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Grindrod to post 188% earnings growth for H1

18th August 2022

By: Marleny Arnoldi

Deputy Editor Online

     

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Further to a trading statement published on June 28, JSE-listed freight and logistics group Grindrod in an August 18 release says it now expects, with greater certainty, to report earnings of between R370-million and R400-million for the six months ended June 30, compared with a R424-million loss in the corresponding six months of 2021.

Earnings a share will be between 55.5c and 60c, against a loss a share of 63.1c in the prior comparable half-year period.

This marks an improvement in earnings and earnings a share of between 188% and 195%.

The company says the six months under review were underpinned by strong mineral commodity markets and favourable net interest margins for Grindrod Bank.

The company’s Ports and Terminals division achieved earnings growth of more than 100% on the prior half-year, owing to an increase in volumes handled.

The volumes that Grindrod handled at the Maputo port grew by 30% to 12.3-million tonnes, on the back of upgraded berth infrastructure to handle 36.4-million tonnes at the port, compared with a prior berth capacity of 24.5-million tonnes.

The port had spent $110-million on its chrome and ferrochrome slab capacity expansion, rail offloading facility, port/road infrastructure and berth rehabilitation.

Grindrod’s dry bulk terminals grew volumes handled by 52% year-on-year, despite disruptive weather challenges, frequent power outages, a fire-damaged conveyor belt incident in Richards Bay, and a loss of 20 vessel loading days in Matola, owing to a berth infrastructure incident.

Meanwhile, Grindrod’s coasting shipping and container depot business performed well, under the Logistics division. All of its container depot facilities were, however, impacted by severe flooding in April, resulting in damages of R51.4-million to infrastructure, which has been impaired.

Grindrod has since recorded interim asset insurance claim proceeds of R100-million, which will be used to replace damaged equipment and infrastructure.

The company reports that its 75 000 m2 container park development project, in Johannesburg, is progressing well and is on track to be completed in the second half of the year. The project has cost R118-million to date, but is central to providing solutions for shipping line customers serving the hinterland.

Grindrod Bank states healthy growth in its earnings this year, underpinned by the higher interest rate environment.

The bank’s liquidity surplus at the end of June was R6-billion. It maintains a stable lending book of R8.3-billion and achieved deposit book growth of 4% to R11-billion in the six months under review, compared with the preceding six months.

Grindrod will publish its interim results on or about August 26.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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