Pinnacle Technology Holdings has reported a revenue increase of 57% to R5-billion for the financial year ended 30 June.
EBITDA increased by 55% to R323-million, while earnings per share increased by 58% to 121 cents and operating cash flow increased by 123% toR139-million.
In terms revenues, 24% of the growth was organic, with 33% due to the acquisition and incorporation of the Axiz Technology Group and Centrafin.
The growth was despite the impact on pricing of the stronger rand, which averaged nearly 8% stronger in 2011 than in 2010.
Gross profit decreased from 15,1% to 15%, but this was mitigated by better efficiencies in operating expenses with ratio to turnover improving to 8,5% from 8,6%. The lower operating expense ratio is mainly due to synergies already achieved after the merger between Axiz and WorkGroup.
EBITDA increased by 55% to R323-million and net profit attributable to shareholders increased 58% to R220-million. Group net profit improved marginally from 4,4% to 4,5% of turnover.
Headline earnings per share increased by 45% to 117,7 cents per share and earnings per share based on net profit attributable to shareholders increased by 58% to 121 cents per share.
Working capital increased mainly through the acquisition of Axiz and Centrafin which added R258-million at their dates of acquisition. On a statistical level, trade debtors days outstanding improved to 47,2 days after an improvement in the government debt balance in last year’s debtors and in the inclusion of Axiz, whose well controlled debtors are below the group average.
Days stock on hand returned to optimal levels at 42,9 days following the sell down of the stock build up that occurred in 2010 when business volumes fell sharply during the FIFA World Cup.
Cash flow from operations yielded R139-million, which amounted to 65% of headline earnings. Net cash on hand at year-end reduced to R3,7-million. This absorption of cash was largely due to R59-million cash paid by the year-end on the repurchase of 20-million shares from the group’s BEE partner, R83-million disbursed in total on the acquisitions of Axiz and Centrafin, R44-million spent on funding Centrafin’s book and the consolidation of Axiz’s R121-million overdraft on acquisition.