In a record interim performance, Altx-listed logistics group OneLogix has outdone its results track record with a 98% increase in interim revenue to R80 million and a 33% leap in interim operating profit to R10,3 million. Strong organic growth in subsidiary Vehicle Delivery Services (VDS) and the 4Logix acquisition were the key growth drivers during the six months to November 2005.
CEO Ian Lourens points out that notwithstanding the significant revenue growth, debtors days are still well-controlled and have remained consistent. Operating profit was higher despite a once-off cost of R0,75 million to execute the BEE transaction that saw a consortium led by Sipho Pityana’s Izingwe Capital (and including OneLogix black employees) acquire a 25% stake in the group’s wholly-owned management company. Headline earnings and earnings per share both rose 52% to 3,8 cents a share from 2,5 cents at this time last year.
Notwithstanding an increase in working capital to match the surplus revenue generated during the period, cash from operations grew to R9,5 million from R5,3 million.
Lourens says that the approximate R9,7 million investment in VDS over the past year was vindicated during the period by its performance in the local auto logistics market. “While VDS is an accepted leader in the cross-border auto logistics market, the past six months have seen the business successfully establish a strong presence locally.” He says that to meet demand for increased carrier capacity and entrench VDS’ presence in the local market, OneLogix will continue to invest substantial capital in the business over the coming year.
Specialist in rail logistics for bulk commodities, 4Logix, and its black-empowered subsidiary Gijima secured a number of profitable long-term contracts which Lourens says have contributed well to group revenue growth. The 4Logix group is active in the growing market of raw materials export through SA’s ports.
Of Postnet Lourens says: “the SMME market is major growth node in SA, which makes Postnet’s strong brand and established presence in this market a major contributor to the group’s future growth prospects.” The revitalisation of Postnet’s brand has reinforced the business’s position as a leading supplier in the business solutions niche.
Lourens adds that the group has identified an avenue to counter cost-consciousness in the media distribution market, which continues to squeeze profit margins at Media Express. “The business will diversify in the period ahead into related markets with strong profitability. We are confident that a solid management team focusing on expense control and capitalising on organic growth opportunities should drive an improvement in performance.”
He is optimistic for the period to year-end. “Although we traditionally generate stronger revenues in the first half of the financial year, we are confident of real growth in HEPS for the full financial year ending in May 2006”. He says too that OneLogix’s enhanced BEE platform should benefit the group both from an earnings and operational perspective. Sipho Pityana has joined the OneLogix board as the new non-executive chairman while Tsakani Matshazi has been appointed a non-executive director.
OneLogix shares closed yesterday at 69 cents.
Issued by: Envisage Communications
(011) 325 5944/083 287 2771
On behalf of: OneLogix Group Limited
Ian Lourens, CEO
(011) 396 9040/ 082 440 9683
Issue date: 24 February 2006
OneLogix owns the niche business solutions supplier PostNet. The group further includes auto-logistics specialist Vehicle Delivery Services, an established leader in cross-border transportation of vehicles into Africa which also recently debuted successfully onto the local auto-logistics market. Media Express is responsible for the overnight distribution of many of SA’s major business newspapers and magazines. 4Logix is the newest group company and operates in the local and international bulk commodities rail logistics market. The group has also acted as an incubator for suppliers in its business areas and has an effective 25,1% shareholding in Gijima Supply Chain Management Services (Pty) Ltd. Gijima’s primary focus on the rail bulk commodity market complements the core business of 4Logix.