Jasco returns to profitability

·17 Sep 2014

Listed ICT firm Jasco Electronics on Wednesday reported a return to profitability for the year ended June 2014, mainly due to the non-recurrence of once-off impairments and write-offs.

Operating profit improved from a loss of R93.5 million in 2013 to a profit of R17.6 million; however, revenue declined 9% to R1.04 billion, following the disposal of the Lighting and Telecommunications Structures businesses (R77.5 million) in 2013 and Automotive (R6 million) in January 2014.

Jasco said that 2013 also created a high base due to the inclusion of a R65 million once-off project in Co-locations Solutions. A number of orders that were expected to flow through in 2014 were delayed, but received post year-end.

Headline earnings per share (HEPS) was up 52% to 0.5 cents per share (2013: 0.3 cents per share).

Looking ahead, Jasco said its home market of South Africa will continue to remain challenging, with low growth and a volatile labour environment.

“Against this, further costs will be cut and geographic and market diversification continued. The group will also finalise its exit of low-margin manufacturing,” it said.

The group completed its three year restructuring and said that the full benefits of the restructuring will flow through from 2015, “although the first half has been strongly impacted by strike action in the metals industry”.

“The group will continue to increase the range of products and services sold into its existing customer base as part of its cross-selling activities,” it said.

It noted that good progress was seen in east African countries, with projects already won in Zimbabwe, Tanzania, Kenya and Mozambique.

“The group will continue to develop its regional strategy on a measured basis,” Jasco said.