JSE-listed Pinnacle Technology Holdings continued with its strategy of moving into fields other than ICT in the first half of the year.
The group, which yesterday evening reported its results for the six months to December, has been expanding into areas other than ICT, as it views itself as being a specialist in distribution, and not in PCs.
During the period, Pinnacle bought Devfam Fire for a price of between R5 million and R25.3 million, depending on earnings targets. Devtrade distributes high-end electronic security products including fire detection and suppression equipment, public address, CCTV and access control infrastructure.
Pinnacle says the company, which trades as Devtrade, is one of two appointed Bosch distributors in the country. "The acquisition of Devtrade gives critical mass and impetus to our strategic decision to enter the security market."
Earlier this year, the group also bought 90% of JAG Engineering, which designs and makes server racks. Pinnacle says the acquisition will trim its reliance on imports and uncertain local supplies.
Last year, AxizWorkgroup bought e-Secure as a going concern for R5.1 million. It imports and distributes Internet security and network optimisation products.
Pinnacle says, although trading conditions are likely to remain tough, it is confident it can maintain its growth momentum. "Some of the investments in the value-added segments are showing positive signs, which should contribute towards overall group growth."
In the first half, Pinnacle reported revenue up from R2.7 billion to R3.1 billion, while net profit gained to R149 million, from R129.9 million, as all units improved profitability.
In a statement to shareholders, the group said this was a "satisfactory result in a period in which there was minimal growth from acquisitive activity and in which trading conditions remained tough due to the economic situation in SA and globally".
Pinnacle says it continues to reap synergies from merging Axiz and Workgroup, and incorporating the Sharp and Datanet back-offices into Pinnacle Africa. Earnings before interest, tax, depreciation and amortisation gained 16.1%, but some of the increase was lost due to Pinnacle buying back 17.28 million shares from Amabubesi Technology Holdings, at a cost of R130 million.
Pinnacle bought Axiz in 2010, for R150 million, to gain R2 billion in annual revenue.
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