Media Releases

Reunert improves HEPS by 29%
Tuesday, 16 May 2006

By: Carina de Klerk 

Reunert's headline earnings per share grew 29% to 232,6 cents per share during the six months ended 31 March 2006. Turnover increased by 19% from R3 276 million a year ago to R3 911 million resulting in operating profits improving by 23% to R524 million.

A dividend of 63 cents per share, up by 21%, has been declared for the first six months.

Commenting on the results Pretorius said the buoyant economic climate in South Africa helped considerably towards achieving revenue growth approaching 20%. "The improvement of infrastructure in South Africa led to an increased demand for products from our electrical engineering division that increased turnover by 31% to R1 149 million. Operating profit went from R166,7 million a year ago to R222,5 million, an improvement of 33%."

�Stripping out the effect of the huge increase in the international price of copper, the power cable manufacturer, African Cables, grew sales by 17%,� he said. Capacity is currently being increased in anticipation of increased future demand.

More favourable market conditions enabled ATC, the telecommunications cable manufacturer, to double revenues. Increased demand came from operators installing much needed bandwidth, Pretorius explained. ATC is also planning to increase its activities into Africa.

"Circuit Breaker Industries is reaping the rewards of building an export business over many years," said Pretorius. Exports grew by 40% in the comparable period, now representing 27% of CBI's total revenues. Locally, CBI�s performance is underpinned by the ongoing drive by government to provide housing for all. Sales to the residential market grew by 7%.

The electronics division, Pretorius stated, improved operating profits by 24% from R311 million to R386 million as revenue increased by 17% to R3 466 million.

Both the office automation company, Nashua, and the cellular business, Nashua Mobile, had a strong growth in volumes. The related finance company's debtor book is now in excess of R1,2 billion.

The consumer electronics business, suppliers of Panasonic, Akai and Futronic, managed to grow sales despite price deflation in this sector.

Activities at Siemens Telecommunications in which Reunert holds a 40% stake, was at an all time high. Operating profits attributable to Reunert, improved by 64% from R52,3 million to R85,8 million. Pretorius ascribed this to the expansion of mobile and fixed line networks by Siemens -  customers Telkom and Vodacom, but warned this is not likely to be matched in the second half.

After defence business, Reutech, made a small loss last year it improved operating profit to R3,8 million. Pretorius expected profitability to improve in the second half of this year.

Most of the group's operations are expected to benefit from the current buoyant market conditions. Therefore Reunert should continue to deliver headline earnings growth in the second half of the year.

For more information contact
Carina de Klerk
Tel 011 517 9033
Mobile 083 631 5743