Alaris Holdings, which until a week ago was known as Poynting, will focus on niche opportunities in the communication and electronic warfare space as it rebuilds itself.
Poynting's name change came after the company hived off its loss-making units and bought a US defence player, Antenna Research Associates (ARA). Acting CEO Juergen Dresel, who co-founded the company and was MD of Poynting Antennas, says the name change "is not only very exciting, it also provides us with an opportunity to reposition ourselves and portray our renewed focus".
Dresel says the company is now focused on "trying to get back to what we are good at doing". He says the company will focus on designing, making and selling antennas as well as seeking profitability at its digital TV unit.
In addition, Alaris aims to wrap up its deal to buy ARA by the end of June, which will give the company an opportunity to cross-sell defence products in the lucrative US market, says Dresel.
The acquisition, which will cost $5 million (R58.3 million) and 75.8 million shares (worth R141 million), will enable Alaris to expand into the US market, which it sees as the "land of milk and honey", as ARA already has clients there. It says this move is a bid to take the risk out of its defence unit.
In the US, Alaris will add satellite communications products to its range as well as high-frequency devices used for satellite communications, says Dresel. He notes there will be intellectual property synergies between Alaris and ARA.
Dresel adds the company will be focusing on electronic warfare products, such as jamming and monitoring solutions, as well as on military communication devices. It also opened a new unit 18 months ago that provides test and measurement equipment, he says.
Growth aims
Last year, the company that was Poynting sold its loss-making units to its former CEO Andre Fourie in a deal that saw Alaris also pay over 14 million shares. The company was left with its defence and digital television units (through African Union Communications) after the deal.
Its decision to sell its unprofitable units was driven by the amount of time and investment required to turn them around, and has also simplified the group and positioned it for growth, it says. Dresel notes the company is on track to meet its end-June targets.
In the six months to December, Poynting reported revenue up to R75 million from R37.6 million, and its results showed its headline earnings per share were positive. However, adjusting this metric to remove the units sold during the period, headline earnings per share showed a decline from 10.77c to 5.26c a share.
Although total comprehensive income for the six months for the group was R27.7 million, compared to R3.8 million in the comparative period, the results are skewed due to various accounting issues.
Poynting's discontinued operations, the units it has sold off, generated a loss of R6.5 million in the half-year compared to a loss of R6.1 million a year ago.
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