{"id":443312,"date":"2020-10-26T09:53:51","date_gmt":"2020-10-26T07:53:51","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=443312"},"modified":"2020-10-26T09:54:07","modified_gmt":"2020-10-26T07:54:07","slug":"adapt-it-eyes-elearning-growth-as-shares-spike-on-solid-earnings-during-difficult-trading-period","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/cloud-hosting\/443312\/adapt-it-eyes-elearning-growth-as-shares-spike-on-solid-earnings-during-difficult-trading-period\/","title":{"rendered":"Adapt IT eyes e-learning growth as shares spike on solid earnings during difficult trading period"},"content":{"rendered":"<p>JSE-listed Adapt IT, a provider of specialised software and digitally-led business solutions, on Monday (26 October) reported a 3% rise in revenue for the year ended June 2020, to R1.48 billion, comprising muted organic growth of -2% and growth from acquisitions of 5%.<\/p>\n<p>Headline earnings per share (HEPS) increased by 29% to 72.58 cents per share, and earnings before interest, tax, depreciation and amortisation (EBITDA) improved by 9% to R250 million.<\/p>\n<p>&#8220;The tough trading conditions in South Africa were a catalyst for Adapt IT to drive operational improvements through significant cost containment measures in segments most impacted by Covid-19. Most operational efficiency projects have been completed, which will result in cost savings in\u00a0 future financial periods,&#8221; Adapt IT said.<\/p>\n<p>The board decided to suspend the payment of dividends so as to preserve cash amid the fallout from the Covid-19 pandemic.<\/p>\n<p>\u201cI am pleased to report that in a year dominated by global macroeconomic challenges and the Covid-19 pandemic, Adapt IT proved to be highly resilient, through its sound underlying business model of providing mission critical software to its clients on a long term basis,\u201d said Adapt IT chief executive officer, Sbu Shabalala.<\/p>\n<p>The business cost structures where the market landscape has changed have been right sized for the current market, he said.<\/p>\n<ul>\n<li>The Education division delivered increased revenue of 8% inclusive of acquisitions, and although it experienced project delays, there was an increasing demand for eLearning solutions. This division contributed 16% to total revenue and delivered EBITDA margin of 16% (2019: 16%).<\/li>\n<\/ul>\n<ul>\n<li>The Manufacturing division experienced an 18% decrease in revenue due to project volume declines and delays, achieving an EBITDA margin of 13% (2019: 15%). The Manufacturing division contributed 17% to total revenue.<\/li>\n<\/ul>\n<ul>\n<li>Financial Services achieved revenue growth of 12%, contributing 20% to total revenue and delivering a 21% EBITDA margin (2019: 19%).<\/li>\n<\/ul>\n<ul>\n<li>The Energy division experienced a 5% decrease in revenue as a result of the drop in project revenue, contributing 8% to total revenue. EBITDA margin improved considerably from 5% to 10% due to the implementation of a revised strategy and the efficiency measures taken. The results support the planned recovery of this division.<\/li>\n<\/ul>\n<ul>\n<li>The Communications division grew by 33% inclusive of acquisitive revenue, achieving an EBITDA margin of 30% (2019: 32%) and contributing 21% to total revenue.<\/li>\n<\/ul>\n<ul>\n<li>The Hospitality division was significantly impacted by the measures implemented by government in this industry to respond to Covid-19. Consequently, revenue declined by 7%, resulting in 4% EBITDA margin (2019: 9%). This division experienced non-recurring costs during the reporting period mainly due to inventory write-offs of R7 million and retrenchment costs of R2 million with the acceleration of the planned operational efficiency projects to respond to Covid-19. The Hospitality division contributed 18% of total revenue.<\/li>\n<\/ul>\n<p><a  data-lightbox=\"post-image\" href=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/10\/Adapt-IT.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-443352\" src=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/10\/Adapt-IT.png\" alt=\"\" width=\"715\" height=\"381\" srcset=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/10\/Adapt-IT.png 715w, https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2020\/10\/Adapt-IT-300x160.png 300w\" sizes=\"auto, (max-width: 715px) 100vw, 715px\" \/><\/a><\/p>\n<p>\u201cThe South African economy has been hard hit by the Covid-19 pandemic and the associated regulations, but the impact on our segments is mixed, with some presenting new opportunities, like increased eLearning and telecommunications use,&#8221; Shabalala said.<\/p>\n<p>\u201cAdapt IT continues to take advantage of its underlying diversification. This is done by assisting the current client base more effectively, focusing on sales in a cohesive manner and carefully expanding on the Pan Africa and Asia Pacific strategy.<\/p>\n<p>&#8220;Furthermore, by remaining focused on cost containment, capital allocation and working capital, Adapt IT aligns itself with stakeholder expectations.&#8221;<\/p>\n<hr \/>\n<p><strong>Read: <a href=\"https:\/\/businesstech.co.za\/news\/it-services\/437385\/adapt-it-sees-improved-earnings\/\" target=\"_blank\" rel=\"noopener noreferrer\">Adapt IT sees improved earnings<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>JSE-listed Adapt IT reported a 3% rise in revenue for the year ended June 2020, to R1.48 billion comprising muted organic growth\u00a0 of -2% and growth from acquisitions of 5%.<\/p>\n","protected":false},"author":10,"featured_media":376381,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33],"tags":[3899,26],"class_list":["post-443312","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cloud-hosting","tag-adapt-it","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/443312","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=443312"}],"version-history":[{"count":10,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/443312\/revisions"}],"predecessor-version":[{"id":443378,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/443312\/revisions\/443378"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/376381"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=443312"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=443312"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=443312"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}