Control Instruments returned to profitability in the year to end-December 2002 and is confident it will experience more growth in the current financial year.
<B>Salient figures</B>
Control Instruments results for the year to 31 December 2003.
Previous year`s figures in parentheses:
Revenue: R335.1m (R259.75m)
EBITDA: R27.61m (R8.88m)
Profit from operations: R16.22m (-R2.8m)
Profit before tax: R9.73m (-R8.24m)
Net profit from ordinary activities: R7.84m (-R9.69m)
EPS: 8.9c (-10.9c)
HEPS: 13.6c (-7c)
Dividend per share: 1c (0)
Current assets: R92.56m (R70.36m)
Cash and equivalents: R17.74m (R0.92m)
Current liabilities: R72.94m (R53.3m)
Cash generated from operations: R45.14m (R14.86m)
The group is a supplier of electronic hardware and software products to the international motor industry and the commercial vehicle fleet management markets.
MD Richard Friedman attributes the group`s performance to, among other things, the increased integration of electronic hardware and software solutions in vehicle and fleet management applications and the increased use of electronic systems in all motor vehicles.
The success of SA`s Motor Industry Development Programme has also been cited as a contributor to growth, as has the fact that many of the world`s motor manufacturers are increasing their purchase of vehicles and components from their South African plants and suppliers.
Sales for the year grew by 28.8% from R260 million to R335 million, while earnings before interest, tax, depreciation and amortisation rose by 211% to R27.6 million.
The group achieved a profit of R9.7 million before tax, compared with a prior-year loss of R8.2 million. An after-tax profit of R7.8 million compares with the previous loss of R9.7 million.
Friedman says headline earnings per share, which improved from a loss of 7c to a positive 13.6c, include unrealised foreign exchange losses. They had the effect of reducing headline earnings by 5c a share from 18.6c.
"The group is positive about its prospects for 2003 and is well positioned for the year ahead," Friedman says. "However, it operates in niche sectors of global markets and is therefore subject to local and international political and economic disruptions.
"In addition, because of the timing of vehicle model changes by the automotive manufacturers and other factors over which the group has no influence, including the exchange rate, limited profit growth is expected in the first half of 2003.
"Nevertheless, current projects and order forecasts from customers indicate that the second half of 2003 should produce strong results and consequently overall growth for the year."
Friedman says the group is expanding its facilities and investing in the people and equipment it needs to handle the anticipated growth this and next year.
As a result, a conservative dividend policy has been adopted so Control Instruments is able to fund the growth. A dividend of 1c a share has been declared.
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