Reunert produces strong growth for 5th consecutive year
Tuesday, 19 November 2002
For the fifth consecutive year, Reunert Limited produced headline earnings per share growth in excess of 25% per annum. These results were based on a mixture of organic and acquisitive growth.
"All businesses are producing good results, bearing in mind their individual circumstances," said chief executive Gerrit Pretorius. "In most cases sales have grown strongly, while operating margins benefited from the increased activity."
Nashua, the office systems operation and all it divisions, performed strongly. This was partly due to the excellent year experienced by the in-house finance arm, RC&C Finance Company, which increased its rental book by 28% to R954 million. Royce Imaging, the re-manufacturer of toner and cartridges performed well doubling its sales since being acquired a little more than a year ago.
Reunert also today announced that it has reached agreement with The IQ Business Group to acquire the 50% stake in IQ Works currently held by them. Pretorius says this will enhance the Nashua digital product offering in future.
NPC Electronics, exclusive distributors of Panasonic products showed growth in the business and non-consumer operations. Consumer demand was flat. Futronic, a new brand targeting the entry-level consumer market, was launched last month, whilst the distribution rights for Nintendo games were secured.
Nashua Mobile, which became a wholly owned subsidiary during the year, did well. The subscriber base has grown to 265 000 with an additional 45 000 pre-paid customers. Average revenue per user (ARPU) is in the region of R570 per month and is aided by an increased offering in value added services.
The group's telecommunications operations have had a pleasing year. The market has continued to expand with the spend on the third cellular licence, the second network operator and the telecommunication infrastructure spend in Africa.
CBI grew sales by 39%, clearly showing the benefits of its wider product offering locally and its growing penetration of the export market. Approximately 17% of sales revenue comes from exports and the company expects to grow this steadily as the quality of the local product gains recognition.
African Cables benefited from increased local demand for power cables, resulting in improved turnover. Margins improved due to operational efficiencies.
Reunert, subject to approval by the Competition Commission, recently acquired Marconi plc's 51% stake in ATC increasing it stake to 89,5%. "The decision to increase our investment in ATC clearly demonstrates our belief that this business will turn and again produce good results. Negotiations to introduce a black economic partner are progressing well and will hopefully be finalised early in the new year," Pretorius said.
"We are proud of our achievements over the past five years. During this period, Reunert has distributed more than R1.2 billion to shareholders by way of dividend, which is around 30% of our current market capitalisation. In addition, we have achieved compound growth in headline earnings per share in excess of 25% per annum."
A final dividend of 88 cents per share was declared, bringing the total dividend for the year to 118 cents per share - an increase of 30% per share for the year.
For more information contact
Carina de Klerk
Tel +27 (0) 11 517 9000
Mobile +27 (0) 83 631 5743