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africa|business|energy|eskom|financial|flow-company|power|rental|solar|supply chain|flow-industry-term

Motus to spend R250m in next 18 months on alternative energy sources

3rd March 2023

By: Irma Venter

Creamer Media Senior Deputy Editor

     

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With no light discernible at the end of the Eskom tunnel, mobility group Motus will spend R250-million over the next 18 months to install alternative energy generation sources, such as solar power, at its facilities.

A global shortage of batteries meant that it was impossible to implement a solution sooner, said CEO Osman Arbee as he delivered his company’s financial results for the six months ended December 31 last month.

He said that Motus had already spent R100-million on alternative energy sources, as it had become clear that there was no short-term solution to Eskom’s power woes.

Motus saw revenue for the six months under review increase by 14%, to R51.2-billion, compared with the same period in 2021. Operating profit was up 22%, to R2.6-billion.

The numbers were boosted by two recent acquisitions in the six-month period, one local and one in the UK.

During October last year, Motus acquired UK-based auto parts distributor Motor Parts Direct, with the aim, among others, to reduce the group’s dependence on new-vehicle sales.

A month later, Motus acquired three Mercedes-Benz passenger dealerships and one commercial vehicle dealership in the northern suburbs of Gauteng, which should generate vehicle, panel, parts and workshop revenue.

The acquisitions carried a R4.4-billion price tag.

“We remain confident that the group’s integrated business model will generate cash, which will allow us to continue to invest in growth opportunities in South Africa and abroad,” noted Arbee.

Motus’ passenger and commercial vehicle businesses, including those in the UK and Australia, retailed 66 147 new units (down from 66 705), and 43 422 preowned vehicles (down from 47 533) during the six-month period.

Importer brands Hyundai, Kia, Mitsubishi and Renault struggled with stock availability, but Arbee said new shipments arrived in January, which should aid sales in the second half of the financial year.

Overall, stock shortages were a thing of the past, he added, apart from selected models.

Looking ahead, Arbee said the South African new-vehicle market should reach between 540 000 and 560 000 units this year, up from 528 963 units last year.

He said this growth would not necessarily flow from “the man in the street”, but from rental companies and corporates returning to the market after Covid-19.

It was expected that consumer and business sentiments would remain under pressure over the short to medium term.

Supply chain constraints, albeit easing, increasing global interest rates and inflation were also set to continue, impacting on the cost of vehicles and parts in the short term.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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