Santova’s global spread pays off

Logistics group Santova says its strategy of diversifying internationally enabled it to deliver “meaningful organic” growth in the six months to August.

Logistics group Santova says its strategy of diversifying internationally enabled it to deliver “meaningful organic” growth in the six months to August.

Expansion of its footprint in the Asia-Pacific region and in Europe/UK meant international operations contributed 66.5% of overall profit from 58% in 2016. But overall growth in profit of 27.6% in the period from the group’s logistics operations was generated across all regions, including SA, it said.

Asia-Pacific contributed 32.8% to overall growth in profit; the Europe/UK region 20%. SA added 29.2%, despite the poor domestic economy.

“Had it not been for the strengthening of the South African rand across most currencies in the second half of the 2017 financial year, the group’s overall results would have benefited much more favourably from the translation of its foreign earnings,” Santova said.

Headline earnings per share were up 12.4% from the same period in 2016. The rand had strengthened an average 22.5% against sterling and 12.7% to the euro over the matching period a year ago. But a 32.4% plunge in group finance costs and a 2,5% fall in the effective tax rate — plus an official 1% decrease in the UK corporate tax rate — helped profitability.

Meanwhile, the buyout of the remaining 25% minority interest in Santova Australia meant profit attributable to minority shareholders was cut 96.8%.

GROWTH IN PROFIT FROM ITS LOGISTICS OPERATIONS WAS GENERATED ACROSS ALL REGIONS, INCLUDING SA