E-business solutions integrator Comparex has grown its full-year headline earnings per share by 43.1%, reflecting a healthy turnaround in its African operations.
Figures at a glance
Comparex Holdings results for the year to 31 May 2001
Previous year`s figures in parentheses:
Revenue: R5.39b (R5.18b)
Gross profit: R2.03b (R1.8b)
EBITDA: R560.3m (R540.6m)
Attributable earnings: R345.3m (R198.7m)
HEPS: 85.9c (60c)
Net cash flow from operating activities: R589.5m (R478m)
NAV per share: R10.54 (R9.80)
Regional breakdown:
Africa:
Revenue: R2.56b (R2.4b)
Trading profit: R190.5m (R55.9m)
Europe:
Revenue: R2.74b (R2.7b)
Trading profit: R91.8m (R246.3m)
Other:
Revenue: R92.6m (R85.6m)
Trading profit: -R7.7m (-R5.1m)
Note: previous year on income statement reflects continuing businesses.
The group ended the year to 31 May 2001 with cash of about R3.7 billion, generated mainly from the sale of 46.6 million Dimension Data shares.
Despite the cash pile, no acquisitions were made.
"Had we bought any businesses a year ago, we would probably have destroyed shareholder value," says Comparex CEO Rian du Plessis. "Many of the companies that we spoke to during last year are now back talking to us."
Du Plessis says all the countries in which Comparex operates reported profits for the year. "We are extremely proud of this achievement."
However, he warns that earnings per share for the first half of the 2002 financial year are expected to decline as a result of the weak global environment and associated weakness in capital expenditure taking a bite out of IT budgets worldwide.
"Delayed purchases and cancelled projects are expected to have an impact on the results of the group in the short-term," he says.
"While it is more difficult to predict the effect of the global economic decline on the group beyond 30 November 2001, the group continues to target an increase in earnings per share for the year to end-May 2002."
Du Plessis says the process of repositioning Comparex as an integrator of e-business solutions continued during the year.
"Good progress is being made with the process, which is largely complete in Africa. In Europe, work remains to be done, particularly in settling into the new partner relationships with EMC, Sun Microsystems and Compaq."
He adds that the South African operations achieved a "material turnaround" in the year.
"As expected, the group`s European operations were the most affected by the restructuring during the period and reported lower profits than in the same period last year."
Du Plessis says the group is continuing to identify businesses that do not contribute meaningfully to profits, and which do not have the ability to do so, and will dispose of them over time.
Companies disposed of or closed during the year included Q Data Networks Cabling, Motodata, PQ Telesystems and Q Data Telecoms. IT also disposed of TimPlus and SecMod, two proprietary divisions of Nanoteq.
The group is also pursuing, "prudently", acquisitions in the areas of its strategic focus, he adds.
"The prospects for value-adding acquisitive expansion have significantly improved following the substantial correction in the value of companies in the group`s focus area during the year."
Du Plessis says the geographic focus remains on Europe and Africa.
The Comparex share was trading 15c or 1.29% down at R11.50 by late this morning.
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