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Bidvest delivers solid performance

Feb 26 2018 17:47
Lameez Omarjee

Cape Town – Bidvest’s [JSE:BVT] diversified offering helped the services, trading, and distribution group deliver a solid performance.

According to the financial results for the six months ended December 31 2017, revenue growth of 10.7% to R39.9bn was reported. EBITDA was up from R3.6bn from the same period last year to R4bn. Operating profit was up 12% to R3.1bn, from R2.8bn reported previously.

Headline earnings per share amounted to 574c, up 12.5% from 510.3c.

“This again demonstrates the benefits of Bidvest’s robust and diverse operating units, which collectively serve many key sectors of the South African economy,” the group said.

However, the group’s automotive division and Bidvest Namibia underperformed.

The automotive division’s operating profit was down 6% to R342.7m. While operating profit from Bidvest Namibia was 67.9% lower than the previous period.

“The Namibian economy, as well as the fishing industry and operational challenges continued to weigh on results. The former is not expected to improve in the immediate future,” the group said.

In turn, Bidvest South Africa’s performance was boosted by the offshore acquisition, Noonan, which came into effect on September 1 2017.

Noonan provides strategic outsourcing to markets in the UK and Ireland. “The Noonan acquisition is delivering as expected and it is already providing the anticipated platform for potential acquisitions, specifically in Europe,” said Bidvest.

The services, freight and office and print divisions were the “stand-out” performers for the group.

Services reported operating profit growth of 24.3%, freight (180%) and office and print divisions (12.7%), the report read.

Outlook

The group anticipates that even though consumers are pressured, there is emerging confidence.

“Bidvest is encouraged by recent political changes in South Africa and believes that the country is on the cusp of a much-needed confidence boost.

“Most divisions within Bidvest are ideally positioned to take advantage of a revival in economic growth and investment,” the group said. 

Board changes

The group announced in a notice to shareholders on Monday that CFO Peter Meijer will be retiring on February 28 2018. The board has approved the appointment of Mark Steyn as CFO, with effect from March 1 2018. Steyn has been the director of Bidvest Freight and has 20 years' service with Bidvest.

The group's share price closed up 0.43% at R236.00 on the JSE.

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