– Contribution from operations margin 16,0%
– HEPS up 24% to 76 cents
– Net debt:equity ratio 14%
– NAV per share of 671 cents
– Interim dividend up 23% to 16 cents per share
– Return on net operating assets 28%
Johannesburg, 9 November 2015 – Afrimat Limited (“Afrimat”), the JSE-listed black empowered open pit mining group that supplies industrial minerals and construction materials, today released interim results boasting a 24% increase in headline earnings per share (HEPS). Profits rose to R109 million from R89 million for the 2014 period. Andries van Heerden, the Chief Executive Officer (“CEO”) said, “Afrimat continues to deliver results driven by its diversification strategy as well as its cost reduction and efficiency improvement initiatives. This has ensured that the contribution from operations is up 26% to R161 million, compared to R127 million in the previous period”.
The strong performance of the mineral operations in most regions, despite lower offtake by customers, bolstered the group’s profits during the period under review. Improved efficiencies, cost reduction and the disposal of marginal businesses contributed to this improvement in earnings, but was affected by lower overall sales volumes. Operating expenses included the cost of additional resources which were required to increase the group’s compliance capability and costs associated in the establishment of the Mozambique operations.
Net cash inflow from operating activities amounted to R99 million, up 33% compared to the previous period. Net asset value per share rose to R6,71, an increase of 13%.
Van Heerden indicated that management are pleased with the implementation of the group’s well-integrated diversification strategy. To boost this strategy, Afrimat announced the acquisition of Cape Lime Proprietary Limited (“Cape Lime”), a business with operations located in Vredendal and Robertson in the Western Cape for R276 million. He emphasised that this will be the largest acquisition made by Afrimat since its formation and that the acquisition is subject to regulatory approvals.
The group’s labour relations continues to be satisfactory and management works tirelessly to ensure that a positive climate in the workplace is sustained. The group’s safety performance for the period under review was exceptional and reflects a further improvement.
The Mining and Aggregates/Minerals segment, which makes up about 90% of the contribution from operations, recorded a stellar performance for the six months. This strong performance is largely due to an excellent improvement in contribution from Infrasors and the KwaZulu-Natal operations, whilst the Glen Douglas mine, Clinker Supplies and the Western Cape continue their good performance.
Van Heerden highlighted that new business development remains a key component of the group’s growth strategy and that the dedicated business development team continues to identify and pursue opportunities in existing markets, as well as in anticipated new high-growth areas in Southern Africa.
Looking forward, he indicated that, “Afrimat is well positioned to capitalise on its strategic initiatives, which include continued growth from an excellent asset base, selective acquisitions and greenfield expansion projects. Afrimat has a proven track record of delivery on its strategy”.
In conclusion, he said that, “We expect the group’s growth to be driven by the successful execution of its proven strategy, recent acquisitions and a wider product offering to the market”.
.. Ends ..
Issued for: Afrimat Limited
Contact: Andries van Heerden, Chief Executive Officer (CEO)
Tel: 021 917 8840
Email: andries@afrimat.co.za
Website: www.afrimat.co.za
Account: Keyter Rech Investor Solutions
Contact: Vanessa Rech
Tel: 087-351-3814 or 083-307-5600
Date: 9 November 2015
