Despite the tough economic environment, JSE-listed OneLogix achieved an 82% year-on-year increase in earnings per share (EPS) to 52.7c for the financial year ended May 31.
Headline earnings per share (HEPS) and diluted HEPS both increased by 14% to 33.7c.
The increases were realised despite the tough economic environment, the niche logistics provider said, adding that, overall, it has managed to maintain its upward growth trajectory for the financial year.
During a presentation of the group’s results, on Thursday, CEO Ian Lourens said the growth in earnings was “entirely organic” and is testimony to the strength of the company’s strategy and resilience of underlying businesses.
The group, he added, would continue to prioritise building high-quality, high-performance teams in an enabling culture.
OneLogix, which achieved a level two broad-based black economic empowerment (BBBEE) status, also finalised the sale and leaseback of the Umlaas Road properties, in KwaZulu-Natal, as well as the sale of its 49% minority shareholding in DriveRisk during the year.
In addition to the DriveRisk disposal, and the Umlaas Road transaction, OneLogix repurchased 5.2-million shares on the open market for a cash consideration of R15.8-million. These shares represent 1.8% of the company’s issued share capital.
The logistics provider further reported a 16% year-on-year increase in revenue to R2.3-billion for the financial year, which Lourens said is owing to an improved performance in the Abnormal Logistics businesses and the extended fleet capacity in the Primary Product Logistics segment.
Trading profit was up 4% to R168-million, with trading margins having decreased to 7.3% from 8.1%. Although this was largely owing to increased leased asset utilisation, tough trading conditions experienced by OneLogix United Bulk and higher staff costs at its head office to drive continued growth, also had an impact.
Trading profit was also impacted on by a R14.3-million charge relating to the group’s skills upliftment programme. Lourens, however, on Thursday noted that this would be recovered by the learnership allowances afforded by the South African Revenue Service.
This contributed to the effective tax charge of profit for the year, he said.
Operating profit, meanwhile, increased by 17% to R148.1-million, and was boosted by the R16.8-million profit realised on the Umlaas Road transaction and a reduced cash flow, as well as an International Financial Reporting Standards (IFRS) 2 share-based payment charge of R9.6-million relating to the management and employee share participation schemes.
Because of changes to assumptions surrounding the core HEPS performance condition, the management participation scheme charge had decreased.
Profit before tax, excluding capital items, increased by 27% to R117.8-million owing to a decrease in net financing costs. Profit before tax margins, excluding capital items, increased to 5.1% from 4.7% in the previous year.
EPS increased by 82% from 29c to 52.7c owing to the one-off post tax profits from the Umlaas Road transaction and DriveRisk disposal of R12.7-million and R36.5-million, respectively.
HEPS and diluted HEPS of 33.7c were both 14% higher on the back of an enhanced overall trading result, reduced net finance costs and the reduced IFRS 2 charge.
HEPS from continuing operations was up 40% as DriveRisk’s contribution in the prior year is now disclosed as a discontinued operation.
Core HEPS and diluted core HEPS were up by 9% to 40.2c per share, with core HEPS and diluted core HEPS from continuing operations increasing by 31%.
Cash generated from operations before capital changes, net finance costs, taxation and dividends remained strong and increased by 3% to R303.2-million, in line with trading profit growth.
During the year, the group invested R140.2-million in operational infrastructure. This comprised an investment of R89.1-million in fleet, R40.6-million in property, R6.1-million in information technology assets and R4.4-million for other assets.
Additionally, Siyaduma Auto Ferriers has been fully incorporated into OneLogix, after the company acquired the business in January for R16-million.
With a view to accommodating market demand and entrenching a strategic advantage, post-year end, OneLogix bought an additional 40 ha of property adjacent to the group’s present Umlaas Road facility for a cash consideration of R43-million.
A final gross dividend of 5c a share was declared, resulting in an annual dividend of 11c a share.
The company’s Abnormal Logistics segment performed well on the back of a moderate uptick in the local and cross-border markets, Lourens said, with OneLogix’s Vehicle Delivery Service (VDS) performing well.
OneLogix TruckLogix, previously known as Commercial VDS, benefitted from a small acquisition in the second half of the year, while OneLogix Projex remains well-positioned in its market, despite facing tougher trading conditions.
Additionally, Lourens on Thursday said that, effective from February, the group had bought an adjoining property to the OneLogix VDS’s Pomona facility for R16.5-million and made improvements of R11-million to ensure additional office and vehicle storage facilities.
Further value-add customer service offerings are anticipated to be developed on the site, he said.
The Primary Product Logistics segment, comprising Jackson and Buffelshoek, performed well owing to the drought coming to an end, as well as to astute management, Lourens said.
He explained that OneLogix United Bulk was impacted on by a listless market and experienced margin pressure as a result, but that it persists with judicious financial controls.
“The business will also continue pursuing new opportunities,” he said, adding that in contrast, OneLogix Linehaul had benefitted from a marginal improvement in market conditions late in the year.
The smaller, non-reportable segment, namely Logistics Services, delivered a good performance, according to Lourens, with Atlas 360 performing as expected.
OneLogix Cargo Solutions is continuing its “pleasing performance” in the warehouse and specialized clearing and forwarding markets, he added.
Looking ahead, Lourens said trading conditions for all of OneLogix’s companies are likely to remain challenging for the foreseeable future, notwithstanding “minor and irregular upticks experienced in certain markets” in the year.
“We will, however, continue to extract maximum efficiencies from our existing businesses to protect and grow their individual market shares in their respective niche markets. The executive management team is completely confident that our experienced, stable management teams with their proven entrepreneurial skills will continue guiding our business to ongoing growth,” he elaborated.
Lourens noted that the company’s stronger financial position and improved BBBEE accreditation provides the company with an ideal springboard for pursuing growth going forward.