Pinnacle posts interim revenue jump
Listed ICT player, Pinnacle Technology has reported a 14.5% rise in group turnover for the six months ended December 2012, to R3.1 billion, with all sectors “contributing well”.
The group noted on Wednesday (6 March) that fully diluted headline earnings per share of 93.8 cents was up 19.8%, while earnings before interest, taxes, depreciation, and amortisation lifted 16.1% to R229 million.
Pinnacle said that distribution grew turnover by 13.4%, and profit before tax by 13.7% year-on-year with a number of large deals being concluded in the last few months of the year.
“Core ITC spending is holding up well due to new product releases such as Windows 8, and the group´s entry into the mobile computing arena with our offering of tablets and smart phones.,” it said.
According to Pinnacle, promising growth was experienced in value added areas including security, cabling, racking and automation, which supported margin improvement, “but this was somewhat offset by conditions in the retail sector which were tough with both margins and volumes under pressure this year during a disappointing December holiday season”.
The group said that the integration of Axiz and Workgroup was now largely completed, with the combined entity set for promising future growth.
The Projects and Services division increased turnover by 45.5% and profit before tax by 15.2%, while Financial Services increased profit before tax by 27.1%.
Looking ahead, Pinnacle said that although trading conditions are likely to remain tough, “we are reasonably confident that the growth momentum seen in the first half of this year will continue in our existing businesses for the remainder of the financial year”.
It said that some of the investments in the value added segments are showing positive signs, which should contribute towards overall group growth.
It pointed out that the creation of a full time executive post in the corporate finance area of the business illustrates the group’s strategic commitment to growth by acquisition.
“Acquisitive activity will be targeted at new but allied product ranges and markets that own a higher proportion of the supply chain and therefore generate higher margins.
“We will also look for new geographies that fit our experience and provide sufficient potential. Acquisitions will only be made on an income accretionary basis to reduce the probability of any short-term penalty to the company´s share price,” Pinnacle said.
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