The engineering solutions provider in earthmoving, construction, mining and quarrying equipment said that sales rose to R1.7billion compared with R1.05bn in the same period in 2016.
“The increase has mainly been in the engineering services segment due to the progression of major projects, but there were also significant increases in sales in the equipment and Australasia segments,” the company said.
It said sales in the engineering division more than doubled to R974million in 2017 from R452m in 2016. Profit before tax in engineering improved marginally to R24m in 2017 from R23m in 2016, impacted by the stage of completion achieved on these major projects.
It also blamed costs associated with the delay in the award of certain new projects, the higher finance costs as a result of increased working capital requirements and foreign exchange gains as a result of the strong rand for the marginal growth.
In 2016, it said the project work remained at a satisfactory level with projects in Angola, Botswana, DRC, Gabon, Ghana, Israel, Mozambique, Namibia, South Africa and Zambia.
The company said sales in the equipment division jumped to R485m in 2017 from R410m in 2016, and profit before tax increased to R47m in 2017 from R43m in 2016.
Group profit before tax for the period increased by 20percent to R80m in 2017 from a profit of R66m in 2016.
Profit for the period attributable to ELB shareholders increased to R45m in 2017 from R41m in 2016. Headline earnings per share for the period increased by 11percent to R1.58 from R1.42 in 2016.
The company declared an interim dividend of 32cents per share was declared.
Net cash outflow from operating activities of R48m, compared to a net cash inflow from operating activities of R286m in 2016, with a decrease in net cash and cash equivalents to R363m from R437m at the prior year-end.
The company said that it had embarked on a strategy to further increase its know-how and technology-focused solutions by pursuing exponential technology-focused opportunities and partnerships.
“These include the development and incorporation of new technologies into the group such as the Internet of Things, Artificial Intelligence and other disruptive technologies. This will further allow the group to provide a broader service offering to its existing and future clients.”
ELB had previously said that it had invested into a diversification strategy away from its reliance on the minerals and metals related sectors.
ELB shares closed flat on the JSE yesterday at R20.
- BUSINESS REPORT