AYO cuts interim loss significantly, sets itself up for better second half

Amit Makan, chief executive of AYO. Photographer: Armand Hough. African News Agency (ANA)

Amit Makan, chief executive of AYO. Photographer: Armand Hough. African News Agency (ANA)

Published Jun 3, 2024


ICT investment group Ayo Technology Solutions (AYO) managed to cut its losses by a significant 62%, to R98 million, in the six months to February 29, setting it up with the prospect of a solid second half.

The improved performance, which saw its share price increase as the market closed for the weekend, was largely due to the embedding of restructuring and ongoing cost containment measures under a leadership team who took over the reins a year ago.

The results were positively received by shareholders, as the share price increased 4.26% to 49 cents at the close of the market on Friday, outstripping the All Share Index’s overall decline of 0.59%,

The improved results were also despite only a slight increase in revenue to R1.02 billion, from R1.01bn in the prior corresponding financial period.

“Over the last 12 months we have concentrated on streamlining operations, improving relationships with our partners and bolstering our underlying subsidiaries,” chief executive Amit Makan said.

The constrained economy, continued negative publicity and ongoing banking challenges facing the group had constrained it’s business development, organic growth initiatives, and its ability to complete significant acquisitions.

“However, the business units have remained resolute to the challenges and continue providing the best service to their valued customers. The hard work and dedication of our entire team is beginning to reap rewards,” said Makan.

“It’s a long road ahead, but I am confident that we now have a solid offering that will deliver real shareholder value in the long term,” he said.

AYO, a diversified ICT group with interests in managed services, software, consulting, unified communications and healthcare, also posted a normalised profit after tax of R13.6m, from a loss of R168.6m in the prior six-month period ended February 28, 2023, reflecting an improvement of 108%.

The headline loss per share improved by 58.14% to 33.12 cents a share from 79.13 cents in the prior corresponding period.

The group did not pay out a dividend in this period, electing to reinvest into its businesses.

The group intended to continue nurturing relationships with current customers and suppliers to grow current contracts and exploit its current opportunities to the best of its abilities. Acquisition or partner opportunities would be sought with companies in disruptive technologies, and those with a focus on artificial intelligence.

“As an ICT investment holding group, AYO's focus for the next 18 months is to strengthen the underlying subsidiaries, contain costs, overcome banking challenges and provide subsidiaries with access to funding lines,” the group said.