IOL / 22 MAY 2018, 12:25PM / STAFF REPORTER
JOHANNESBURG - JSE-listed African Equity Empowerment Investments Limited (AEEI), a diversified investment and empowerment company today announced its interim results for the six months ended 28 February 2018.
The Johannesburg Stock Exchange’s (JSE) largest Black Economic Empowered (BEE) listed entity continues to attract strong investor confidence, as shown in the company’s spectacular growth and excellent increases in revenue and profits.
Khalid Abdulla, Group Chief Executive Officer of AEEI . Image: Supplied.
The performance is attributed to strong contributions from all its divisions, with a combination of organic and acquisitive growth and the successful separate listing of its Technology business, AYO.
Group revenue increased by 33% from R455m to R604m. This was mainly due to significant revenue growth achieved from AEEI’s holding in the Technology division. Operating profit increased substantially by 1 326% from R587m to R8 371m due to consistent organic and acquisitive growth, and efficiencies achieved in all its divisions. The successful separate listing of AYO also contributed significantly.
Profit before tax, excluding fair value/gain, Cash Profit, increased by 455% from R34m to R188m.
This is testament to the solid management of the underlying operational man Net Asset Value (NAV) for the Group increased by 492% from R1.4bn to R8.3bn with the NAV per share increasing by 506% from 279.65 cents in the prior period to 1 694.67cents. With the solid financial performance derived from the underlying businesses, net cash generated from operating activities increased by 23% compared to the prior period from R35m to R43m.
Working capital has been provided for growth and if one adds back the working capital provision, net cash generated from operating activities has increased from R35m to R146m after providing for the working capital needs of R103m.
Addressing analysts and shareholders at the Investment Analyst Society’s presentation, Mr Khalid Abdulla, Group Chief Executive Officer of AEEI sent a strong message to the market: “It is heartening to see the Group’s dedication and commitment to perform. For the last few years when presenting, I have referred to our ‘Vision 2020 Vision’ strategy, and it is now clearly apparent that our goals and targets are being met and in most cases, exceeded.
“This performance and vision was further validated when I recently spent time abroad in several of the industries within which the Group operates and while the global economic environment has residual challenges, investor confidence in AEEI and indeed, South Africa, remains firm.
Despite numerous possible distractions, AEEI continues to keep its eye on the goal and is firmly focused on delivering on what it has set out to achieve.”
Premier delivered a great set of results while trading during tough conditions for the interim period ended 28 February 2018. Operating profit increased by 14% and profit after tax increased by 59%, from the prior period, mainly driven by the strong performance in the squid and lobster divisions.
Good catch rates as well as cost efficiencies across most of its divisions also assisted in the company’s sterling performance. Premier also concluded the purchase of a controlling stake of 50.31% in the Talhado Fishing Group (Pty Ltd (Talhado). This acquisition is one of the largest made by Premier since its listing and is said to be a strategic value-add to the Premier Group.
AEEI’s associate, AYO Technology Solutions Limited (AYO), has effectively been listed for two months of this reporting period.
During the interim period under review, the Group relinquished control of AYO resulting in the division becoming an associate. AEEI now has 49% of the equity interest in AYO and its results are accounted for as an associate. The ICT associate achieved significant growth in revenue of 49% from R234m to R349m mainly as a result of obtaining new customer contracts in the financial services sector.
The AYO group increased its profit by 173% from R30m to R82m for the period under review, which shows the consistency in growth plans. AYO is currently concluding discussions with several complementary acquisition targets which will augment its “Go to Market” strategy. Operating profit for the associate increased by 70% from R27m to R46m, despite the once-off listing costs and B-BBEE transaction impacting the profitability of the associate. Since listing, AYO has concluded a significant contract with SASOL to provide core competencies, products and services, details of which announced today.
Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER