In­victa to con­cen­trate on its core busi­ness

The Star Early Edition - - COMPANIES - Sandile Mchunu

IN­VEST­MENT hold­ing and man­age­ment com­pany In­victa Holdings has said that it would con­tinue build­ing on to its core busi­nesses af­ter sell­ing some units that did not fit in with its strat­egy go­ing for­ward.

The group said the strate­gic fo­cus now was to gen­er­ate cash in its ex­ist­ing busi­nesses and to in­vest in sound ac­qui­si­tions that would help to diver­sify its rev­enue streams both within its prod­uct groups and ge­o­graph­i­cally. It sold BSG to Stein­hoff Doors and Build­ing Ma­te­ri­als in Fe­bru­ary in or­der to fo­cus on the core com­pe­tency of the In­victa Group, which are in­dus­trial con­sum­ables, cap­i­tal equip­ment and parts.

It said the pur­chase con­sid­er­a­tion was based on an en­ter­prise value of R732 mil­lion for 100 per­cent of BSG and ex­cluded cer­tain man­u­fac­tur­ing and prop­erty busi­nesses cur­rently form­ing part of BSG, which would be dis­posed of sep­a­rately.

In­victa said it was still wait­ing for ap­proval from the Com­pe­ti­tion Com­mis­sion, which it hoped would be given in the next few months.


“The busi­nesses that make up the In­victa Group have strong fun­da­men­tals and en­joy sig­nif­i­cant com­pet­i­tive ad­van­tage. Man­age­ment will con­tinue to con­sol­i­date the strengths of the cur­rent busi­nesses that make In­victa one of the lead­ing sup­pli­ers of in­dus­trial con­sum­able prod­ucts, cap­i­tal equip­ment and parts in South­ern Africa,” the group said.

In­victa re­ported a 48 per­cent in­crease in op­er­at­ing profit to R1.01 billion for the year to end March, up from R680.98 mil­lion while profit from con­tin­u­ing op­er­a­tions was up 22 per­cent to R575m. Rev­enue from con­tin­u­ing op­er­a­tions rose 9.5 per­cent to R9.6bn while head­line earn­ings per share from con­tin­u­ing op­er­a­tions came in at 466 cents a share, up from 341c as com­pared to 2016.

The group said it achieved these re­sults de­spite the tough trad­ing en­vi­ron­ment which in­cluded high volatility in the rand ex­change rate, the worst drought, con­tin­ued po­lit­i­cal tur­moil and a re­ces­sion in South Africa in the third and fourth quar­ters of the fi­nan­cial year. It would now fo­cus on two seg­ments: the En­gi­neer­ing So­lu­tions, which grew rev­enue by 8.5 per­cent, and Cap­i­tal Equip­ment, which grew its rev­enue by 10.5 per­cent for the year.

The board has de­clared a gross cash div­i­dend of 94.51c per or­di­nary share, and this trans­lated to 167c for the year, up by 18 per­cent from 142c de­clared in 2016. The group said its new branches in Tan­za­nia, the Demo­cratic Repub­lic of Congo and Ghana had started to gain mo­men­tum, ad­ding to the non-South African op­er­a­tions al­ready in place in Zam­bia, Mozam­bique, Swazi­land, Namibia and Botswana.

In­victa shares dropped 0.46 per­cent on the JSE yes­ter­day to close at R54.


In­victa, the listed in­vest­ment hold­ing and man­age­ment com­pany, re­leased their full year re­sults yes­ter­day, declar­ing a cash div­i­dend of 94.51c a share.

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