JSE-listed ARB Holdings on Thursday posted a 34% hike in headline earnings per share (HEPS) to 37.62c for the six months ended December 31, mostly owing to a put option International Financial Reporting Standards (IFRS) adjustment.
Nearly 21%, or 5.88c, of the HEPS increase was the positive result of a R13.8-million decrease in the IFRS fair value of the put option liability arising from the option issued to the minority shareholders in 60%-owned Eurolux.
“The electrical division was able to grow its turnover marginally in an extremely challenging market, through the expansion of its Connect branches and the successful pursuit of a number of projects, while the lighting division's turnover decreased owing to retail customers dropping stock levels in line with a decrease in demand,” the investment and property holding company said.
ARB reported a 2.8% increase in operating profit to R107-million in the interim period under review, with an operating margin of 8%.
“Changes in the product mix and the emphasis on trading disciplines ensured that gross profit margin was maintained in a tough trading environment,” it added.
Half-year revenue ticked up 5.4% to R1.34-billion, with the electrical division producing an 8.7% rise to R1.1-billion, offset somewhat by a 6.1% decrease in revenue to R254.2-million from the lighting division.
The electrical division produced operating profit of R70.9-million during the six months to December 31, up 12.8% on the prior corresponding period.
In comparison, the lighting division reported a 17% decline in operating profit to R26.9-million during the half-year under review.
“The group continues to be cash generative, is ungeared and has net cash-on-hand of R226.6-million, after the payment of dividends during the reporting period of R118.7-million,” ARB noted.