Reunert achieved positive growth in the 2018 financial year with group revenue increasing by 7% to R10 492 million (2017: R9 773 million). Pleasingly, in a volatile Rand environment, operating profit grew by 3% from R1 497 million to R1 542 million. This was achieved despite a sharp decline in Electrical Engineering’s profitability, driven by improved earnings in both the ICT and Applied Electronics segments.
Electrical Engineering’s decline in profitability resulted from the recessionary pressures in the key infrastructure markets serviced, reflecting as reduced demand from key state institutions, and the poor results of Zamefa (the Zambian power cable manufacturer). Zamefa was adversely impacted by Zambia’s liquidity constraints and the 27% devaluation in the Zambian currency to the US Dollar.
The ICT and Applied Electronics segments performed well, particularly in the second half of the year. The ICT segment improved sales in high category multi-functional printers and had good growth in new total workspace solution sets. Applied Electronics growth was driven by record export sales, the benefit of a weakening Rand in the second half and the rapid expansion of the renewable energy business.
This improvement in profitability, combined with the reduction in the number of shares in issue (due to the continuation of the share buyback programme) resulted in headline earnings per share growing by 4%.
| Units | 2018 | 2017 | % Change | |
| Revenue | Rm | 10 492 | 9 773 | 7 |
| Operating profit (before net interest income, dividends and empowerment transactions) | Rm | 1 542 | 1 497 | 3 |
| Profit for the year | Rm | 1 152 | 1 142 | 1 |
| Earnings per share | cents | 717 | 680 | 5 |
| Headline earnings per share | cents | 703 | 679 | 4 |
| Normalised headline earnings per share | cents | 687 | 697 | (1) |
| Total cash dividend per share for the year | cents | 493 | 474 | 4 |
Group profileReunert manages a diversified portfolio of businesses in the fields of electrical engineering, information communication technologies (ICT), and applied electronics. The group was established in 1888, by Theodore Reunert and Otto Lenz, and has contributed to the South African economy in numerous ways. Reunert was listed on the JSE in 1948 and is included in the industrial goods and services (electronic and electrical equipment) sector of the JSE. The group operates mainly in South Africa with minor operations in Australia, Lesotho, Mauritius, Sweden, the USA, Zambia and Zimbabwe. Reunert’s offices are located in Woodmead, Johannesburg, South Africa. |
Incorporated in the Republic of South Africa |
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Audited preliminary summarised consolidated results 2018 - PDF