Johannesburg - Astrapak shares jumped over 5% on Thursday after the packaging company posted a 49% rise in annual profit on continuing operations and after concluding the first phase of its turnaround.
Astrapak said in a statement the first phase of its turnaround has been achieved within the targeted two financial years under new executive leadership.
Astrapak will now be a focused group of nine manufacturing entities, operating within a unified structure and specialising in the moulding and forming technologies of plastic packaging.
"We have re-engineered to maintain leading market positions and
manufacturing scale in core chosen markets. We are finalising the exit
of non-core businesses and will steadily eliminate expenses incurred to
facilitate the turnaround," the company said.
Group revenue from continuing operations increased by 7.8% to R1.4bn in the year to February 28 2015. Polymer tonnage consumed in production increased by 2.4% to 35 470 tonnes, while average selling prices rose by 5.4%. This reflects an element of growth and a change in mix towards higher value production and the elimination of low margin business.
The continuing headline loss per share reduced by 78.4% to 2.1 cents.
Profit before interest, tax depreciation and amortisation from continuing operations rose by 27% to R127.4m. Profit from continuing operations before exceptional items is R61.5m, an increase of 49%.
Net debt associated with continuing operations has fallen by 16% to R193m, giving a net debt to equity ratio of 19%. Net working capital days for continuing operations was 26 days while net working capital days for both continuing and discontinued operations was 31 days, compared to 41 days in 2014.
Cash inflow from carefully executed disposals over the past two financial years has been R227m, with R148m realised in 2015 alone. The group successfully achieved fair value on exit to suitable purchasers.
The ongoing electricity outages are seriously disruptive, with gross contribution lost in the last quarter calculated at R5m. Strikes and the loss of almost one month of production cost a further irrecoverable R30m.
Astrapak shares traded 5.26% higher at 400c in later afternoon trade on the JSE, outperforming a 0.78% rise in the broader market.