http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 14.10Change: -0.09
R/$ = 10.74Change: -0.07
Au 1266.44 $/ozChange: 1.57
Pt 1411.50 $/ozChange: 2.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Aug 22, 2012

Imperial logistics business grows despite difficult trading conditions

Back
Imperial Holdings CEO Hubert Brody discusses the company's results for the year ending June. Camerawork: Nicholas Boyd, Editing: Shane Williams
Construction|SECURITY|Africa|CIC Holdings|Components|Imperial Holdings|Imperial Logistics|Imperial-Logistics|Industrial|Industrial Equipment|Lehnkering|Ports|Rental|Security|System|Africa|Namibia|South Africa|Security|Equipment|Food Sectors|Industrial Equipment|Industrial Services|Logistics|Manufacturing|Manufacturing Clients|Manufacturing Volumes|Retail|Security|Service|Services|Steel|Transport|Rhine|Hubert Brody|Infrastructure|Jacob Zuma|Security
Construction|SECURITY|Africa|Components|Imperial Logistics|Imperial-Logistics|Industrial|Industrial Equipment|Ports|Rental|Security|System|Africa||Security|Equipment|Industrial Equipment|Logistics|Security|Service|Services|Steel|Transport||Infrastructure|Security
construction|security|africa-company|cic-holdings|components|imperial-holdings|imperial-logistics|imperial-logistics-company|industrial|industrial-equipment-company|lehnkering|ports|rental|security-company|system|africa|namibia|south-africa|security-facility|equipment|food-sectors|industrial-equipment|industrial-services|logistics|manufacturing|manufacturing-clients|manufacturing-volumes|retail|security-industry-term|service|services|steel|transport-industry-term|rhine|hubert-brody|infrastructure|jacob-zuma|security-person
© Reuse this



Good acquisitions and contract gains have offset the impact of stagnant manufacturing numbers and price competitiveness in Imperial Holdings’ regional logistics business, CEO Hubert Brody said on Wednesday.

The diversified industrial services and retail group’s Southern African logistics business won more contracts from existing and new clients during the year ending June, despite a challenging trading environment.

“Some of the subdivisions, like the tankers business and the general transport and warehousing business actually performed very well. But this is owing to good contract gains, while the markets were difficult,” Brody noted.

The Southern Africa logistics business recorded a 19% growth in revenue to R16.46-billion and 16% growth in operating profit to R910-million for the year ended June.

However, operating margins for the period declined by 0.2% to 5.5%, owing to the acquisition of consumer goods service provider CIC Holdings at the beginning of 2011.

Acquisitions during the reporting period included German logistics firm Lehnkering, 74.9% of dry-bulk shipping business Dettmer Bulk Reederei operating on the Rhine river; 70% of Datadot, a business that uses microdots as a security identification system to protect, among others, motor vehicles and motorcycles; as well as 75% of vehicle accessories and outdoor equipment business Safari Centre.

Brody indicated that manufacturing volumes had been flat in South Africa, making clients more price-sensitive. He added that some of the company’s manufacturing clients had been affected by industrial action at the beginning of the year, especially in the steel, fuel, paper and food sectors.

Meanwhile, Imperial’s construction clients had also been impacted by the slow start of the South African government’s infrastructure development plans, announced by President Jacob Zuma in his State of the Nation Address in February.

Looking north of South Africa’s borders, Brody said the company found that its transport volumes were under some pressure, particularly in Namibia.

“Some of the other transport corridors to other ports in Africa are becoming more reliable…there, is maybe, less reliance on South Africa, which has impacted on certain of the transport routes,” he explained.

However, Brody insisted that notwithstanding increased competition in the Southern Africa space, the company achieved good numbers.

GROUP RESULTS

Imperial achieved a 25% growth in revenue at R80.8-billion and operating profit increased by 25% to R5.6-billion with the group achieving a return on equity of 23% and core earnings a share rising 32%.

The group’s parts, components and industrial equipment businesses increased turnover by 16% to R7-billion. Operating profit was up 23% to R503-million, 9% of group operating profit.

Logistics revenue grew by 34% and operating profit increased by 33%, while the combined distributorship, retail and financial services revenue and operating profit was up 22% and 23% respectively.

Imperial attributed the growth to strong growth in the South African motor vehicle market, strengthening of the market positions of the group’s imported brands and lower interest rates.

The group sold 114 754 new vehicles in the financial year, 19% higher than the prior period, outperforming the South Africa new vehicle market, which grew by about 13% during the reporting period.

The company’s car rental and tourism revenue grew by 15% and operating profit increased by 8%.

“We saw growth across the group; particularly positive is that growth in the logistics business exceeded that of the other businesses because this is the area we want to put particular emphasis on, in terms of expanding our portfolio,” Brody stated.

PROSPECTS

In the short term, Imperial expected trading conditions in the Southern African logistics division to remain challenging. “But many of our good contract gains will start kicking in even more now and make a good contribution,” Brody noted.

The growth rate of new vehicle sales in South Africa was also anticipated to slow, as the base was currently substantially higher. However, the recent reduction in interest rates was expected to support demand.

“Under current conditions, we expect growth in 2013, albeit at a slower rate than what it was in the past year,” Brody said.
 

Edited by: Mariaan Webb
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
 
Latest News
Despite various challenges related to the extraction of shale oil and gas, as countries grow accustomed to the idea, the use of shale as a form of energy will be more widely pursued, international oil and gas market analyst Michael Lynch said on Tuesday. Speaking at...
A consortium led by two Kenyan firms won a government tender to build a 1 000-MW, coal-fired power plant, company officials said on Tuesday, part of moves to satisfy rising demand for energy in East Africa's biggest economy. Kenya suffers from regular blackouts due...
TNPA CEO Tau Morwe
The announcement of the successful bidder for the construction of Durban’s long-awaited passenger cruise terminal was imminent, Transnet National Ports Authority (TNPA) CEO Tau Morwe told delegates at the African Ports Evolution Conference in Durban on Tuesday. ...
More
 
 
Recent Research Reports
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
 
 
 
 
 
This Week's Magazine
South African State-owned defence industrial group Denel has announced its fourth consecutive year of profits. The group's results for the financial year 2013/2014 were recently announced at its head office in Centurion, south of Pretoria. Revenues grew by 17%, net...
There is little opportunity for JSE-listed infrastructure company Group Five to grow shareholder value in the domestic market, says CEO Mike Upton. He says value can still be found in the private sector, in the renewable and industrial power sector, as well as in...
The National Association of Automobile Manufacturers of South Africa (Naamsa) has announced the event dates of the 2015 Johannesburg International Motor Show (JIMS). The event will take place from October 14 to October 25, 2015, at the Johannesburg Expo Centre, Nasrec.
UK engineering support services provider Babcock is set to deliver the largest order of global truck manufacturer DAF’s truck tractors in Southern Africa to bulk carrier road-based logistics company Ngululu Bulk Carriers (NBC), with 133 trucks to be delivered in...
Digital radio communications in the African local government space can open up the world, but have many challenges to overcome, notes integration and migration of legacy radio communications infrastructure with digital mobile radio company Emcom Wireless head of...
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks