Altron hikes interim dividend by 125%

In its first set of results delivered by newly appointed CEO Werner Kapp, Altron has hiked its interim distribution to shareholders by 125% on the back of a big jump in profits.

The technology group reported a 15% increase in revenue to R5.3-billion (21% from continuing operations to R4.6-billion), despite depressed market conditions.

Headline earnings per share jumped by more than 460% to 34c/share (more than 240% for continuing operations). Operating income climbed by 57%.

“The board remains committed to maintaining Altron’s dividend cover of 2.5 times headline earnings on continuing operations. The interim dividend has been calculated on the current continuing operations’ Heps for the six months ended 31 August 2022,” it explained.

Despite the strong performance, Kapp — the former CEO of Dimension Data who recently took the reins at Altron from Mteto Nyati — told investors in a statement that Altron is “not immune to the uncertainty, global supply-chain constraints and inflationary pressures that all of us are subjected to daily”.

“The continued global supply-chain shortages, which result in longer lead times, inflated prices and a shortage in electronic components, impact revenue pressure in our digital transformation segment, resulting in margin squeeze due to increased prices.”

Star performers

Star performers in Altron’s interim results included the fintech segment, where revenue climbed 35.5% and operating profit 71.4%, and the digital transformations segment, where revenue – including from the Lawtrust acquisition – rose by 25.7%, with operating profit up nine-fold year on year, albeit off a low base.

Operating income at Altron Karabina jumped 175%, while Altron Security tripled its revenue and grew its operating profit six-fold.

The managed services segment achieved revenue growth of 16.6%, while generating an operating profit of R21-million compared to a R9-million loss in the prior year. Altron Managed Solutions’ revenue of R900-million was 17% ahead of prior year and operating income of R19-million was up from its prior year loss of R5-million.

Read: Werner Kapp named as new CEO of Altron

Altron Nexus reported revenue growth of 15.7% and a small operating profit, while Altron Arrow saw sales up 26.4%, driven by higher component sales and the Enterprise Computing Solutions software business. Altron Arrow’s operating profit jumped 75%.  – © 2022 NewsCentral Media