As Rolfes Holdings tucks away the acquisition that will open new doors for it, the JSE-listed firm continues to aggressively pursue chemicals and related product opportunities in the mining, pharmaceutical, petrochemicals, animal health and feeds and personal care sectors as it builds a strategic black-controlled industrial group.
The R213.1-million acquisition of Bragan Chemicals, which would be concluded in October, was expected to add new industry entry points for Rolfes’ current businesses and open up new cross-selling opportunities.
Rolfes would spend the year ahead developing regional expansion and export markets for the Bragan products, with a new division established to add value in the food, bakery, beverage, dairy, pharmaceutical and cosmetics industries, CEO Lizette Lynch told Engineering News Online on Monday.
The new food division housing Bragan would drive the new addition’s entry into the beverage sector, with Rolfes providing Bragan with the required broad-based black economic-empowerment credentials.
This followed a year of acquisitive activity, with Rolfes buying out minority shareholders in Tetralon and AgChem Holdings for R12-million and R47.9-million and the subsequent sale of Agchem’s 50% shareholding in Introlab Chemicals and 51% shareholding in Acacia Speciality Chemicals for R12.4-million and R6.3-million respectively.
Strategic acquisitions for the next year would be focused on pharmaceutical, petrochemicals and personal care sectors; water infrastructural development opportunities; and larger companies with intellectual property and established distribution infrastructures across Africa.
The group would expand the footprint of its food, water, industrial and agriculture divisions into Africa, while keeping focus on organic growth by expanding its product basket and range of services, sell into new industries, and develop strategic distribution partnerships in Africa and beyond.
FINANCIAL RESULTS
Meanwhile, Rolfes posted a double-digit surge in earnings for the year ended June 30.
Headline earnings a share increased 30.4% to 38.2c, while earnings a share increased 35.2% to 36.5c for the year under review.
The company’s profit for the year rose to R47.4-million, from R38-million in the prior period.
While the group’s gross profit increased 12.4% to R251.3-million, gross profit margins remained at 22%.
Earnings before interest, taxes, depreciation and amortisation increased from R75.2-million in the 2014 financial year to R88.9-million in the year under review.
Operating profit improved from R64.9-million in 2014 to R79.5-million in 2015 at a margin of 7% of turnover.
Group revenue increased 13% to R1.13-billion, owing to export growth, which contributed R257.4-million to Rolfes’ revenue for the period under review.