Jasco Electronics Holdings has announced results for the year to 30 June 2018.
Commenting on the results, Jasco’s new CEO, Mark van Vuuren, who took over from the previous CEO on 1 July 2018, says: “Tough economic conditions continued to impact our performance during F2018. Even against this, we managed to deliver improved results.
“Although these improvements were off a low base, I am encouraged that the group has stabilised and reached a more solid foundation from which we can now execute on our strategy to build a sustainable and profitable business.
“As the new CEO, I have reviewed our strategy and way of operating. I found it to be in-principle sound, although I believe some adjustments needed to be made. Following a detailed review, a common set of strategic goals underpinning our strategy was created, which gives a clear direction to our employees on what is required to deliver on our strategy.
“The three strategic goals underpinning our strategy are to improve earnings, develop our people and accelerate transformation, with a focus on broad-based black economic empowerment, as well as the digitisation of our business and the evolution of our portfolio into a smart solutions provider of choice.”
Commenting on the outlook, Van Vuuren says: “Against markets that will remain tough, it is imperative that we now shift from planning into execution mode to deliver against our strategic goals. This will be our key focus over the next 12 months.
“As the new CEO, I am very clear on what we need to deliver. We need to focus on the basics of improving our earnings, addressing under-performing businesses and reducing costs before we can grow. Also, to ensure we remain competitive in South Africa, we need to focus on attracting the best talent in an environment where skills loss to other countries are real and we need to ensure we continue with our transformation journey in the context of requirements in South Africa.”
Revenue increased by 10% to R1,15-billion (F2017: R1,044-billion). This was on small increases in all business units outside of Carriers, as well as a 12-month contribution from Reflex Solutions of R157-million (F2017: R28,3-million for two months). The other acquisition, RAMM Technologies, contributed revenue of R13,3-million for four months.
As the group continues to increasingly invest in technology, measuring earnings before interest tax, depreciation and amortisation (EBITDA) has become a more relevant management measure and allows for improved comparability to Jasco’s peers. On this basis, EBITDA increased by 45% to R81,9-million (F2017: R56,3-million).
The operating profit before net interest was up 28% to R53,7-million from R41,9-million in F2017. This was mainly due to the contributions from Reflex Solutions and RAMM Technologies. Although the organic profit declined, significant cost reductions partly off-set the lower volumes.
Net operating margin of 4,7% was up on 4.% last year. Earnings per share (EPS) was up 8% to 3,9 cents per share (F2017: 3,6 cents per share). Headline earnings per share (HEPS) was up 10% to 2,7 cents per share (F2017: 2,5 cents per share). The weighted average number of shares in issue increased from 226,9 million to 229,1-million shares.
The statement of cash flows reflects an inflow in cash generated from operations before working capital changes of R82,8-million compared to R58,8-million in F2017. This was mainly due to the contributions from the new acquisitions and the higher level of depreciation and amortisation in the current financial year.
Jasco’s net cash in the bank position of R67,9-million decreased from R95,6-million in F2017, mainly due to the working capital demands.