AEEI feeling optimistic after solid results
AFRICAN Equity Empowerment Investments (AEEI) is excited about its growth prospects after reporting solid financial results for the six months to February.
Khalid Abdulla, the group chief executive, said he was pleased with the company’s performance because all sectors in the group had done well.
“We have grown regularly by 40percent to 50percent year on year, which is not going to change and obviously the listing of the IT group is going to be key for us. We are excited about the growth.”
Continuing to adhere to the group’s Vision 2020 plan, its revenue increased by 47percent from R305million to R449m.
This was mainly attributable to the significant organic growth by the technology and fishing divisions and the acquisition of two companies by the technology division.
Profit before tax for rose by 150percent from R74m to R185m, with improved positive returns from the group’s diversified operations and investment portfolio. Headline earnings a share gained 111percent to 29.53c from 14.02c.
AEEI’s strategic intent to grow its asset base was evident in the 20percent increase in its total asset base to R1.84billion from R1.54bn that flowed from its operational performance and its investments.
Net asset value a share rose 38percent from 156.47c to 216.47c. Net cash generated from operating activities gained 21percent to R35m from R29m.
“I’m also extremely pleased to announce a maiden interim dividend a share of 2c. This adds to the 3.30c we paid for the August 2016 financial year-end.”
Premier Food and Fishing’s (PFF) group revenue increased by 7percent to R182m from R170m, largely because of increased sales volumes in the lobster and squid segments.
PFF’s operating profit improved by 13percent to R25m from R22m.
The group’s Information Communication Technology division delivered strong organic growth and through the acquisition of two IT companies as well as the incorporation of its investment in BT Communications Services (South Africa) under the IT division.
The healthcare division achieved growth in revenue by increasing its footprint to new regions and promoting its product portfolio to other food and hygiene sectors.
Last year espAfrika also launched a new and wholly owned annual event, “The Royal Escape Experience”, which will be held again this year in July.
Performance for the six months was in line with expectations. With less than 20 months in existence, radio station Magic 828 increased its listenership by 43percent in the Western Cape to 100000 listeners while Tripos grew its market share since the previous period, with revenues rising by 69percent to R27m from R16m.
The group’s investments consist of Pioneer Food, Sygnia, Saab Grintek Defence Propriety and British Telecoms (BT).
Abdulla said the group held a 30percent equity interest in BT, in November, the board of director of BT was rearranged, resulting in AEEI having the ability to participate in the policy and decision-making processes and the group obtaining significant influence.
During the review period, AEEI through its technology division acquired 51percent of Headset Solutions and 57percent of Puleng Technologies.
Non-executive chairman Professor Vukile Mehana was proud of AEEI’s solid performance in an especially tough economic operating environment.
“The group has made good on its promises to further improve shareholder value, especially through the listing of Premier Food and Fishing, and is working hard to, among other goals, attain critical mass for listing its technology division in the short to medium term.”
Abdulla said AEEI had a solid balance sheet and its cash flow had improved. “Our business model remains on a firm growth path, investing not only in other companies and market strategies, but in our own people, that will assist us in continuing to deliver long-term value for our shareholders.”
AEEI shares gained 1.35percent yesterday to R3.75.