Mecer and other hardware distributor, Mustek (MST) on Thursday (February, 16) announced a 20.9% rise in turnover to R1.964 billion for the period ended December 2011, from R1.625 billion previously.
Gross profit percentage increased to 14.7%, from 14.4% in 2010.
However, the group warned that it expects a decline in earnings when it announces its H1 results.
Included in the profit from operations is R62.9 million, relating to realised and unrealised foreign exchange losses (December 31, 2010: R14.7 million foreign exchange profits).
“A significant portion of these losses will be recovered when the related inventory is sold and by settling certain foreign creditors at lower levels than the R8.10 used at December 31, 2011, to revalue foreign creditors,” Mustek said.
The group said that, as a result of the sharp and sudden depreciation of the rand against the US dollar during September 2011, a substantial amount of inventory was accounted for at lower levels compared to where the local currency has depreciated to.
The group said that as long as the rand remains as volatile as it currently is, reported earnings will remain in line with the volatilities of the rand.
Accordingly, Mustek advised that headline earnings per share is expected to be between
55% and 65% lower for the six months ended December 2011, than headline earnings of 36.20 cents per share previously.
Basic earnings per share is expected to be between 35% and 45% lower than basic earnings of 36,12 cents per share.
Net asset value per share is expected to be between 640 cents and 650 cents.
The company expects to publish its results on about February 29, 2012.
Shares in the group slipped 25 cents or 4.35% to R5.50 on the JSE.