Integrated rental, fleet management and logistics group Barloworld has reported a “steady” operational performance by its various business divisions in the first quarter of the 2015 financial year, with most units trading above or in line with the prior comparable period.

The group’s Southern African equipment and handling division delivered a “pleasing” result for the quarter ended December 31, despite declining commodity prices and reduced mining capital expenditure.

Improved performance in Mozambique as well as strong activity in the extended mining product range in Zambia and Namibia contributed positively to the result, while aftermarket activity remained “solid” and ahead of the prior year.

The December order book for Southern Africa was marginally down on the previous  comparable quarter, Barloworld said in a trading update.

Elswhere, the group reported that the combination of the oil price decline, a weak local currency and the impact of sanctions in Russia adversely impacted economic growth and created a complex and challenging operating environment for its equipment and handling business in the country.

“As a result, trading in the first quarter is well below that of the prior period. While remaining at low levels, the December firm order book [for this division] is up on September last year, following certain contract awards,” the company outlined.

The Iberian business had, meanwhile, traded at close to a breakeven level in the first quarter following the action taken last year to lower the cost base.

The December order book for this division was in line with that of the prior quarter.

Barloworld added that its handling and agriculture businesses were trading broadly in line with the prior period.

“There are currently no changes to the 2015 revenue outlook ranges provided for the equipment and handling businesses at the time of releasing our year-end results. However, there is some increased risk in relation to the Russia performance as a result of economic developments over the past few months,” it cautioned.

AUTOMOTIVE & LOGISTICS
The group’s automotive and logistics division performance was, meanwhile, solid in the first quarter, driven mainly by the motor retail and car rental businesses.

With regard to car rentals, the number of rental days and the rate paid a day were ahead of last year’s figures, contributing to a good trading performance, while the fleet services business was in line with the prior period.

“Logistics faced a weaker trading environment in the first quarter, but some notable supply chain management contract wins are likely to contribute to an improved performance over the balance of the year,” said Barloworld.

WORKING CAPITAL & FUNDING
In line with past trends, the group saw an increase in working capital to fund inventory in the first quarter.

This contributed to higher net debt that was expected to decline over the latter half of this financial year