JSE-listed know-how distributor Mustek has slashed its dividend by 90% to 7.5c/share after it reported an 82% hunch in headline earnings per share.
Income for the 12 months ended 30 June 2024 declined by 16% to R8.5-billion from R10.3-billion a 12 months in the past as gross sales of renewable vitality options tanked following the suspension of load shedding by state-owned electrical energy utility Eskom from March.
“Prevailing uncertainty froze company and authorities spending, and the sudden abatement of load shedding abruptly ended the renewable vitality growth, which fuelled our development final 12 months,” Mustek mentioned in commentary alongside its annual outcomes.
“Lowered demand for inexperienced vitality merchandise put us in a difficult scenario with surplus inventory in a troublesome macroeconomic surroundings with excessive rates of interest,” it mentioned.
Gross sales of inexperienced vitality merchandise declined by R1.35-billion 12 months on 12 months. Gross revenue on inexperienced vitality merchandise diminished by R338-million. Margins on these merchandise diminished from a median of twenty-two% to 14%, whereas margins on the remainder of the enterprise remained secure.
Mustek mentioned the working surroundings was characterised by warning main as much as the 29 Could normal election.
The normal ICT distribution a part of the enterprise was “comparatively secure”, it mentioned.
Margins
“The group’s two largest companies, Mustek Operations and Rectron, noticed their income decline by 12% and 24%, respectively. Our IT coaching firm, Mecer Inter-Ed, skilled a decline in income to R85-million (FY 2023: R98-million) in unfavourable market situations.”
The gross margin declined to 12.2% from 13.9% beforehand on account of “aggressive forces out there for inexperienced vitality merchandise, product composition and efforts to decrease inventory ranges”.
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Mustek mentioned that consolidation and streamlining the administration of important features to strengthen its monetary place is a strategic precedence for administration within the 2025 monetary 12 months.
“It will embrace disposing of non-performing property and consideration of complementary acquisitions that align with our core competencies and pursuit of numerous income streams,” it mentioned.
Already, it has introduced a plan to promote Zaloserve (buying and selling as Sizwe IT Africa) for R15-million. It didn’t say who was buying the enterprise.
Mustek has additionally acquired a 70% fairness stake in a cybersecurity specialist, CyberAntix, for R8-million. CyberAntix supplies a safety operations centre-as-a-service answer.
“We foresee a extra secure interval forward and are aiming for a considerable enchancment in money circulate, additional discount in working capital and a stronger stability sheet,” Mustek mentioned. – © 2024 NewsCentral Media
