Electrical, lighting and related products supplier ARB Holdings has boosted its profit for the year ended June by 22% to R123.68-million, and reported a 24% increase in revenue to R1.94-billion.

The group’s operating profit increased by 26% to R160-million.

The cash-generative nature of the group’s operations resulted in ARB Holdings remaining ungeared, with net cash of about R203-million at financial year-end.

The company’s overall gross profit margin improved from 19.6% to 21.9%, reflecting the inclusion of the higher-margin lighting division for the full year, compared to only six months in the previous year.

The lighting division reported revenue of R281-million and an operating profit of R30.5-million.

“These results reflect the combination of strong market share gains, a focus on market improvement and tight cost control,” ARB Holdings said.

Meanwhile, the company stated that the performance of its electrical division, which was the largest contributor to revenue and profits, was disappointing despite revenue rising by 16% to R1.68-billion.

Revenue was boosted by the acquisitions of cable distributor Industrial Cable Suppliers (ICS), in July 2012, and electrical wholesaling company Elekro Vroomen, in January this year, while operating profit increased by 5% to R101-million.

“Significant progress was made in integrating ICS’s and Elektro Vroomen’s operations since their respective acquisitions, but neither are as yet operating at their true potential and improved performances are expected from both in the coming year,” the company stated.

ARB Holdings added that trading conditions were expected to remain tough for the foreseeable future owing to labour unrest and declining commodity prices impacting on the mining sector and public spend.

“The electrical division, however, is well-placed to benefit from a recovery in any of the sectors.”

ARB Holdings reported a 15% increase in headline earnings per share to 39.55c, and an annual dividend of 18% to 16.2c a share plus a special dividend of 10c a share.

Working capital continued to be well managed across all operating divisions, with the group’s net investment in working capital expressed as a percentage of annualised revenue improving to 19.5% from 20.8% in 2012.

Net capital expenditure for the year amounted to R19.3-million, the majority of which represented expenditure on the electrical division’s vehicle fleet.