The Huge Group has reported a year-on-year surge in revenue of 25%, to R308 million, for the six months ended 31 August.
The AltX-listed company achieved a gross profit of R73 million, and an increase in headline gross profit margins from 22.2% to 23.8%.
In a SENS announcement this morning, the group states operating profit margins before tax increased from 10.35%, for the 12 months to 29 February, to 14.24% for the six months to 31 August.
The group also reported earnings per share and headline earnings per share of 26.18c for the six-month interim period ended 31 August. Cash flow generated from operations for the period under review totalled R19.5 million.
Huge listed on AltX on 8 August 2007 and operates in the corporate telecommunications sector through its subsidiary company, Huge Telecom - which comprises the merged businesses of TelePassport and CentraCell.
The first half of the 2008/9 trading year was marked by weaker consumer confidence, as the impact of increases in interest rates, increased fuel prices, and volatility in global and local financial markets took hold, says the group.
“Despite inflationary pressure, trading performance remained robust during the period. The outlook for the remainder of the financial year shows every sign of being a lot tougher for South Africans and is expected to be challenging as the SA consumer continues to come under pressure,” it adds.
However, looking ahead, the company says the local telecommunications market for mobile voice traffic is growing at around 18% per annum.
“Mobile to mobile telephone calls terminated in SA, using cellular least-cost routing, amounts to approximately 2.8 billion minutes per annum.
“Taking into account that total fixed-line to mobile voice traffic, originated by Telkom and terminated on the mobile networks, is around 4.2 billion minutes per annum, the scope for organic growth in managed telecommunications is capable of exceeding the growth rates of the broader mobile telecommunications market.”
The group believes earnings growth rates in excess of 20% should be achievable for the foreseeable future.
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