Alviva shares rise as technology group hikes dividend 11%

Shares in Alviva Holdings rose almost 5% on Monday after the technology group reported full-year revenue up 17% to R15.9-billion. Headline earnings per share climbed 9% to R2.97.

Despite the solid performance, Alviva, whose assets include Axiz, Pinnacle and Datacentrix, said the year ended 30 June 2019 was a “difficult trading period” as a result of the continued weak South African economy.

Because most of its operations are exposed to the South African economy, and given there has been little or no growth, “it would be of no surprise to advise shareholders that this has been a challenging operating environment”, it said.

“Notwithstanding this, the investments made into new businesses have helped increase revenue and Alviva’s existing businesses have produced a resilient performance to allow the group to maintain its returns to shareholders.”

It said the outlook for the financial year ahead is “unclear”, with the economy “under huge pressure with no apparent appetite for investment”.

“Much needs to be done to turn around confidence in the business arena. Notwithstanding these factors, the group has well established businesses with solid, experienced management in place who have shown themselves to be adept at growing revenues during times of hardship.”

‘Cautiously optimistic’

New acquisitions, it said, offer “exciting prospects” and it is “cautiously optimistic, albeit that we are surrounded by despondency”.

Alviva’s earnings before interest, tax, depreciation and amortisation — a measure of operational profitability — rose 5% to R860-million. It declared a gross dividend per share of 30c, up 11% on a year ago.

The group’s share price closed up 4.7% on Monday at R16.49. In the past year, it has declined by 15.1%.  — (c) 2019 NewsCentral Media