Omnia Holdings hands R1 billion in dividends back to its investors

OMNIA Holdings rose almost 6 percent on the JSE yesterday morning after the diversified chemicals group returned R1 billion in dividends to shareholders for the year to end March.

The group declared an ordinary dividend of 200 cents a share – the first since 2018 – and a special dividend of 400c, boosted by a strong cash generation of R2.3bn during the period.

The group ended the year with R1.8bn of cash on hand after it paid down its R1.9bn net debt following the disposal of Oro Agri during the year.

Omnia sold Oro Agri in January to European Crops Products 2 SARL for $146.9 million (R2.1bn), with the proceeds used to settle its net debt.

Oro Agri was reported as a discontinued operation in the results.

Onmia said that its headline earnings per share from continuing operations increased 154 percent to 391c despite the impacts of the Covid-19 disruptions in some of its businesses.

It said the Covid-19 restrictions saw it operting as an essential services provider during the year in segments such as agriculture, mining and chemicals.

Chief executive Seelan Gobalsamy said the better performance could be attributed to a perfect execution of their strategy during the year.

“These results reflect a resilient performance achieved through continued delivery against our strategy in a challenging and dynamic environment that required decisive management action and agility. Our proactive approach to managing all our businesses and the group’s balance sheet has placed Omnia in a strong financial position, allowing us to resume dividends and return more than R1bn to our shareholders,” Gobalsamy said.

Omnia said that its revenue from continuing operations remained stable at R17.8bn while operating profit from continuing operations increased 61 percent to R1.2bn on the back of a solid performance from the agriculture division.

The group said its earnings before interest, tax, depreciation, and amortisation from continuing operations, excluding impairments, increased 24 percent to R2.1bn.

It said the agriculture division was a star performer – growing its revenue 8 percent to R7.8bn and increasing its operating profit 94 percent to R565m.

The group said the mining division reported a stable revenue at R5.2bn while operating profit decreased 19 percent to R287m, partly affected by lower mining production due to December shutdowns, mine closures as a result of Covid-19 and extreme wet weather in certain regions.

It said the chemicals segment recorded a 14 percent decline in revenue to R4.3bn and a 21 percent increase in operating profit to R209m.

Gobalsamy said agriculture and mining fundamentals were encouraging although market challenges and Covid-19 risks remain.

“However, each of our divisions is focused on driving their respective strategies, realising efficiencies and leveraging their trusted market positions to take advantage of growth opportunities,” Gobalsamy said.

Omnia shares closed 1.05 percent higher at R54.85 on the JSE yesterday.