Industrial and capital equipment group Eqstra on Thursday said it expected its headline earnings a share and earnings a share for the year ended June 30 to decrease by between 32% and 42%, partially as a result of industrial action at its contract mining and plant rental division, which cost it R135-million in losses.
This division’s profitability was also negatively impacted by about R70-million following abnormally high rainfall during the third quarter of the year and by another R20-million owing to the closure and retrenchment costs of nonprofitable contracts.
“A slowdown in the South African economy and in the mining sector further negatively impacted the plant rental business unit,” Eqstra said.
Further, the group said it expected the performance from its industrial equipment and fleet management and logistics divisions for the full year to be in line with management expectations.
Meanwhile, Eqstra’s board has decided to impair its 32.8% shareholding in Protech Khuthele, which has filed for voluntary business rescue and had trading in its shares on the JSE suspended, by R64-million.
“Eqstra is in discussions with the business rescue practitioner to establish whether opportunities exist to protect our investment,” the group revealed.
Eqstra would release its year-end results on or about September 2.