Johannesburg - High fuel prices have dented operating profit at specialist logistics service provider OneLogix, which reported results for the interim period to end-November 2008 earlier on Tuesday.
OneLogix, which is listed on the JSE's Alternative Exchange, posted a 31% increase in revenue to R327m. Operating profit increased 16% to R38.4m.
"Revenue grew disproportionately to operating profit due to significant increases in the fuel price during the period," says the group. The company's operating margin contracted from 13.3% for the first six months of financial 2007 to 11.7% for the period under review.
Basic and fully diluted headline earnings per share increased 15% to 8.3 cents.
OneLogix's logistics division - which comprises 96% of revenue - performed in line with expectations in a hostile environment, with revenue increasing 31% to R313m. The logistics business manages the transportation of commercial and consumer vehicles within South Africa and surrounding regions.
Group CEO Ian Lourens says that the vehicle market has contracted significantly. The next six months could be even more challenging. South African vehicle sales fell 35% in the January, their biggest drop in 25 years. Industry observers and economists see little scope for a real recovery before the year-end.
OneLogix expanded into commercial vehicle distribution services towards the end of 2007. "The business is performing relatively well given the circumstances," says Lourens.
The PostNet division - which offers copy, print and courier services to small businesses and individuals - is proving to be reasonably resilient to the downturn, according to Lourens.
The group was awarded the distribution rights for the second national operator Neotel in 2008. Lourens says the partnership is starting to take off, with Neotel extending its product range and improving coverage.
Lourens says trading conditions are very difficult, and adds that he is not "expecting fireworks in the interim". The company will focus on getting the basics of its business right to weather the economic storm.
"We need to make sure our business processes are operating as effectively as possible. We are also implementing cost control, but only to the extent to which customer service is not compromised," he says.
The company expects the economic slowdown to offer opportunities in terms of acquisitive growth.
"We are very much still looking at acquisition opportunities," says Lourens, adding that the group is keeping an eye out for acquisitions adjacent to its business but probably not in the vehicle sector.
- Fin24.com