Feb 22, 2012
Packaging manufacturer Transpaco delivers strong performanceBack
© Reuse this
The company’s turnover was boosted by the contribution of Disaki Cores and Tubes, which was acquired in November 2010. Turnover grew by 21.2%, to R552.8-million.
However, headline earnings a share were down by 3.1%, as a result of 3.3-million additional ordinary shares being issued during the period. The increase was owing to Transpaco’s broad-based black economic-empowerment shareholder converting its preference shares into ordinary shares towards the end of the previous financial year.
Transpaco CEO Phillip Abelheim pointed out that there were no further preference shares in issue.
Disaki’s contribution, and stringent control of group operating costs saw operating profit from continuing operations grow by 4.2%, to R63.3-million. Coupled with a strong operational cash flow the group was able to maintain gearing at 7%.
The solid performance reflected management’s focus on innovative growth initiatives and optimising efficiencies. “Keeping a sharp focus on business fundamentals remained key to Transpaco’s ongoing growth. We concentrate on business basics irrespective of trading conditions,” he said in a statement.
He added that Transpaco’s strategy of investing in plant, equipment and information technology infrastructure had increased capacity and ensured the group’s competitiveness locally and against imports. Transpaco recently installed a third line at a cost of R24-million to increase capacity in the growing pallet stabilisation market.
Meanwhile, Transpaco closed underperforming operations during the period. “We made the decision to discontinue our weaker polyvinyl chloride and polyethylene terephthalate operations, which had enabled us to redeploy resources into exciting new opportunities,” Abelheim said.
Transpaco is currently in the process of establishing a high-volume polypropylene recycling facility, reaffirming the group’s commitment to green initiatives. “The recycling of pre- and post-consumer polypropylene will see Transpaco expanding its foothold in the recycled plastics market. Currently the group operates a substantial post-consumer polyethylene recycling division," he added.
Going forward, Transpaco was optimistic, but cognisant of the challenging economic conditions.
Transpaco increased its interim dividend by 7% year-on-year to 31c a share.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Recent Research Reports
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
This Week's Magazine
Projected capital expenditure (capex) in the South African automotive assembly industry should reach a record R7.48-billion this year, says the National Association of Automobile Manufacturers of South Africa (Naamsa) in its 2014 fourth quarter business review. Capex...
After several years of navigating project-threatening red tape and currency fluctuations, the 4.4 MW Bronkhorstspruit biogas power plant, which will supply clean energy to a leading automotive manufacturer in Gauteng, is expected to enter production before June....
South African paper and pulp producer Sappi reported earlier this month that it would build a pilot plant for the production of low-cost Cellulose NanoFibrils, or CNF (nanocellulose) at the Brightlands Chemelot Campus in Sittard-Geleen in the Netherlands.
The long-term outlook for Nigeria is a country that has the potential to be very strong. So affirmed International Monetary Fund (IMF) Nigeria Mission Chief and Senior Resident Representative Dr Gene Leon on recently. "But we are starting from a point of huge...
Poor infrastructure planning and inadequate maintenance are becoming increasingly problematic for new developments and the associated infrastructure required to support such developments. In many urban and rural municipalities, the state of infrastructure has been...