JSE-listed OneLogix’s earnings a share for the six months to November 30, 2017, increased by 11% to 23.3c, with CEO Ian Lourens commenting on Thursday that this growth was organic in nature.
“This affirms the strength of our growth strategy and the resilient business models of our businesses, which are guided by strong management teams. Over the years, this approach has purposefully been positioned towards diversification,” he said during a presentation of the group’s interim results.
Revenue increased by 15% year-on-year to R1.15-billion.
Trading profit was up 11% year-on-year to R101.5-million, but trading margins declined slightly to 8.9% from 9.1%, largely as a result of increased staffing costs at the corporate head office to facilitate the next phase of growth in the group.
Operating profit increased by 36% from R82.7-million in the six months to November 30, 2016, to R112.3-million in the period under review.
Cash generated from operations before working capital changes, net finance costs, taxation and dividends remained strong and increased by 8% to R167.9-million, mainly in line with trading profit growth.
An interim dividend of 6c a share was declared.
The company’s Abnormal Logistics segment – comprising OneLogix Vehicle Delivery Services (VDS) and OneLogix Commercial Vehicle Delivery Services (CVDS) – performed well on the back of a moderate upturn in the local and cross-border vehicle markets.
“VDS’s efficient processes and superior service levels, underpinned by an improved service infrastructure, drove an uptick in performance despite an unfortunate strike early in the period, while CVDS benefitted from a last quarter improvement in the market,” Lourens said.
He further commented that OneLogix Projex had suffered relatively tougher trading conditions with resultant margin pressure.
“Fortunately, the business successfully counteracted this with strong financial controls and incipient success in the pursuit of new markets and customers.”
Listless markets and attendant margin pressure were more pervasive within the Primary Product Logistics segment, particularly affecting OneLogix United Bulk and OneLogix Linehaul.
However, movers of top-end niched agricultural products, OneLogix Jackson and OneLogix Buffelshoek, performed well as their specific market benefitted from a recovery from a prolonged drought.
Other Logistics Services, the smaller nonreportable segment, delivered a strong performance, with Atlas 360 consolidating its prior year turnaround and OneLogix Cargo Solutions producing a pleasing performance in the warehousing and project-based clearing and forwarding markets.
Lourens noted that the continuation of difficult market conditions was expected, but that these will be countered by the experienced, stable management teams with their proven entrepreneurial skills that continue to guide the businesses to growth.
He added that the tested business models have ensured that market positioning is strong and that these businesses are able to withstand economic headwinds.
“OneLogix remains alert to opportunities in the market to begin start-ups and acquisitive opportunities and will continue to assess these appropriately,” he said.