Super Group, the JSE-listed integrated supply chain management business, has reported a 42% increase in operating profits to R941-million (R664-million in 2006) for the year to June 2007, and a dividend of 40c a share has been declared to ordinary shareholders.
This sound trading performance is reflected by a 15% rise in group revenue to R11 575m (2006: R10 044m) and a 23% improvement in the group margin to 8,1% (6,6% in 2006).
Headline earnings per share rose 15 % to 132,3c (115,1c in 2006). A 24% increase in net finance charges arising out of a 250 basis point increase in prime and the group’s decision to own rather than lease its properties, failed to dull the benefits of the strong trading performance and headline earnings for the period rose commensurately with revenue to R470m (R411-million in 2006).
The group continued to invest strongly in its operating businesses, with R359-million being invested in its industrial products businesses and a further R445-million in its full maintenance lease assets, mainly to support its ongoing City of Johannesburg fleet management contract.
The group also increased its interest in its Australian fleet management business from 70% to 95% and settled the outstanding amount arising out of its purchase of SMB Fleet Management.
The sroup remained cash positive during the period, generating cash of R1,2-billion before working capital requirements, and ended the year with R422-million in cash. Net debt amounted to R1 400-million which reflects a gearing of 65%, excluding full maintenance leasing and non-recourse debt. This figure includes the group’s corporate bond obligations, which matures in June 2008. The corporate bond is an important component of the group’s long term capital structure and a major financial institution is in the process of facilitating the roll over of our corporate bond.
CEO Larry Lipschitz says the results reflect a strong all round performance from the group.
“We are delighted with the strong growth in operating profit to R941 million. The strategic investments made will provide added impetus to future earnings.” he says.
“This encouraging performance is reflective of the intense focus and unwavering commitment of the management and staff within the group. We expect our investments in our industrial products and supply chain businesses to contribute increasingly to performance in the years ahead, together with the upturn in business confidence in the rest of Africa,” says Lipschitz.
“Against this background, we expect to continue to achieve real earnings growth in the year ahead."