Reunert is pleased to present its results for the six-month period ended 31 March 2023 (H1 FY: 2023), which reflect continued growth in the Group’s financial performance compared to the prior comparative period. This growth resulted from the Electrical Engineering and Applied Electronics Segments delivering excellent operational performances on the back of improved demand for their products and services.

Group results

The Group’s revenue increased by 21% to R6,2 billion from R5,1 billion achieved in the six-month period ended 31 March 2022 (H1 FY: 2022), primarily due to improved cable volumes in the Electrical Engineering Segment, and the growth in sales in the Applied Electronics Segment as demand for renewable energy products continued to increase and the delivery of the defence export order book accelerated.

The Group generated positive operating leverage from the improved throughput and operational efficiencies in the Applied Electronics and Electrical Engineering Segments. The ICT Segment delivered results in line with expectations and the guidance provided in the 2022 year end results. The Group’s operating profit includes the benefit of a R44 million preliminary insurance pay-out for the business interruption caused by the COVID-19 pandemic. Accordingly, the Group’s operating profit increased by 33% to R620 million (H1 FY: 2022: R465 million).

At 31 March 2023, all segments continued to have healthy order books and, while both international and local macro-economic conditions pose increased risk, the Group remains well positioned for the 2023 financial year.

Key earnings metrics

  Six months ended
31 March
2023 2022 % change Year ended
30 September
Revenue Rm 6 203 5 114 21 11 129
Segment operating profit Rm 625 449 39 1 140
Operating profit Rm 620 465 33 1 231
Profit for the period Rm 422 319 32 844
Earnings per share Cents 259 196 32 520
Headline earnings per share Cents 267 195 37 519
Interim/total cash dividend per share Cents 83 75 11 299

Cash resources and liquidity

Higher sales in the last quarter of H1 FY: 2023 resulted in higher trade receivable balances. This, together with further investment into inventory as the Group prepares for the execution of the large export and other orders that will be delivered from the second half of the 2023 financial year (H2 FY: 2023) and into the 2024 financial year, led to the Group increasing its investment in working capital by a further R324 million (H1 FY: 2022: R312 million).

The ongoing cash generation capability of the Group, together with the headroom in its bank funding capacity, provides the financial resources for the Group's operational and strategic initiatives and dividend payments.

Segment review

Electrical Engineering

The Electrical Engineering Segment continued its recent growth trajectory with a strong performance in H1 FY: 2023 as segment revenue increased by 11% to R3,2 billion (H1 FY: 2022: R2,9 billion), while segment operating profit increased by 44% to R218 million (H1 FY: 2022: R151 million).

The Power Cable businesses increased production volumes, in part due to uninterrupted operations in South Africa in H1 FY: 2023, compared to the three-week, industry-wide, wage negotiation strike suffered in the prior comparative period, and in part due to improved demand. The improved business environment in Zambia led to new cable contracts being awarded and a resultant increase in production volumes. The ongoing lean six-sigma initiatives delivered further reductions in unit costs, as over-consumption was reduced, and the increased throughput improved factory cost recoveries. These operational gains were augmented by an improved product mix and delivered higher margins which underpinned the stronger Power Cable earnings.

The Circuit Breaker business increased its local market share, but its exports to the USA decreased due to a combination of delays in project execution from American customers and these customers de-stocking as their supply chains continue to recover. The Australian and European markets continued to grow, however, the volume of circuit breakers exported marginally declined compared to the prior financial year, due to developments in the US market. Importantly, margins improved for the business as the COVID-19 related supply chain cost pressures eased, the impact of the prior financial year’s price increases were realised and consequently, the business was able to achieve an equivalent financial performance to the prior comparative period.

The CBi: Energy line of the business achieved key milestones in the final certification of its product range and the successful launch of the energy management system. The Group continues to invest in CBi: Energy as the business drives towards the scaling of this new opportunity.


The ICT Segment delivered results in line with expectations as segment revenue increased by 11% to R1,4 billion (H1 FY: 2022: R1,3 billion) while segment operating profit increased by 4% to R318 million (H1 FY: 2022: R305 million). The increase in segment operating profit was adversely impacted by the sale of R250 million of Quince’s lease and loan receivables book and reduced minute volume at the Business Communications cluster, due to loadshedding, which offset an otherwise pleasing performance from the remainder of the ICT Segment companies.

In line with the Group’s strategic intent to redeploy funds invested in Quince into higher yielding assets, Quince sold R201 million of its lease and loan receivables book at the end of the 2022 financial year and a further R49 million in H1 FY: 2023. The funds realised were utilised to settle the purchase consideration for Etion Create, however, the reduced lease and loan receivables book resulted in a lower operating profit contribution from Quince in H1 FY: 2023.

The forward-looking assessment for Quince’s lease and loan receivables book, required by IFRS 9: Financial Instruments, incorporated the potential that South Africa’s credit environment will become more challenging due to the combination of expected lower growth, higher interest rates and high inflation. This necessitated an increase of R25 million (H1 FY: 2022: R9 million release) in the allowance for expected credit losses. Importantly, despite the forward-looking expectations of tightening credit conditions, actual credit impairments remained in line with historic levels and no material degradation in collection performance occurred in the period under review.

The Total Workspace Provider business, under the Nashua brand, benefited from its multiple brand strategy and an easing of the supply chain challenges experienced in the prior financial year. These improvements enabled the business to service robust demand from their key small and medium-sized enterprise customer base and product volumes sold improved compared to the prior comparative period. In addition, demand for complementary products and services, especially renewable energy solutions, accelerated and resulted in an improved period-on-period profit performance for the business.

The Business Communications cluster's growth continued to be negatively impacted by loadshedding, which results in a reduction in voice minutes due to customers' inability to make or receive calls. Importantly, there was no further degradation in the volume of voice minutes carried across the network, when compared to the second half of the 2022 financial year (H2 FY: 2022), despite much higher average loadshedding in H1 FY: 2023. This indicates stability for the business even with the increased uncertainty around the country's electricity supply. SkyWire had a positive performance in H1 FY: 2023 as demand for last mile connectivity solutions continued to grow.

The Solutions and Systems Integration cluster delivered a strong period-on-period growth in operating profit, reflecting the positive progress the business continues to make. The integration of the prior years’ acquisitions and continued execution of their strategy – to enable the digital transformation of their enterprise clients – yielded good operating profit and revenue growth. In addition, the cluster concluded the important acquisition of a cyber security capability to augment their solution offering. Cyber Security forms a critical component of digital transformation services and this capability will increase +OneX's client access into the future.

The ICT Segment announced the acquisition of IQbusiness, an independent management and technology consulting firm. This acquisition is subject to the fulfilment of normal suspensive conditions for a transaction of this nature and approval by the competition authorities. IQbusiness has revenues in excess of R1 billion and has key competencies in the financial services, retail and telecommunications industries. The acquisition of IQbusiness, when concluded, will create an expanded service offering and improved technical capabilities for the ICT Segment in the Solutions and Systems Integration cluster.

Applied Electronics

The Applied Electronics Segment had a strong financial performance in H1 FY: 2023 resulting in segment revenue increasing by 49% to R1,6 billion (H1 FY: 2022: R1,1 billion) and segment operating profit increasing by 196% to R163 million (H1 FY: 2022: R55 million).


All the Defence businesses experienced strong performances on the back of the good order books secured in the 2022 financial year. The orders were appropriately executed, aided by a partial easing of the supply chain challenges previously experienced. Strong improvement in period-on-period performances were experienced by the Secure Communications, Logistics and Radar companies and the Fuze business again delivered a strong financial performance.

Etion Create was included in the segment's financial results for the first time and its integration into the segment progressed smoothly. Its management team executed on its extensive order book and delivered a financial performance well in excess of the investment case.

Importantly, the rate of orders received by the segment showed no signs of slowing in H1 FY: 2023 and the executable order book ensures the segment is, largely, at full capacity for H2 FY: 2023.

Renewable Energy

The demand for the Renewable Energy cluster’s products and services accelerated in H1 FY: 2023 as sustained loadshedding continued to plague the country. To ensure that these businesses grow sustainably, investment has been made to enhance human resource and business process requirements at both the battery business, Blue Nova Energy, and the solar business, Terra Firma Solutions. This investment has been made in preparation for further increased demand and resulted in higher costs in the businesses. Despite this investment, revenue and operating profit increased in H1 FY: 2023 and the overhead investment is expected to enable sustained and accelerated growth into the medium term.

Events after the reporting date

Shareholders are referred to note 14 for the detail disclosed regarding the events after the reporting date.


Reunert is well positioned to deliver an improved full year financial performance for 2023. The financial performance for H2 FY: 2023 is, however, not expected to replicate the rate of growth experienced in H1 FY: 2023 due to the strong financial performance delivered in H2 FY: 2022.

The full year prospect is supported by the level of orders received in both the Electrical Engineering Segment, specifically the Power Cable businesses, and in the Applied Electronics Segment. These order books support the revenue and margin expectations and position the two segments to continue to perform strongly in H2 FY: 2023.

The ICT Segment is expected to deliver an improved year-on-year performance on the back of the accelerated growth of +OneX and stable growth from the Total Workspace Provider and Business Communications cluster.

The Group's cash flow remains a key focus area and is expected to support the execution of both the Group's operational and strategic initiatives and enable an increased return to shareholders.

Cash dividend

Despite the Group's increased investment into working capital in H1 FY: 2023 and the economic uncertainty, the Group’s free cash flow generating capacity remains intact. Notice is hereby given that a gross interim cash dividend No. 194 of 83,0 cents per ordinary share (March 2022: 75,0 cents per ordinary share) has been declared by the board of directors (Board) for the six months ended 31 March 2023.

The dividend has been declared from retained earnings.

A dividend withholding tax of 20% will be applicable to all shareholders who are not exempt from, or who do not qualify for, a reduced rate of withholding tax.

Accordingly, for those shareholders subject to withholding tax, the net dividend amounts to 66,4 cents per ordinary share (March 2022: 60,0 cents per ordinary share).

The issued share capital at the declaration date is 184 969 196 ordinary shares.

In compliance with the requirements of Strate Proprietary Limited and the Listings Requirements of the JSE Limited, the following dates are applicable:

Last date to trade (cum dividend) Tuesday, 20 June 2023
First date of trading (ex dividend) Wednesday, 21 June 2023
Record date Friday, 23 June 2023
Payment date Monday, 26 June 2023

Shareholders may not dematerialise or rematerialise their shares between Wednesday, 21 June 2023 and Friday, 23 June 2023, both days inclusive.

On behalf of the Board


Mohamed Husain
Alan Dickson
Chief Executive Officer
Nick Thomson
Chief Financial Officer

Sandton, 23 May 2023