Sekunjalo Investments, a JSE-listed black empowerment investment firm, says a "seasonal" interim operating loss will not prevent it from achieving full-year growth.
Sekunjalo has investments in several sectors, including IT and telecoms, healthcare and pharmaceuticals, aquaculture and biotechnology, financial services and food and fishing.
The company's IT-related investments include FIOS, Synergy Computing, Semtech, XN Africa, Health Systems Technologies and Sharenet.
This morning Sekunjalo reported an operating loss of R16.7 million on revenue of R175.01 million for the six months to end-February, compared with a R20.14 million operating loss for the same period a year earlier, which was on revenue of R161.28 million.
The group recorded a pre-tax loss of R19.07 million (2005: R25.14 million), a loss for the period of R11.32 million (R17.78 million) and an attributable loss of R9.81 million (R14.45 million).
A basic and headline loss per share of 3.1c (6.2c) was recorded, corresponding to a trading statement issued yesterday.
The trading statement disappointed the market, since the company achieved a net profit of R37.47 million for the year to August 2005. The update resulted in the Sekunjalo share losing as much as 15c to an intraday low of 75c before clawing its way back to an 85c close, 5c or 5.6% down on the previous close.
Volumes were high, with about 6.1 million shares being traded.
Full-year growth
However, CEO Iqbal Surve says the results are in line with expectations and show significant improvements over the year-earlier period, with all operating divisions except healthcare performing to budget and on track to achieve full-year projections.
"Profits in fishing continue to be affected by the continued strengthening of the rand, restructuring costs and the pelagic season which again got off to a late start due to the delay in the long-term fishing rights process and environmental factors," Surve says.
"As in the past, the interim results were again impacted upon by the inherent cyclical nature associated with both the healthcare and the fishing industries, resulting in an operating loss."
The balance sheet shows current assets of R139.93 million (R147.3 million), of which cash accounted for R16.32 million (R24.43 million) against current liabilities of R121.32 million (R128.12 million).
Non-current assets of R378.95 million (R272.23 million) - of which R185.05 million (R188.01 million) is property, plant and equipment, compare with non-current liabilities of R106.06 million (R100.43 million).
Surve says the figures for the period are not an indicator of full-year earnings, which the group expects to be "significantly improved" compared with those of the previous year, mainly because of a focus on organic growth, income from newly bought businesses and the upside of the fishing and healthcare industries.
The share was trading 5c or 5.9% down at 80c early this morning.
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