IST Group`s latest financial results, for the six months to 31 August, show a decline of 13.5% in headline earnings per consolidated share, from 11.8c in the prior-year period to 10.2c.
Revenue increased by 2.3% to R148.58 million and earnings rose by 46% to R13.7 million.
"Delays in the awarding of major contracts and the continuing difficult trading conditions in the engineering technology sector were in line with the group`s expectations," says CEO Harry Coetzee. However, an exceptional order inflow valued at R420 million for the six months should keep IST on track to meet its earnings forecast for the year despite challenging market conditions.
"The R260 million contract awarded to IST Nuclear by the Pebble Bed Modular Reactor Company for the detailed design of three key systems for the PBMR demonstration plant represents the largest single contract in the IST Group`s history.
"It will be executed over 42 months and is budgeted to generate additional revenue of some R19 million in the latter half of the current calendar year."
Coetzee says the group is actively pursuing acquisitions to strengthen and expand existing businesses, with two prospective targets in their final evaluation stages.
"All the delayed contracts have now been awarded and the group currently has a healthy order book. In addition, the major product development expenditure has largely been completed. The effect of this is that cash reserves will again start to rise and the group`s marketing effort will be enhanced by the expanded offering.
"IST should produce a stronger performance in the second half of the year and is expected to achieve an earnings increase similar to that of last year."
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