Investment holding company The Bidvest Group increased headline earnings by 19% in the half-year to December. The increase would have been bigger if not for the strengthening of the rand.
Among other operations, Bidvest has several IT-related operations, including networking and desktop outsourcing services company I-Fusion and electronic business-to-business marketplace mymarket.com.
<B>Salient figures</B>
The Bidvest Group results for the six months to 31 December 2002.
Year-earlier figures in parentheses, move in square brackets:
Revenue: R24.57b (R19.79b) [+24.1%]
Operating income: R1.13b (R923.95m) [+22.1%]
Income before tax: R1.07b (R899.74m) [+18.7%]
Income after tax: R768.55m (R664.42m) [+15.7%]
Headline earnings: R754.91m (R634.03m) [+19.1%]
Attributable income: R732.31m (R620.06m) [+18.1%]
HEPS: 243.2c (214c) [+13.6%]
Distribution per share: 108c (90c)
Cash generated by operations: R534.5m (R325.33m)
Current assets: R9.76b (R8.28b)
Liquid funds: R1.95b (R1.99b)
Current liabilities: R7.88b (R6.85b)
NTAV per share: 1 609c (1 447c)
Bidoffice manufactures, distributes and supplies commercial office products including computer consumables and other office automation products.
"The excellent operational performance has been masked by the impact of the strengthening rand," says executive chairman Brian Joffe.
Translation gains fell to R3.7 million from R74.8 million in the year-earlier period. Joffe says the 13.6% growth in headline earnings per share would have been 28.2% if the effect of the translation gains were excluded.
Shareholders are to receive a payment of 108c a share, made up of a dividend of 54c and a distribution out of share premium, also 54c.
Bidoffice saw a 49.2% increase in revenue to R2.3 billion with operating income rising 41.3% to R180.7 million.
Voltex, a distributor and wholesaler of electrical products to the industrial, reticulation, domestic and general electrical markets, generated revenue of R1.1 billion and operating income of R48 million.
Empowerment
Joffe says I-Fusion`s cabling business has been downscaled. I-Fusion`s revenue declined from R74.63 million to R32.05 million. An operating loss of R3.54 million compares with a previous loss of R5.67 million.
Mymarket.com incurred an operating loss of R3.39 million on revenue of R1.32 million.
Joffe says the mymarket.com platform is trading well in SA. "Thirty national customers have registered a total of 2 500 buyers that conclude an average of 10 000 purchases per month from 600 different suppliers.
"Customers, including Bidvest companies, are benefiting from significant synergies, cost and process savings, as well as more efficient purchasing practices. Operations in the UK are in the final stages of roll-out and training."
Bidvest`s biggest revenue contributors are the food service products (revenue: R12.2 billion, operating income: R453.1 million) and services (revenue: R9.4 billion; operating income: 367.9 million) divisions.
The group is pursuing empowerment initiatives which, Joffe says, together with the 24% of the group currently held by institutions for the benefit of historically disadvantaged individuals, will result in a significant empowerment stake in Bidvest.
The release of the interim results coincides with the announcement that Fani Titi, an existing non-executive director, has been elected deputy chairman, succeeding Mervyn Chipkin, who remains a director.
Among other positions he holds, Titi is chairman and co-founder of black economic empowerment company Tiso Capital.
Joffe says the effect of the "strengthening, yet volatile" rand will continue to be significant. "Despite this, all South African businesses are expected to trade well in 2003."
The Bidvest share was trading at R41.60 on the JSE this morning, up 108c or 2.67% from Friday`s close.
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