Ellies eyes growth in telecoms space
Ellies, a manufacturer and distributor of electronic products related to television reception, says its infrastructure division Megatron, is targeting new opportunities in the telecommunication towers and data centre infrastructure space.
On Monday, Ellies upped its headline earnings per share by 73.3% to 54.45 cents for the year ended April 2012, from 31.42 cents a year ago.
Revenue grew 30% to R1.711 billion‚ while Ebitda rose by 71% to R273.4 million.
Ebitda margin was 15.9% compared to 12.1% for 2011. The increase is primarily as a result of improved margins in the infrastructure division‚ it said.
Profit before tax rose by 73% to R230 million as a result of improved gross profit margins and capacity utilisation‚ despite a loss from an associate amounting to R4.4 million.
A cash dividend of 10 cents per share was declared.
Ellies is a manufacturer, wholesaler, importer and distributor in diversified sectors, including consumer goods, renewable energy, and power and telecommunications infrastructure, servicing the local and African market.
The group said its infrastructure division delivered impressive full-year earnings. Megatron, which was bought by Ellies in December 2007 for R180 million, grew revenue by 158% and profit before interest and tax (PBIT) by 299% on the prior corresponding year.
“Megatron’s earnings growth is largely the result of its improved product offering across the various sectors in which it operates, with significant investments made in new products as well as the improvement in production facilities and an extended skills base. This has resulted in increased orders from an expanding customer base,” Ellies said.
Looking ahead, Ellies said its management remains optimistic on the growth prospects of the group through continued diversification into new product development and ventures, with a focus on infrastructure development and expansion of its customer base.
Ellies says it looks forward to the implementation of the Digital Terrestrial Television (“DTT”) migration throughout Southern Africa, something that has seen continuous delay.
Government has earmarked September as a provisional month for switchover, and Ellies would hope to manufacture and distribute set top boxes required for the migration process.
“Megatron’s growth is expected to continue, and is supported by its current order book and new business opportunities in South Africa and the rest of Africa. These new opportunities include the development of alternate power solutions, telecommunication towers and data centre infrastructure,” Ellies said.
“Substantial alliances with international technology and product leaders in industrial battery power storage, modular data centres, telecommunications and telecommunication towers have been secured,” the electronics specialist added.
Ellies concluded that its management continues to adopt a conservative approach towards SkyeVine, while cautiously optimistic of demand in this sector as additional service providers enter this space.
SkyeVine provides satellite-based broadband designed for the home user and small enterprise markets.
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