Good six months for Jasco

By Iain Scott, ITWeb group consulting editor

Johannesburg, 31 Oct 2005

Jasco Holdings has reported headline earnings of 10.6c per share for the six months to August, 43.2% up on the 7.4c for the same period a year earlier.

CEO Joe Madungandaba says the main drivers behind the growth in earnings were a 22.7% increase in revenue, a reduction in interest paid and further improvement in efficiencies in the group`s core operating divisions.

He adds that Jasco traditionally delivers stronger figures in the second half of the financial year and management is expecting, in the absence of unforeseen circumstances, a further improvement in results at the end of the year.

Revenue rose from R122.01 million to R149.72 million, while the operating profit climbed 36.5% from R7.39 million to R10.09 million.

The group achieved a R6.8 million profit for the period, 31.4% up on the R5.14 million for the six months to end-August 2004.

The net asset value at the end of the period amounted to 138.2c a share, compared with 125.7c a year before. Jasco`s net tangible asset value of 84.7c a share compared with a year-earlier amount of 76.1c a share.

Debt-to-equity levels dropped, with gearing at 2.8% at the end of the six months, compared with 14.2% a year before. Madunganadaba says cash generation from profits in the second half will eliminate gearing at the year-end.

The balance sheet shows current assets of R101.83 million (of which R33.64 million was made up of inventories, with zero cash) compared with R85.95 million previously (of which inventories accounted for R26.26 million and cash R2.6 million).

Current liabilities amounted to R66.49 million, against R61.37 million previously. Interest-bearing liabilities fell to zero from R14.18 million.

"The group continued to generate cash from operations, although the R4 million of cash generated during the period was slightly lower than the R6 million during the corresponding period," says Madungandaba.

"This was due to the 23% growth in revenue during the first half of the year, which will result in stronger cash inflows in the second half of the year."