JSE-listed Jasco Electronics' headline earnings increased by 10.7% to R14.2 million (December 2015: R12.9 million) and headline earnings per share (HEPS) increased 10.5% to 6.34c per share (December 2015: 5.74c per share).
The company revealed this today in its unaudited interim results for the six months ended 31 December 2016.
In a statement on the Stock Exchange News Service, the company says earnings per share (EPS) was up by 9.6% to 6.28c per share (December 2015: 5.73c per share).
It adds the weighted average number of shares in issue was marginally up from 224.2 million shares to 224.6 million. According to Jasco, this did not have a material dilutionary impact on EPS and HEPS.
In line with a more bottom line focus, the group says revenue of R521.1 million was 6.6% lower. In December 2015, it was R558.1 million.
"In spite of the difficult economic conditions in SA and the continued negative impact of the exchange rate during the period, Jasco's first half performance was pleasing, with the benefit of focusing on improving margins rather than revenue growth evident in the results," the company says.
"The main contributor to the results - representing 64% of group revenue - was Electrical Manufacturers, bucking the market conditions and delivering a strong top and bottom line performance, mainly due to the diversification strategy, with new customers adding to volumes."
However, it notes the carrier business - representing 36% of group revenue - disappointed on lower revenue, with reduced spend by the major telecommunications operators due to consolidation in the market. This business was worst affected by the volatile exchange rate, says Jasco.
It adds the exchange rate volatility impacted this period negatively, with a R6 million swing from a net foreign exchange profit of R2.1 million in the comparative period to a net foreign exchange loss of R3.9 million in the current period.
The foreign currency risk is carefully managed through a hedging programme, but is impacted by rand volatility when measuring the value of the financial instruments at reporting dates, the group notes.
Profit before interest and taxation was flat at R30.1 million (December 2015: R30.1 million) despite the losses on foreign exchange. This was mainly due to the good performances in Intelligent Technologies and Electrical Manufacturers, an improving performance from Enterprise and cost reductions at head office. These compensated for the drop in profit in carrier business.
The East Africa operations based in Kenya saw strong revenue growth from R0.6 million to R10.5 million, the company says. Expected start-up investment in the operating capacity of this operation resulted in an operating loss of R1 million. This was unchanged from to the comparative period.
Net finance costs of R5.6 million reduced from the corresponding period's R7.8 million. The finance income earned from long-term receivables decreased and relates mainly to the group's long-term co-location contract with an African telecommunications operator.
This morning, Jasco's share price was 93c.