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EOH nears R10bn revenue mark

Paula Gilbert
By Paula Gilbert, ITWeb telecoms editor.
Johannesburg, 16 Sept 2015
CEO Asher Bohbot says EOH's people-centric philosophy will help increase operating margins.
CEO Asher Bohbot says EOH's people-centric philosophy will help increase operating margins.

EOH has continued its trend of strong annual results, today announcing that revenue for the year ended 31 July was up by 35% to R9.7 billion. The growth was due to a combination of strong organic growth and successful acquisitions and the company has no plans to slow down.

"EOH has the people, the scale, the offerings, the financial resources, the agility and the know-how to continue to grow aggressively," according to CEO Asher Bohbot.

EOH says it is in a strong financial position and has sufficient cash resources to ensure sustainable future growth. This as cash increased by 56% to R1.6 billion over the period, while profit after tax increased by 41% to R692 million. Headline earnings per share (HEPS) increased by 29% to 575 cents and a dividend of R1.50 was declared, up 25% from a year ago.

EOH's services revenue grew by 27% to over R7 billion, and now accounts for 72% of total revenue. The revenue derived from software increased by 60% and the revenue from infrastructure products increased by 58%.

Bohbot attributes the technology services provider's success to its "unfailing business philosophy that is centred around people".

"By continually driving its philosophy of recruiting and retaining the best people and its 'Right 1st Time' quality initiatives, EOH expects to maintain and, in time, to increase its operating margins."

The business, which claims to have the "widest offerings in our industry", employs 10 000 staff and has 134 points of presence in South Africa, while its scope stretches to another 32 countries in Africa.

Its portfolio includes a range of outsourcing, cloud, managed services, industrial technologies and business process outsourcing (BPO) solutions.

Aggressive growth

In sticking to EOH's usual approach, strategic acquisitions during the period helped to consolidate and complement its existing services.

"EOH embarked on growing its international IP software business and its service offerings in the financial services, telecommunications, energy and local government sectors. EOH also expanded its activities in Africa by joining forces with Twenty Third Century Solutions ('TTCS')."

The company says growth in its African businesses are expected to accelerate following the deal with TTCS. "EOH is a pan-African company and will continue to grow its business in the rest of Africa."

Other acquisitions during the year included Construction Computer Software Proprietary Limited ('CCS'), which develops and markets software products used by the construction industry. Managed Integrity Evaluation Proprietary Limited, Afiswitch Proprietary Limited ('MIE Group') and several smaller businesses were also attained.

Job creation

EOH believes that all businesses have a responsibility to help solve the problem of youth unemployment in South Africa. The company launched the EOH Youth Job Creation Initiative back in 2012 with the aim of working with its business partners, customers and government to stimulate job creation.

"Our objective is to create 50 000 jobs by 2020. To date the programme has created over 8 000 jobs."

As part of this initiative, EOH launched its Internal Learnership Programme in March 2012. In 2013, 620 young people participated in this programme and in 2014 a further 600 interns were recruited.

"To date, more than 70% of these interns have been permanently employed by EOH. This year another 600 interns and learners are participating in EOH's learnership programme."

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