Reunert welcomes the new political administration appointed at the ruling party’s elective conference in December 2017. Reunert recognises the commitment, and subsequent action taken towards ethical leadership, inclusive growth and improved economic growth. We believe this will translate into improved economic conditions for all South Africans.
Reunert provided FY2018 guidance (as part of its 2017 results overview published in November 2017) on the political and economic changes that may have an impact on the environment in which the group operates. Several adverse changes in the operating environment occurred in the period under review. Reunert’s half year results to 31st March 2018 reflect a 10% increase in revenue and an 8% decline in operating profit (before interest, dividends and empowerment transactions) (“operating profit”). The decrease in profitability is largely due to:
| 1 | The significant strengthening of the Rand against the US dollar (“US$”) experienced since December 2017 which has impacted the group’s profitability on 30% of its revenue which is foreign currency denominated; |
| 2 | An unprecedented reduction in demand from State-Owned Enterprises (“SOEs”) and municipalities which materially impacted the Electrical Engineering segment’s profitability; and |
| 3 | The country liquidity constraints in Zambia. |
| Measure | Units | Six months to 31 March 2018 | Six months to 31 March 2017 | % |
| Group revenue | R million | 4 841 | 4 421 | 10 |
| Group operating profit (before interest, dividends and empowerment transactions) | R million | 567 | 616 | (8) |
| Operating margin | % | 11,7 | 13,9 | (16) |
| Profit for the period | R million | 448 | 469 | (4) |
| Headline earnings per share | Cents | 275 | 275 | 0 |
| Normalised headline earnings per share | Cents | 276 | 292 | (5) |
| Q1: Average exchange rate | Rand:1 US$ | 13,61 | 13,90 | (2) |
| Q2: Average exchange rate | Rand:1 US$ | 11,95 | 13,22 | (10) |
| Period end exchange rate | Rand:1 US$ | 11,84 | 13,14 | (10) |
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, Sweden, the USA, Zambia and Zimbabwe. Reunert’s registered offices are located in Woodmead, Johannesburg, South Africa. |
Incorporated in the Republic of South Africa |
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Unaudited Interim Results 2018 - PDF