Focus on freight lifts Grindrod earnings
The repositioning of the group is ongoing, he said in an interview by phone after the release of the annual results. For instance, freight services division facilities would continue to be enhanced to increase capacity and service offerings.
A buoyant minerals market, such as for magnetite, iron ore and chrome, was expected to boost African trade this year, positively impacting the operations in Richards Bay and Port of Maputo in particular, he said.
Grindrod separately listed its shipping division in the middle of last year, with a primary Nasdaq listing and a secondary listing on the JSE.
Over the past year, headline earnings from continuing operations increased 26 percent to R570.8m. Net cash amounted to R353.2m by year-end, versus R7m net debt at the end of 2017. Shareholders will also no doubt cheer a 14.6c final dividend - no dividend was declared the prior year.
“There is a long way to go yet,” said Waller. He said the company was trading at 70percent of net asset value indicating investors either “didn't like what we are saying, or we are not performing well enough. We would like to get our share price hopefully to at least at net asset value."
Port of Maputo achieved record volumes of 19.6m tonnes, 7 percent higher than the same time last year.
The port expects to increase volume handling capacity with the completion of the rehabilitation works of berths 6, 7, 8 and 9.
The rehabilitation will create berths with a depth of up to -15 metres and will improve the occupancy rate of the berths by creating a larger mooring area. Completion is scheduled for January 2020.
The port recently acquired two mobile harbour cranes and ancillary equipment.
The dry-bulk terminal saw a “marked” improvement in volumes handled in the second half of 2018.
In December 2018, Terminal de Carvão da Matola Lda (TCM) reported a new loading record for the terminal since its inception, of 580 214 tonnes.
TCM’s boom extension project, which started in January 2019 on Ship loader 1, will allow better use of ship loaders, improving vessel turnaround time. The logistics division expanded its footprint after completing the 60000m2 cross-docking facility in Nacala last year.
Full production at the Nacala facility will involve containerising 30000 tonnes of bagged graphite each month.
The auto carrier business acquired 27 hectares of land adjacent to the N3 highway from Gauteng to Durban, for the development of a vehicle storage facility.
The acquisition of Novagroup strengthened the division’s position in the marine technical market and in container storage.
The agri-businesses benefited from improved yields and the higher carry-over volumes.
The financial services division reported solid results. Core deposits increased 14percent to R8.9billion compared to R7.8bn in 2017. Advances grew by 8percent to R7.8bn compared with R7.2bn in 2017.
The group said it would continue to support the transition of the Sassa bank accounts and distribution of payments. New retail offerings were being developed, and the focus on small- and medium-sized business finance was being deepened, said Waller.
Grindrod shares gained 1.31percent on the JSE yesterday to close at R8.50.