A realignment of the portfolio in 2013 has resulted in the bounce-back of JSE-listed Iliad Africa with the first half of the year showing improvements in earnings.

During the six months ended June 30, the building materials distributor, wholesaler and retailer posted headline earnings a share of 30c – a jump from the 0.4c reported in the comparable period the year before.

Earnings per share bounced back into the black during the six-month period under review, reaching 30.3c apiece, compared with a loss of 39c a share for the first six months of 2013.

The improvement in earnings reflected the “continuing benefits” of the group's portfolio adjustments made in 2013, CEO Eugene Beneke said on Tuesday.

The group had reversed the declines seen in the past year by realigning its business and disposing of a number of lossmaking operations as it faced a continued subdued trading environment and marginal recovery in building plans passed – factors that continued to weigh on the group’s revenue.

While comparable store group revenue rose 4.6% to R2.1-billion during the first half of the year, the various adjustments in 2013 led to a total group revenue decline of 3.3%.

Iliad’s earnings before interest, tax, depreciation and amortisation on the comparable stores increased marginally from R77.7-million in the first half of 2013 to R78.2-million during the period under review.

A focus on expense management and the impact of the disposals resulted in a 4.4% decline of the company’s year-on-year expenses.

Iliad pointed to a “challenging” past few years for the building materials supply industry amid low gross domestic product (GDP) growth and increasing inflation.

“Iliad's ongoing focus on procurement efficiency, improving cost structures and the implementation of various portfolio adjustments, has countered these conditions to some extent,” Beneke said.

Increasing interest rates, slow GDP growth and increasing consumer inflation were expected to continue and, while the industry continued to adjust to evolving trading conditions, the market remained “very competitive”.

“The infrastructural efficiencies implemented during the period, stringent performance targets, realignment of the portfolio in 2013 and the implementation of various key strategic initiatives ensure the group is well positioned to capitalise on opportunities as growth gradually returns to the market,” he added.

Iliad did not declare a dividend for the six months.