Metrofile seeks expansion

Storage company Metrofile is looking to expand its presence on the continent, as well as make acquisitions.

The company today reported its year-end results for the year to June. It says that - because most of its income is annuity-based - it grew revenue 12.5%, to R371 million, and operating profit excluding exceptional items grew 11%, to R106 million.

CFO Richard Buttle explains that headline earnings per share were impacted by a non-cash item that had to be accounted for in terms of accounting rules. Headline earnings per share on a normalised basis were 23% better, at 12.8c. Leaving in the fair value adjustment on interest rate swaps, headline earnings per share were down 25.7%, to 10.7c.

CEO Graham Wackrill says it is seeking complementary businesses to add to its portfolio. “We want to grow our annuity base.”

The company sees growth opportunities as a result of the King III governance code coming into practice, as well as other regulatory issues that will require companies to backup their documents safely.

In addition, Metrofile seeks to expand further in Africa. Last year, it opened its first African operation in Maputo, Mozambique, through a partnership with local company CVS. The size of the operation should be doubled in the next year, adds Wackrill.

He says the company aims to have an operation running in Nigeria by year-end, and this week a contract in Uganda was extended. R10 million has been budgeted for leasing a building in Lagos and on racking, systems, equipment and training.

“We expect Nigeria to grow to the point where, in five years from now, it will contribute around 20% of our total revenue,” says Wackrill.

Nigerian group Golden Sceptre will have a 40% stake in the operation for an investment of 40% of the start-up costs. Contracts with companies such as Standard Bank and Citibank have already been signed.

Wackrill explains that these sorts of deals are low-cost as they do not require any warehousing facilities as these are often on site, a model Metrofile aims to replicate.

The company, which is 26 years old, employs 943 staff across its nationwide operations. It also aims to grow into the government space, which is a long process, says Wackrill.

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