Altx listed logistics group OneLogix has maintained its incremental growth trend, with the latest results announcement reflecting revenue up 59% to R128 million for the six months to November 2006. Exceptional sales performance and solid growth at all subsidiaries supported robust trading performances during the period, particularly at leading auto-logistics provider Vehicle Delivery Services (VDS).
Notwithstanding the exceptional growth in revenue, OneLogix leveraged efficient internal processes to further reduce debtors days and generate increased cash from operations of R10,3 million. High levels of efficiency and strict cost control contributed to the strong operating profit which grew by 61% to R16,6 million, representing 13% of revenue. Headline earnings per share (HEPS) rose by 35% to 5,1 cents a share from 3,8 cents at this time last year.
“Entrenching its cross-border dominance and its new inroads into the local market VDS continued to be the group’s stellar performer during the period,” says OneLogix CEO Ian Lourens. Healthy future prospects were further boosted with two major local contract wins - both becoming operational in April 2007. The group is reaping the reward of its ongoing investment in fleet, software, IT systems and facilities. “Approximately R28 million was invested to meet the high demand for carrier capacity while further investment will be considered to accommodate ongoing growth,” says Lourens. A R6 million investment went towards extending its vehicle storage facilities.
PostNet, servicing the high growth SMME market with basic business services, continued to capitalise on a brand reengineering exercise that has seen new product and service innovations introduced to favourable response. “Media Express (ME) expanded its client base for express printed media delivery and at the same time continued to move further into aligned niche markets,” adds Lourens. In this vein OneLogix leveraged inhouse capability to introduce a collaboration between ME and PostNet. ME assisted PostNet in expanding its product range by providing support for its excess baggage and same day courier services. Referring to this partnership he says: “we recognised the opportunity to utilise existing synergies between our businesses to maximise bottom line growth for the group”.
4Logix and black-empowered subsidiary Gijima also continued to trade well in a traditionally low-margin market, steered by skilled management and safeguarded by long-term contracts. The businesses provide logistics solutions for the rail of bulk commodities to ports nationwide.
Lourens is optimistic for the six months ahead to year-end and says that growth across the board, notably VDS’ relatively new foothold in the local auto-logistics market, bodes well for real growth in HEPS. “The dilutionary effect of the BEE transaction implemented on 22 November 2005 is expected to take effect in the second half of the financial year. Should the growth in this period equate to that of the first half of the interim period, the dilutionary effect is expected to be in the region of 15% percent.” The BEE consortium, led by Sipho Pityane’s Izingwe Capital and including OneLogix staff, owns 25% of the group’s main operating subsidiary.
Lourens points out that strong management teams and well-defined business processes have positioned the group’s companies to take advantage of their high growth niche markets. “Accordingly we anticipate sustainable organic and acquisitive growth.” He concludes that the group will not rule out acquisitions that enhance its offering and will continue to identify and pursue appropriate opportunities.
OneLogix shares closed yesterday at 99 cents a share.
Issued by: Envisage Communications
(011) 325 5944/082 497 9827
On behalf of: OneLogix Group Limited
Ian Lourens, CEO
(011) 396 9040/ 082 440 9683
Issue date: 7 February 2007
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.