Empowerment company Labat Africa has reported a marginal decline in its interim headline earnings a share, which it attributes to costs of repositioning the group.
Labat has restructured its business to focus on four areas, with its main focus on the provision of technology solutions to the private and public sectors.
"Prospects for the individual businesses are excellent," says CE Brian van Rooyen.
Turnover for the six months to 31 August increased 132% to R94.47 million (1999: R40.71 million), while net operating income before interest and tax rose 69% to R14.01 million (R8.29 million).
"Margins have suffered somewhat due to aggressive marketing in a tough market," says CE Brian van Rooyen, who expects the margins to improve substantially in the second half.
"The past six months have been difficult for venture capital, small market capital and in particular for empowerment companies," he adds.
"The retail trade has been hard hit by competition from new sources and the economy in general has faltered."
Given these factors, he says, it is "gratifying to be able to report a very satisfactory set of results for the period".
Attributable income rose 17% to R6.43 million (R5.5 million), while headline and diluted earnings per share declined marginally to 3.5c (3.7c).
The group`s net asset value per share increased to 40c (32c) at the end of the period, while cash and cash equivalents fell to R4.86 million (R20.13 million).
"Traditionally the second half of the year is a better trading period for the group than the first," Van Rooyen says. He expects this year will be no different.
"We are on target to exceed last year`s profit of R14.7 million."
Labat`s share was trading at 25c on the JSE late this morning, up 6c from yesterday`s close.
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