OneLogix Group revenue is hit by car manufacturers' conservative stock holding
ONELOGIX Group, the niche logistics provider, said signs of recovery from the damaging effects of the Covid-19-induced economic environment only became evident well into the year to May 31.
“The impact of Covid-19 should not be underestimated. The impacts included the knock-on effect of international component shortages in vehicle and truck production, with the latter affecting OneLogix TruckLogix and OneLogix VDS in particular,” chief executive Ian Lourens said yesterday.
More conservative stock holdings by original equipment manufacturers (OEMs) had resulted in lower storage revenue of about R36 million, most of which was experienced in the second half of the financial year.
Of current trading conditions he said “the vehicle market is tough” but operations were sound on the agricultural product and equipment side, and in liquid bulk.
Lourens said these challenges were compounded by the mid-year release of the group’s additional vehicle storage facilities in KwaZulu-Natal – on completion of the third phase of the Umlaas Road logistics hub storage facilities – contributing additional costs of R27m in the past five months.
“Nonetheless, each of the 13 group companies are in good health, having weathered the Covid-19 storm. Some have produced a profit improvement, while others remain inherently relevant,” he said.
Revenue fell 6 percent to R2.46 billion. Earnings before taxation, depreciation and amortisation increased 5 percent to R366.1m as a result of cost control measures. He said they planned to make better use of the available real-time operating data to drive better efficiencies in the group. Cost-cutting measures in the past year also resulted in an 8 percent decline in operating and administration costs, excluding share-based payments and retrenchment costs of R9.5m.
Core headline earnings per share (Heps) and diluted core Heps decreased by 39 percent to 13.6 cents. No dividend was declared, to preserve cash, given the uncertain market conditions, although the cash position remained healthy, Lourens said.
In the abnormal logistics operations, OneLogix VDS improved its performance, while OneLogix TruckLogix traded congruently with the impact of a worldwide stock shortage. OneLogix Projex traded ahead of expectations, while the newly acquired OneLogix Agritrans was successfully integrated.
In primary product logistics, OneLogix Linehaul traded well despite a tapering market towards the end of the year, while OneLogix Jackson and OneLogix Buffelshoek delivered satisfactory results. OneLogix UB’s results were below par, but the business was restructured. Cash generated from operations before net working capital inflows, net finance costs, taxation and dividends remained resilient, with a 1 percent increase to R357.8m.
The group invested R227m in owned operational infrastructure during the year: R119.7m in property; R81.9m in fleet, R12.1m in IT-related assets, and R13.3m for other assets.
Net cash resources was R417.7m, well up from R64.5m in May last year. During the year, the group repurchased 3.8 million shares on the open market for R9.6m cash, representing 1.43 percent of the issued share capital.
Lourens said that trading conditions for all group companies were expected to remain difficult for the foreseeable future. “We are experiencing a significant decrease in vehicle stockholding volumes in our storage yards as a result of the reduced stockholding models implemented by the OEMs to navigate current trading conditions, and will continue to monitor the situation closely.”
OneLogix shares closed 0.44 percent higher at R2.27 on the JSE yesterday.