Metrofile pays maiden dividend

Record storage company Metrofile has introduced a dividend for the first time, after improving its financial structure and cash flows.

Metrofile yesterday released its results for the year to June. The company says revenue gained 12.4%, to R460.6 million, while it improved cash generated from operations by 15.1%, to R150.2 million.

Lower finance costs aided the company's after-tax profit, which grew to R73.9 million from R53.3 million. Headline and basic earnings per share increased 38.2%, to 18.1c.

“The improvements in the group's financial structure and cash flows have enabled the board to introduce a policy of paying interim and final dividends for the first time,” says Metrofile in its results announcement. It paid a 4.5c dividend.

Metrofile is in the information and records storage management space in Africa, and is represented in the six major provinces of SA, Mozambique and, through the CSX brand, has contracts in numerous other African countries.

The company operates from 26 facilities covering more than 73 000m² of warehousing space, managing more than 21 billion records on behalf of its customers.

It offers services such as active records management, image processing, hosting, data backup, confidential records destruction, as well as paper recycling. It also sells and maintains a range of business equipment, including scanners, library security systems, mailing and packaging machines.

Metrofile is optimistic it can continue to grow earnings, dividends and cash flows. The company points to the partial recovery in the economy, the growing need for reliable and cost-effective records management, its ability to handle volumes, as well as its basis for expansion into Africa as positive signs.

The company's expansion into Africa, driven by the demand from existing customers, has been slow as it has had to wrap up partnership agreements, the firm says. The need to make sure the expansion is as low risk as possible has also slowed the process.

However, Metrofile has wrapped up a deal with security group G4S to partner with it in Nigeria, which is expected to start trading next month. “The expansion into other African countries will commence once the Nigerian business is fully operational,” it says.

The company's shares closed 2.56% higher at 200c, a 5c gain on the day.