Poynting makes moves on Europe
JSE AltX-listed antenna manufacturer Poynting has issued a cautionary announcement as it moves to fully acquire Poynting GmbH – also known as Poynting Europe.
Poynting Europe is based in Germany and is the exclusive distributor of Poynting’s commercial antenna products in the European market.
The group has entered into a non-binding heads of agreement to acquire 100% of the operation, which if successfully concluded, may have a material effect on the price of the Company’s securities.
“As soon as a final binding agreement has been concluded, further details will be disclosed,” Poynting said.
In December 2013, Poynting concluded the acquisition of its gateway into the rest of the African continent, Aucom.
In its full year results for 2013, the group indicated that it expects to boost revenues by as much as R100 million through strategic acquisitions, with a further R150 – R350 million added to the pot through the growth of its businesses.
“Aucom’s performance for the 12 months has been better than expected and has exceeded [its] 12 month profit guarantee,” Poynting noted in its latest trading statement.
However, the group noted further that the costs of the acquisition will be included in the financial results for the year ending 30 June 2014 – which had a material negative impact on profitability – and has warned that the 2014 results may not be as peachy as the year prior.
“A review of the financial results for the year ending 30 June 2014 by management has indicated that the earnings per share and the headline earnings per share are expected to be at least 50%
lower compared to the earnings per share and the headline earnings per share of 10.48 cents for the year ended 30 June 2013,” the group said in a statement.
“The Defence division showed strong growth but this was to a large extent offset by losses in the Commercial, New Projects and CCS divisions as they continued to invest in product development, new technology and marketing.”
The benefit of the Aucom acquisition is expected to reflect in the first half of the 2015 financial year, it said.
For the full year ended June 2013 (reported in September 2013), the group reported a 36% jump in net profit to R9.84 million. Poynting is expected to release its 2014 full year results on 12 September.
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