Cape Town - Specialist retailer Verimark leapt by over 40% on the JSE on Monday following the release of an upbeat trading statement.
At the time of writing, Verimark had surged 42% to 81c, and - at times - looked set to go higher with sellers even cheekily offering stock at 149c in morning trade. The move in the share price is good news for shareholders who were offered 50c/share in an unsuccessful buyout offer last year.
The trading update estimated that Verimark would produce earnings of between 10.5c/share and 12.5c/share for the year ended February 2010. This is a major turnaround from the loss of 3.4c/share shown in the 2009 financial year.
Verimark directors indicated that the improvement in profitability was driven by a 47% increase in sales - thanks mainly to the introduction of new products and better space utilisation.
Most encouraging was management's pronouncement that "uncertainties around the ability of the new management team to effect the turnaround is now something of the past given the improved trading results over the last few months".
Verimark has battled for the best part of three years to effect a turnaround, something that knocked the company's share price as low as 20c.
- Fin24.com