Reunert lifts full-year profit by 10%

Reunert has on Tuesday (20 November) announced a 10% rise in operating profit to R1.525 billion for the year ended September 2012.

The group upped its final gross cash dividend to 275 cents per share, from 253 cents per share in 2011, bringing the total cash dividend for the year to 370 cents per share, from 330 cents before.

Reunert eported a 9% increase in normalised headline earnings per share to 644.4 cents per share from 590 cents befor.

Although revenues from our various businesses remained under pressure, particularly in the second half of the financial year, revenue increased by 7% to R11.662 billion, it said.

Nashua improved revenue by 4% to R7.218 billion whilst operating profit increased by 6%
to R839 million.

“The office automation business increased unit sales over last year in a market characterised by lacklustre demand and heightened competition. Revenue was further supported by the benefit of a full year’s trading from franchise acquisitions in 2011,” Reunert said.

Operating profit, however, was adversely affected by a sharp weakening of the Rand that exacerbated mounting pressure on margins.

Nashua ECN continued with the migration of the least cost routing (LCR) clients of Nashua Mobile to the VoIP, as well as pursuing new clients, Reunert said. “At year end the business was routing almost 3,5 million business call voice minutes per day. As a consequence, ECN has delivered a pleasing result, both in terms of revenue growth and operating profit,” it added.

Nashua Communications and Nashua ECN were merged on 1 October 2012.

Nashua Mobile reported a loss of LCR customers, while a reduction in the interconnect rates also impacted the business. The division’s post-paid customer base grew by 6% to 897,534 customers while the average revenue per customer declined by 19% to R337. “Although, as expected, revenue declined slightly, judicious cost control allowed operating profit margins to remain constant,” Reunert said.

Revenue for CBI-electric increased by 9% to R3.634 billion due to strong demand for certain electrical products as well as increased exports. Operating profit remained at R593 million.

Reutech upped its revenue for the year of 26% to R806 million with a substantial increase in operating profit to R151 million. This was due to strong performances from all the businesses but, in particular, the contribution from Fuchs through execution of a long anticipated export order.

Looking ahead, Reunert said that the local and global economic environment remains uncertain with 2013 also expected to be a challenging year. “We remain committed to our
strategy of diversifying our revenue streams and promoting efficiencies within our businesses.

“We will continue to act with prudence and foresight and shall, of course, plan for and pursue earnings growth,” it said.

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Reunert lifts full-year profit by 10%