SA government is on right track, says Super Group

JOHANNESBURG – Listed transport and mobility company Super Group is encouraged by the government’s anti-corruption stance, which it believes bodes well for South African businesses in terms of securing tenders, especially its Fleet Africa business.

Peter Mountford, the group chief executive of Super Group, confirmed yesterday that the group had felt it had not been awarded tenders in the past because of corruption.

However, Mountford stressed that was not to taint everyone with the same brush, and the government’s anti-corruption stance boded well to have visibility on corruption.

“There are some (tenders) that have been very straight forward and squeaky clean.

“We have even had well publicised scenarios outside South Africa, where awards are given and then go to a president, and he reverses the award and gives it back to another operator and everybody gets told to shut up or disappear,” he said.

Mountford added that the group was exploring viable acquisition opportunities, both locally and abroad.

He said there were some really attractive opportunities in all the territories in which the group operated, including Australia and Europe, but particularly South Africa.

“There is just a plethora of opportunities coming forward now in South Africa. I think this market is somewhat unsettled and you are getting a lot of people looking at potentially rationalising businesses and/or exiting businesses.

“There are big groups rationalising portfolios and then lots of private companies where I suppose the unsettled socio-political environment has got guys looking to diversify their portfolios. So there is a lot of opportunity out there,” he said.

Potential

Mountford doubted any of these potential acquisitions would be finalised in the next six months, but it was possible within the next eight months.

“We’ve got a lot that we are looking at, but it’s early days,” he said.

Super Group has continued its strategy of geographically diversifying its revenue stream, with revenue from its non-South African businesses accounting for 47percent of group revenue in the year to June, compared to 40percent in the previous year and 60percent of operating profit, the same as the previous year.

Mountford said acquisitions would both diversify group revenue and profit streams and strengthen the group’s position in niches it believes were high growth and represented a good platform into the future.

He added that the group was obviously open for business both in South Africa and internationally, but would like to see about 70percent of its operating profit derived from non-South African businesses over time.

Mountford said the excellent performance of the commodities businesses within Supply Chain Africa, good contributions from acquired businesses and solid results from SG Fleet contributed towards the group’s record results for the year to June.

Super Group reported yesterday a 15.3percent growth in headline earnings a share to 332.2cents from 288.2c.

Revenue rose by 19.4percent to R35.7billion from R29.9bn.

Super Group shares gained 6.94percent on the JSE yesterday to close at R36.36.

– BUSINESS REPORT