Accentuate anticipates new projects
ACCENTUATE, the AltX-listed flooring and chemicals manufacturer and distributor and water-treatment solutions provider, anticipates possible acquisitions and new large water projects.
Fred Platt, the chief executive of Accentuate, said on Friday a strategic decision had also been taken to continue with the expansion of the group’s flooring portfolio, which would be supported through “possible acquisitions, increasing market presence and marketing”.
The flooring division continues to be the largest contributor to the group.
Platt said the dire water situation in the Western Cape and other parts of South Africa had elevated the topic of water as a scarce but vital commodity.
“The recent media coverage received on this topic has led to the possibility of interesting new water projects, including possible acquisitions and large projects that may be pursued in the future,” he said.
The 40 percent owned water treatment business comprises the Ion Exchange Safic water treatment business, which was a partnership between Accentuate and Ion Exchange India.
Platt said each period the group made inroads into obtaining projects in the industrial sector. The technical expertise from India and on the ground in South Africa was exceptional and structures had been developed for the implementation of major projects that it was currently negotiating. “We are expecting the mentioned developments to deliver positive results in the near future,” he said.
Accentuate on Friday reported a 1.3 percent decline in group revenue to R157.3 million in the six months to December from R159.3m in the prior period.
Platt attributed the decline largely to lower sales from Floorworx flooring business, which contributed 78 percent of group sales, but experienced a 5 percent decline in revenue.
He said production volumes at its East London manufacturing facility were purposefully managed down, because of low demand from government infrastructure, including classrooms and clinics.
The group made an operating loss of R1.59m compared with the R6.1m profit in the previous year, and a headline loss a share of 1.31 cents from the 2.66c profit in the previous year. A dividend was not declared.
Platt said the group’s financial results for the second half of its financial year were in line with the expectations of management, given the macro economic and market conditions in the reporting period, and provided a solid foundation for growth.
“Although Accentuate is excited about the prospects identified, together with a clear implementation plan, we do anticipate the local economy will remain under pressure for the remainder of the financial period.
“However, we are cautiously optimistic for the remainder of the calendar year and excited about future opportunities that a change in leadership and confidence in the South African economy will bring.
“A slight increase in activity is already visible,” he said.
Shares in Accentuate rose 3.33 percent on Friday to close at 16 cents on the JSE.