Reunert on Tuesday (20 November) reported positive growth for the 2018 financial year ended September, with revenue up by 7% to R10.49 billion.
It noted that in a volatile rand environment, operating profit grew by 3% from R1.54 billion. This, it said, was achieved despite a sharp decline in electrical engineering’s profitability, driven by improved earnings in both the ICT and applied electronics segments, it said.
The ICT and applied electronics segments, which includes Nashua, performed well, particularly in the second half of the year, Reunert said. The ICT segment improved sales in high category multi-functional printers and had good growth in new total workspace solution sets.
Applied electronics growth was driven by record export sales, the benefit of a weakening rand in the second half and the rapid expansion of the renewable energy business.
Reunert said that this improvement in profitability, combined with the reduction in the number of shares in issue resulted in headline earnings per share growing by 4% to 703 cents per share. Normalised headline earnings per share cents was up 1% to 697 cents per share.
A dividend has been declared from retained earnings, Reunert said, bringing the total dividends declared out of 2018 profit for the year to 493 cents per share.
“The ICT segment had another pleasing year as it continues to implement its strategy, Reunert said. Revenue increased by 4% to R3.4 billion and operating profit increased by 25% to R792 million, including a fair value gain of R77 million as a result of the remeasurement of the SkyWire contingent purchase consideration.
Excluding the fair value remeasurement, the operating profit increased by 13% to R715 million.
The office automation cluster continued to produce strong product sales, Reunert said. Revenue from products and services grew by 7% and generated 13% of total revenue.
“The franchise channel performed strongly and the adoption rate of the new total workspace products and services continues to increase.”
Looking ahead, Reunert said that recent government commitments to increase infrastructure investment bode well for a recovery in the electrical engineering segment although uncertainty as to the timing and extent prevails.
“The ICT segment is anticipated to continue to deliver a good performance as its strategy execution continues and the SkyWire acquisition bolsters the growth of the segment,” it said.