Jasco Electronics has issued a trading statement, warning shareholders that — although it has met its commitment to improve its profitability compared to the immediately preceding six-month period to June 2017 – results for the six months to 31 December 2017 continued to be hampered by market conditions.
The company therefore advises that revenue growth for the six months to 31 December 2017 to be between 6,5% and 7,5% higher than the previous corresponding period’s R521,1-million.

However, earnings per share (EPS) are expected to be between 63% and 73% lower (between 1,71 cents and 2,34 cents per share) compared to the 6,28 cents per share for the previous corresponding period.

Headline earnings per share (HEPS) are likely to be between 76% and 86% lower (between 0,88 cents and 1,52 cents per share) than the 6,34 cents per share for the previous corresponding period.

The company states that the difference between earnings and headline earnings growth relates to the change in control in the Kenya business from a subsidiary to an associate, which gave rise to a net gain of R1,7-million or 12% at an earnings level.

Key features of the performance in the last six months include:

* Carriers’ revenue and profit performance was flat due to the subdued telecommunications sector;

* Enterprise’s revenue and profit performance improved on the inclusion of Reflex Solutions;

* Intelligent Technologies’ revenue and profit performance declined due to a disappointing performance in Power ad Renewables due to the continued slowdown in its markets;

* Electrical Manufacturers performed well on steady revenue with improved profitability; and

* International’s progression has been slower than anticipated due to depressed conditions in Kenya and the Middle East, with higher start-up losses than expected.

Reflex Solutions, in which Jasco acquired 51% on 1 May 2017, contributed strongly to revenue and operating profit growth for a full six-month period. However, this contribution did not fully flow through to earnings due to the minority’s 49% share of profits of R4,6 million.