Despite facing what CEO Graham Dunford describes as the company’s most difficult year yet, Hudaco Industries is optimistic of maintaining the momentum it built up in the last four months of 2014 well into this year.

During 2014, Hudaco had been negatively impacted by protracted strikes in the mining and manufacturing sectors, the subsequent temporary closures of five businesses, South Africa’s ongoing electricity constraints, which had weighed on Hudaco’s clients, a volatile rand and tough trading conditions, in addition to a R1.4-billion tax dispute.

The five-month Association of Mineworkers and Construction-led strike in the platinum mining sector pushed Hudaco’s comparable earnings per share (EPS) during the first half of the year down 5%, while the second half of the year saw five businesses close, owing to the intimidation and violence emerging from a National Union of Metalworkers of South Africa-led strike.

“In addition, the end of the platinum sector strike has had a long tail, with several mines still not back to full production. With four months then left in the financial year, comparable EPS was 13.4% down on 2013,” Dunford explained on Friday.

However, after regaining ground during the last four months of 2014 and emerging with “a lot of positives after a very bad year”, Dunford said at Hudaco’s year-end presentation that the company would gain from a weaker rand, experience continued growth in export sales and benefit from fewer strikes.

Hudaco’s acquisitive activity during the last year would also strengthen and diversify earnings, with the addition of the R450-million Partquip buyout alone expected to add 177c a share to earnings in 2015.

Further, resolving the tax challenge had lifted the cloud further, despite the agreed R312-million settlement with the South African Revenue Service “wiping out” headline earnings per share (HEPS).

Hudaco posted HEPS of 6c during the year ended November 2014 compared with HEPS of 928c achieved during the prior year. Basic EPS were slashed to 8c during the year under review, from the 930c reported in the 12 months to November 2013.

However, Dunford said it was encouraging that the comparable EPS at 986c in 2014 ended above the prior year’s 983c.

During the year under review, Hudaco posted a 13.6% rise in sales to R4.5-billion, while operating profit rose 5.3% to R494-million.

The company’s profit for the year before the settlement of the tax dispute was up 8% to R330-million but fell to an overall profit for the year of R18-million following the settlement.

Hudaco maintained a dividend of 465c for the 2014 financial year.