The economic slowdown has had minimal impact on Metrofile's results for the period ended 31 December, with the company enjoying continued sales growth.
Metrofile has reported a 10% increase in revenue, while reducing finance costs for the period by 15%. Normalised HEPS also increased by 16% for the period.
Metrofile is also continuing with its capacity building exercise, and is on track to meet the targeted 25% increase in capacity across the country having completed 50% of stated expansion plans during the six month period at an investment of R29,5-million.
Good growth continues to be experienced in Africa with demand for equipment and services holding up well and the business in Mozambique growing steadily.
Revenue increased by 10% to R179,7-million and EBITDA was up 9% to R58-million.
Headline earnings per share (HEPS) reduced by 19% to 4,44 cents after adjusting for a number of once off items that arose from the restructure of the old MGX Group, and after accounting for changes in the fair value of the interest rate swaps; the changes would have been accounted for through the NDR if hedge accounting had applied. Normalised HEPS for the period increased by 16% to 6,17 cents compared to 5,31 cents in 2007.
If the swaps had been able to be hedge accounted under IFRS, this charge would have gone under the NDR. The cash flow benefit from the swaps amounted to R4,052-million for the six month period and has totalled R8,222 -million over the period of the swaps to date. This is reflected in a separate line in the income statement and treated as a credit to interest paid.
Commenting on the unaudited results for the period, Metrofile CEO Graham Wackrill says: "The results to date are pleasing for us as a group, and we are happy that we have been able to further drive down finance costs. The business foundation remains solid with good annuity revenue plus our investment in capacity building is starting to pay dividends.
"We are very happy with the growth we are experiencing in Africa through CSX, as well as through Rainbow our paper recycling business," Wackrill adds. "In addition, our consulting and training arms are also experiencing significant growth barely 18 months after their launch. I can comfortably state that Metrofile as a group will continue to buck the downward economic trend and that we will experience continued growth for the foreseeable future."
The company is also repositioning the brand in response to customer feedback.
Wackrill says: "The Metrofile brand has always enjoyed a good reputation however we felt it was important to respond to the feedback of customers, as it was to make changes that were more reflective of and in-line with where the business is going. We believe that these changes will, along with our capacity building programme and the development of our systems and people, place the company in a very strong position to take advantage of future business opportunities."
Looking ahead, Metrofile expects the new Companies Act and King III report to have a impact on the growth of the business. Growing emphasis on the need for transparency, good record keeping and corporate governance is also expected to boost the business as companies continue to look for a trusted partner to handle their information and records management particularly during these tough economic times.