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Johannesburg - Imperial Holdings fell for a third consecutive day after the South African logistics and automotive company said operating profit will probably decline in the year through June, while trading conditions are expected to remain challenging.
The shares slumped 4.9% to R162.88 per share at 10:15 a.m in Johannesburg, paring gains for the year to 36%. A close at that level would be its lowest since July 25.
The current outlook for the financial year indicates single-digit revenue growth and a "moderate" decline in operating profit for continuing operations, the Johannesburg-based company said in a statement on Tuesday.
Profit on that basis gained 3% to R6.4bn in the 12 months through June.
Chief executive officer Mark Lamberti is pursuing international expansion of the company’s logistics operations, which range from pharmaceutical deliveries in Africa to barging on the Rhine. The company’s other main business is its vehicle division, which includes importing, dealerships and rental operations in sub-Saharan Africa.
Economic growth in South Africa is expected to stall this year, according to the country’s central bank.
"There is no reason to anticipate an improvement in the trading conditions facing Imperial in the short term," the company said.
"We expect volume growth throughout our logistics operations to be subdued, and national new vehicle sales in South Africa to continue to decline in response to declining private consumption expenditure, rising interest rates and tightening credit."
Efforts by Lamberti to simplify the company and sell assets in his two years at the helm have effectively split Imperial in two and in June the company reorganized into new units for the logistics and vehicle operations, each with its own CEO.
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