit Mgt Country Review/ Audit Credit Mgt Training- SSA Credit Analyst Commission Structure Reconciliations Client Vetting

Closed Accounts Litigation Other OTC implementation-Dunning

8/14/2019 Finance 2008 New

12/16



04/12/200704/12/2007

Major Investments Update

Top 10 (Ranked by Value)

1) Motor vehicle OPS Zambia- Replacement & Expansion Y 140 G

2) Ndola Gateway Facility New & Lusaka Gateway Uplift N 50 R

3) Head office Improvements & Express Centres Y 45 G

4) Communications & Other IT Infrastructure Y 40 G5) Borders offices Livingstone, Nakonde, Kasumbalesa & Kazungula N 22 G

6) Coldrooms Lusaka & Ndola Gateway N 15 G

7) Luanshya Copper Mines In-House N 10 R

322

Investments within budget and timeless G

Investments on hold/delayed. Soon to be back on track A

Investments Investments exceeding budget and/or not meeting timeliness R

Project Descriptions

Status (Traffic

Lights)Timing

CAPEX

(EUR000)Budget (Y/N)

HM

8/14/2019 Finance 2008 New

13/16



04/12/200704/12/2007

8/14/2019 Finance 2008 New

14/16



04/12/200704/12/2007

8/14/2019 Finance 2008 New

15/16



04/12/200704/12/2007

8/14/2019 Finance 2008 New

16/16



04/12/200704/12/2007

Finance Summary

Other accomplishments Other challenges

HM

Other challenges

Other actions

+60days Debtors- down to 23%YTD vs 32% prior year

Weekly billing

Low billers migration

Cost Control-Bad debts,voicecomms, R&M

Personnel costs Vs Rev 25%benchmark achieved Q3 & Q4

Resolution of outstanding legalcases & reduced legal provisioning

Cashflow Management- Operatedwithin limits & net +ve Operatingcashflow vs 2006

Major trade payables outstandingnot more than 60days

Green financial audit

Balance sheet reconciliations up todate

Quality of Reporting- Accurate,verifiable

Training- Crest, SUN Collect

Cashlflow- Elimination of overdraft

+60days debtors- currently 23%.Target to bring down to 15%

Credit DSO- to bring under 30daysKCM inclusive

Cost reductions- Transportation,advertising, T&E & Other Operatingexpenses

Training & Succession planning

Systems- Migration to PASTELEvolution from Boffin-DGF, Migrationto IBS from NBR

Procedures- CAPEX vs BUD & BCAs

Cash flow- reduce bank O/D level+60 Debtors- agent receivables &

few large customers.

Cost Reduction- Continued focus

Continue managing Personnel costVs Rev to 25% benchmark

Ensuring only essential businessspend

+ve EBITA full Year to date.

Finance Compliance- CAPEX etc

Year End

finance 2008 new

Documents