Logistics company the Value Group said on Tuesday it would save cash over the next five years, which it would then use on projects in Africa but not in South Africa.

The group released its results for the six months to August on Tuesday, recording a 6% decline in headline earnings per share.

“Despite tough trading conditions which have manifested in volume decline and pricing pressures, annual escalations in conjunction with increased fuel recoveries and an extended customer base contributed to group revenue growing by 10%,” CEO Steven Gottschalk said.

He said his company had outsourced work to offset high fuel, maintenance and labour costs.

Despite the fall in profitability as evidenced by the slip in headline earnings per share, the group managed to raise revenue 10% from R847m to R936m.

The Value Group’s net asset value per share climbed 14%. Cash on hand rose slightly from just under R64m to about R75m.

Regardless of the decision to hold cash for projects in the rest of Africa, the company still declared an interim dividend of 8c per share, up from 7c in the same period last year.

Mr Gottschalk said, looking forward, the group aimed to benefit from “the substantially higher growth rates achieved across the (African) continent”.

“This expansion will enable the group to service the growth requirements of its customers, penetrate new markets and increase its overall volume base.

“Although sustainable cost-reduction initiatives have been and continue to be implemented, an improvement in the current trading environment (in South Africa) is not expected,” he said.

 

 

Source: http://www.bdlive.co.za