JSE-listed Reunert has posted an improvement of its financial results for the year ended September 30, 2021, on the back of restructuring and productivity improvement actions implemented in 2020.

During the year under review, group revenue increased 19% to R9.57-billion, while operating profit surged from a restated R208-million in 2020 to R1.05-billion in 2021.

Profit after tax was R743-million in the year ended September 30, 2021, an increase from the R84-million reported in 2020.

Headline earnings a share and earnings a share increased from 115c and 29c apiece in 2020 to a respective 478c and 483c a share in 2021.

“The group's companies generally managed the complex and volatile market environment extremely well to deliver solid operating performances, specifically in the Information Communication Technology (ICT) and Electrical Engineering segments, which resulted in an overall financial performance that demonstrates the resilience and responsiveness of our group,” Reunert said in an update to shareholders.

According to the company, all the businesses in the ICT segment performed in line with or slightly better than expectations, while the Electrical Engineering segment's recovery was led by a strong performance from the circuit breaker business which included excellent export growth and improved market share in South Africa.

This was augmented by the cable businesses which benefited from the prior year's actions and much improved factory operational efficiency.

“Consequently, these businesses delivered a positive operating profit against an operating loss in the prior year.”

However, the Applied Electronics segment had a challenging year, as exports reduced owing to a Covid-19-related inability to travel and secure new orders, as well as long delays in the receipt of export permits from the appropriate authorities.

“Despite the positive financial performance, 2021 remained challenging and the group had four key challenges to contend with,” the company reported, noting the Covid-19 lockdowns both in South Africa and in the group's various export markets; the civil unrest in South Africa in July; the delay to secure export permits from the appropriate authorities; and the global electronic component shortage and general supply chain challenges.

“These factors prevented the full recovery of our businesses and continue to impact the group, although we expect this impact to steadily diminish and for the group's performance to continue to improve in the year ahead,” Reunert highlighted.

Reunert expects the South African macroeconomic conditions to continue to steadily improve during 2022, with the Electrical Engineering and ICT segments expected to experience moderately improved market demand on the back of accelerating renewable energy infrastructure investment and the improvement in the South African economy.

“The strength of the underlying businesses in these two segments position them well to continue to grow in such economic environments. Owing to the recent relaxation in international travel restrictions, the Applied Electronics segment has secured new export orders and this should support an improved segment performance,” the company continued.

The group declared a dividend of 207c an ordinary share for the year ended September 30, 2021.