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BCX gears up for African demand

Nicola Mawson
By Nicola Mawson, Contributor.
Johannesburg, 16 Apr 2014
Business Connexion is looking for an acquisition opportunity in Ghana, says deputy CEO Vanessa Olver.
Business Connexion is looking for an acquisition opportunity in Ghana, says deputy CEO Vanessa Olver.

Business Connexion (BCX) is boosting the balance sheets of its two key international operations, so they can cope with the amount of orders coming in.

Deputy CEO Vanessa Olver explains the loss at its international unit in the six months to February was because the Nigerian unit could not fund all the stock for the orders it was receiving.

Revenue in the international division grew 30.9%, to R314 million, because of BCX's growing Nigerian presence, but the unit reported an operating loss of R12.7 million, compared to the previous R5.7 million gain.

Olver says Nigeria will be profitable in the second half, but will not meet its targets, because of the first-half loss. She says the unit did not have sufficient cash facilities to fund stock for the orders it was receiving.

Measures have now been put in place to extend its balance sheet to cope and prevent a repeat of this situation, says Olver. She adds these lessons have also been applied to Kenya to head off a similar issue.

Overall, revenue gained 5.5%, to just over R3 billion, while net profit more than doubled, from R101.4 million to R224.4 million, in the first half. Its operating profit leapt on the back of its sale of QLink for R187.5 million last year, gaining 107%, to R300.3 million.

Olver says the group sees big opportunities in Nigeria and Kenya, which are its current focus areas. It is also looking for acquisition opportunities in Ghana, which will provide it with cross-border prospects, she notes.

Last month, it bought all of Panabiz Nigeria, and 100% of the holding of Ultimate Solutions Botswana for an undisclosed amount as part of its bid to grow international revenue to 30% of total income over the next few years.

Kenya, which is still in start-up mode, is gaining traction and has won a contract to roll out its solar enterprise resource planning solution in one county, says Olver. She notes this deal may be expanded to other regions.

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