Reunert boosts earnings 30%

JSE-listed Reunert has reported a 30% increase in headline earnings per share for the first six months of its current financial year, and promises continued growth in the second half.

CEO Gerrit Pretorius says a 21% increase in operating profit before depreciation and amortisation is the result of cost controls and improved efficiencies.

"All the group`s operations, with the exception of ATC and Reutech, have achieved topline and operating profit growth," he says.

"The acquisition in November 2001 of additional stakes in Sietel and Nashua Mobile together with last year`s share buyback programme, contributed to Reunert`s growth in headline earnings per share."

Turnover at Reutech fell by 26% and operating profit by 73%, which Pretorius says was caused by a lower order book.

"The recent receipt of a large export contract has improved the outlook for Reutech and revenue and income will return to more normal levels during the second half of the financial year. The bulk of the export contract will run into the 2003 financial year and prospects for further increases in the order book remain good."

ATC reported a loss for the period as a result of weak demand for its optical fibre. However, Pretorius says a major restructuring has taken place at ATC to reduce costs in the light of expected weak demand.

The telecommunications division`s contribution to the results more than doubled in the six months.

"This increase has been achieved through organic growth and as a consequence of Reunert increasing its investment in Sietel to 40%," Pretorius says.

Among Sietel`s achievements are its expansion into Africa, the award of the supply contract for Cell C and the attainment of preferred supplier status for Eskom Enterprises.

The group has declared an interim dividend of 30c per share.