A strong performance by Incredible Connection helped IT retailer Connection Group increase headline earnings by 50.7% to 52.44c a share for the six months to February, from 34.79c for the prior-year period.
The results include figures from Beyond IT and Photo Connection, which were acquired in the 2004 calendar year.
Revenue rose by 35.8% from R365.71 million to R496.48 million, while the operating profit before interest and depreciation climbed 60.4% to R32.4 million from R20.2 million previously.
Pre-tax profit was 45.6% up at R25.47 million and a net profit of R17.04 million compared with the previous year`s R11.72 million.
The group`s net asset value per share rose by 62% to 166.64c from 102.85c previously. On the balance sheet, current liabilities, which consisted entirely of trade payables and provisions, amounted to R248.43 million, against current assets of R196.55 million, of which R72.44 million was cash and bank balances.
CEO Grattan Kirk says the rise in operating profit is due to "excellent earnings" from Incredible Connection and "a solid performance" from Photo Connection.
During the period the group spent R3.7 million on opening new stores and R8.5 million on relocating and refurbishing a number of Incredible Connection and Photo Connection stores.
"Connection Group expects trading conditions to remain positive over the next six months, assuming exchange rates and interest rates remain stable over this period," Kirk says.
"We anticipate good organic growth in the next period with strong demand for the products that we sell arising from the increase in computer literacy in southern Africa, coupled with strong replacement demand.
"Accordingly, the group expects to show appreciable earnings growth for the financial year to 31 August 2005."
The Connection Group share was trading at 920c at noon, up 25c or 2.9% from yesterday`s close.
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