Information technology (IT)and services firm EOH has posted strong interim results for the period ended December 31, 2015, and is accelerating its use of joint ventures and acquisitions to expand its presence beyond South Africa.
The firm grew revenue by 30% to R6-billion, operating profit by 35% to R682-million, and headline earnings per share by 24% to 359c. It also increased cash on hand by 6% to R1.561billion, and attributed its growth to strong organic growth and acquisitions.
EOH continues to grow its footprint – not only in Africa to become a Pan-African business, but also internationally, with a strong focus on the Middle East.
The company will continue to enhance its industry-specific businesses and expand its service offerings in new territories, mainly through forming partnerships and joint ventures, as well as acquiring niche or specialist companies in specific countries, says EOH CEO Asher Bohbot.
All the group’s divisions registered increased revenue, with the systems integration division increasing revenue by 29%, outsourcing by 26%, industrial technologies by 31%, infrastructure products by 7% and software by 87%. Systems integration and outsourcing constitute 59% of revenue.
The software division owns and manages internally developed and acquired niche applications and software for fit-for-purpose and industry-specific uses. The growth in revenue from R454 880 in the corresponding interim period last year to R850 698 is as a result of the company’s drive to sell more of its software and leverage its intellectual property.
EOH sells its own niche software to users across the globe and intends to boost international software applications sales through the establishment of an office in Dubai, says Bohbot.
However, South Africa is by far its most important market in terms of the company’s revenue, with 87% of revenue derived from it, with other African countries providing 9% and the rest of the world 4%.
EOH acquired several smaller businesses to enhance its industrial technologies capability, augment its business process outsourcing services and bolster its IT applications and consultancy businesses. It is also focused on “further expanding into the rest of Africa and the Middle East by acquiring a 50% stake in several small businesses”.
The firm acquired Global Connector Technology group of companies, which focuses on utility management using smart metering solutions, and analytical, forensic and investigative software solutions for the security sector. Rail technology firm Mehleketo was acquired to bolster EOH’s industrial technologies offerings in the transport industry vertical.
EOH has the ability to train, attract and retain the best people and, as a result, to offer comprehensive and complex solutions to its many and varied enterprise and public-sector customers, concludes Bohbot.