DIG AROUND

Finweek English Edition - - SIMON SAYS -

Torre re­sults look great on the sur­face, wit h HEPS up 118 %. Delv i n g deeper we see op­er­at­ing prof its up at R72m com­pared to t he pre­vi­ous half ’s R20m, so an im­pres­sive R52m i ncrease. How­ever, R16m of t hat in­crease was “as a re­sult of a once-off ad­just­ment to the Trac­tor and Grader Sup­plies ( TGS) de­ferred pur­chase con­sid­er­a­tion l i abi l i t y ”. I n ot her words, it has noth­ing to do with the busi­ness and is not re­peat­able, so it should be re­moved from the num­bers. If t his i s done, op­er­at­ing prof it i s R56m and HEPS drop by more than a third (HEPS were R46m). So rather than a 118% in­crease in HEPS, we get HEPS at some 9. 2c com­pared to t he pre­vi­ous si x months’ HEPS of 6.6c, a 40% in­crease. This is still good and with a maiden div­i­dend, but as al­ways, make sure to take a closer look at the num­bers.

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