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Set Point records turnaround

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Scientific and industrial group, Set Point Technology Holdings Limited (Set Point), has announced its interim results for the six months ended 29 February 2008. Recent consolidation within the business and a redirection to focus on its core capabilities has reaped significant benefits evident by its improved results.

Profit before tax is up 123% to R32,8-million, while headline earnigns are up 137% to 6,3 cents per share.
Set Point recorded revenues of R177-million for the six-month period ended February 2008, 25% higher than revenue from continuing operations in February 2007. Headline Earnings per share echoed the turnaround, increasing from a 1,6 cents per share loss in 2007 (2.7 cents per share from continuing operations) to 6,3 cents per share in 2008. Operating profit increased by 87% to R32,8-million from continuing operations.
Set Point focuses on three core activities: Analytical Services, Fluid Handling and Mining Services.
Analytical Services operates through specialised laboratories offering expert chemical analysis for the precious metals exploration industry and condition monitoring of fluids. Sustained business activity particularly in the mining exploration arena reflected in an increase in operating profits of 107%.
The Fluid Handling division, which supplies pumps, valves, couplings and flow meters to the petrochemical and mining industries, increased revenue by 12,9% to R81,6-million. Operating profit increased by 20% with all businesses producing particularly pleasing results.
Following the sale of various business activities, Mining Services has been rationalised and now consists solely of the manufacture and repair of hopper wheels, skip and cage guides and rollers. Results from this operation are ahead of budget and this trend is forecast to continue following recent improvements in production processes.
CEO of Set Point Technology, Graeme Horsfield, comments: “The Set Point Group has, after past setbacks, recovered remarkably and we are extremely satisfied with our interim results. Our recent acquisition of the minority interest in Rogene Pumps, resulted in all divisions being wholly-owned. This was part of our strategy to curb administrative costs and streamline economies of scale throughout the business.”
Although some inconvenience is being experienced with Eskom’s load-shedding, particularly in Rustenburg, Set Point is making the necessary investments in alternative energy supplies to minimise future disruptions in its operating units.
“Set Point Laboratories recently received a ISO 17025 accreditation and accreditation from the National Nuclear Regulator of South Africa to analyse uranium in naturally occurring radio active isotope bearing materials. We expect this to add an exciting new dimension to the divisions’ capabilities that will result in a significant additional revenue stream,” says Horsfield.
During March 2008 Set Point also opened a third WearCheck laboratory. WearCheck Africa is one of three analytical operations in Set Point. The division monitors the condition of oil and lubricants for the earthmoving, industrial, transport, shipping and aircraft industries through scientific analysis of used oil from mechanical and electrical systems.
“All of the group’s divisions are achieving profit growth and central costs are being well contained. Accordingly, we anticipate substantial growth in HEPS for the full year. We will continue to seek out opportunities to grow both organically or by acquisition and add value to our shareholders,” says Horsfield.
Set Point has declared an interim dividend of 2 cents per share.