JSE-listed Business Connexion (BCX) wants to gain 30% of its earnings from the African continent within the next three to five years, and has set its sights on expanding into several countries.
The group yesterday reported its full-year results and said revenue gained 35.1%, to R5.8 billion, in the 12 months to August. It added that it improved its margins, partially thanks to its acquisitions of several UCS businesses and the Canoa group.
Profit for the year rose to R196.1 million, from R102.3 million, and BCX generated diluted earnings per share of 37.2c, compared with 27.6c, while diluted headline earnings per share came in at 38.8c, compared with 2011's 17.2c.
CEO Benjamin Mophatlane says the group generated around R420 million from its current African operations. He says if earnings reach 30% of the total within the next three to five years, BCX will have "done well".
BCX ended the year with cash and cash equivalents of R443.9 million, but is set to pay out R56 million and another R70 million over three years to pay for its acquisition of Integr8 IT, which it announced yesterday.
Scouting around
Mophatlane says BCX will consider more opportunities if they come along, and will invest its cash into niche services, as well as into its African expansion plans.
Acquisitions are "very hard to come by" so BCX will also be investing in organic growth, says Mophatlane. BCX will definitely acquire in order to expand on the continent if there are opportunities, as this would be easier than starting a greenfields operation, he notes.
BCX will expand its data centre capacity in Kenya and Nigeria, where it has a strong pipeline, says Mophatlane. He adds that the group may also look at software-as-a-service companies in SA to complement its existing structure and expand its verticals.
The listed group now has around 7 000 staff across Africa after buying Integr8 IT, the core of the Integr8 group, and sees an opportunity to become a pan-African ICT services company.
Mophatlane says BCX already has a footprint in Nigeria, Kenya, Mozambique, Namibia, Zambia and Tanzania. The group would like to expand into fast growing countries such as Ghana, Ethiopia and Angola, and is also looking at Zimbabwe.
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