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Adcorp makes R4bn in revenue

Oct 17 2012 18:14
Johannesburg - Employment services group Adcorp holdings on Wednesday reported a 41% increase in revenue to R4bn.

Despite the turbulent labour market in South Africa the company reported a 13% increase in headline earnings per share for the six-month period ending August 31.

Headline earnings per share stood at 127.1c.

The group declared an interim dividend of 60c per share compared to the 57c interim dividend for the previous year.

"The current landscape relating to labour relations in South Africa is extremely turbulent, volatile and uncertain as has recently been witnessed in the mining industry," CEO Richard Pike said in a statement accompanying the results.

"Despite this and possibly as a result of it, demand for our services is relatively buoyant," he said.

He said the group's performance had been pleasing. Revenue and earnings growth were bolstered by the recent acquisition of information technology contracting business Paracon.

Adcorp announced it had forged a formal alliance with the world's second-largest resourcing company, Randstad.

Adcorp's manual labour business continued to perform particularly well despite the ongoing debate about labour brokers. The matter now appeared to be reaching finality as draft legislation had been submitted to Parliament for approval, the company said. This draft legislation proposes to amend the Labour Relations Act and Basic Conditions of Employment Act.

"This new legislation is likely to favour the larger and more established and reputable temporary employment service providers such as Adcorp. Importantly, there is no contemplation of a ban on the practice of labour broking as was originally called for by, amongst others, Cosatu," Pike said.

The Congress of SA Trade Unions maintains that labour brokers promote exploitation of workers.


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