Barloworld Ltd. : Barloworld -- trading update

SENS Note - 25 January 2012

Barloworld -- trading update

Trading for the first quarter of the 2012 financial year has seen a continuation of the positive momentum from 2011.

Equipment
In Equipment Southern Africa, revenue and operating profits are up on the prior year due to sustained mining, contract mining and after sales activity. Construction activity in South Africa, however, remained muted. Trading in the southern African territories outside of South Africa remained strong and Angola has seen a marked improvement. The firm order book at December has increased from the R5.2 billion reported at September to over R6 billion. This should largely underpin our performance for the balance of the financial year.

Trading in Russia continued strongly and the firm order book at December is up on September levels and remains dominated by mining orders. The power business showed a marked improvement driven primarily by sales in the electric power segment.

The Spanish economy remains under pressure and Iberian revenue in the first quarter was slightly down on the prior year. In accordance with our plans, we implemented a restructuring in December to further realign costs with prevailing activity levels. This will benefit our trading result in the second half of the financial year. The order book includes some large package deals announced at the year end, the majority of which deliver into 2013.

Automotive and logistics
The automotive and logistics division is trading well ahead of the prior year. Car rental volumes and rental rates are improving while fleet utilisation remains high. Motor retail operations in southern Africa experienced improved volumes and higher overall margins. Australian operations continue to deliver, supported by a stronger Australian dollar. Fleet Services provided a solid result and vehicles under management continue to grow.

The logistics operations in southern Africa are performing ahead of the prior period, supported by recently awarded contracts and improving volumes. While the international businesses have benefited from the prior year restructuring, they remain affected by lower volumes and depressed freight rates.

Handling
In handling, year to date sales are ahead of last year with trading profits reflecting a good turnaround on the loss incurred in the prior period.

Agriculture
South Africa continues to produce good results on the back of strong maize prices and improved farming sentiment which translated into a significant increase in revenue.

Finance
Net debt levels have risen since September 2011 in support of the growth in trading, but remain within target ranges. Barloworld anticipates working capital at March to remain high in advance of strong machine deliveries in the second half.

Corporate Activity
Discussions with Caterpillar Inc are continuing in relation to the possible acquisition of Bucyrus distribution rights in existing dealership territories. The group continues to evaluate strategic opportunities in all businesses.