ARB full-year revenue up 25%

Electrical products distributor ARB Holdings has reported a 12% rise in headline earnings per share to 34.25 cents for the year ended June 2012.

Diluted HEPS rose to 34.18 cents from 30.57 cents.

Revenue was up 25% to R1.565 billion and operating profit rose by 16% to R128 million‚ primarily due to ARB Electrical Wholesalers’ continued growth in market share as well as the inclusion of Eurolux’s results in the second half of the year.

Furthermore‚ the group’s overall gross profit margin for the full year increased from 18.7% in the prior year to 19.6% at the end of June 2012 as a result of the higher margins generated by Eurolux.

An annual dividend of 13.7 cents per share declared – 12% higher than the previous year.

The group distributes electrical products such as power cables‚ overhead line conductors and equipment‚ low and medium voltage products as well as lamps and lighting.

The company said it had delivered an impressive set of results despite competitive trading conditions.

CEO Byron Nichles said the strong trading performance coupled with the strategic acquisition of Eurolux enabled the group to report “pleasing growth” in both revenue and profits for the year.

The increase in the group’s overheads reflects the consolidation of Eurolux as well as the continued investment in broadening the organisational capacity of the group.

“The strategic acquisitions of Eurolux as well as Industrial Cable Suppliers (ICS) (effective post year end‚ 2 July 2012) have enabled ARB Holdings to evolve from a single trading operation into a group of strategically aligned business units‚” Nichles said.

The group’s largest contributor to revenue‚ ARB Electrical‚ delivered a stellar set of results‚ increasing revenue by 15% and operating profit by 14%.

Lighting‚ a new reporting division‚ which houses Eurolux’s results for the six months to June 2012‚ contributed R120 million towards revenue and R5.1 million towards the group’s operating profit. Although negatively impacted by mark-to-market losses incurred on foreign exchange contracts due to the sudden and unexpected recovery of the Rand in January 2012 and the transaction costs relating to the Eurolux acquisition‚ the acquisition was earnings-enhancing‚ the company said.

ARB continues to focus on cash management which is reflected in the strong cash balance of R180 million.

“Notwithstanding the tough macro economic environment‚ our strategic acquisitions of Eurolux and ICS‚ which will be included for the full year to June 2013‚ will enhance our continued growth in the coming years‚” Nichles concluded.