Peter Mountford, chief executive of Super Group, confirmed this yesterday, but stressed that there was nothing in the offering at the moment.
Group revenue increased 27.5percent to R17.97billion in the six months to December from R14.1bn in the prior period. This was largely because of the acquisition of the Slough Motor Corporation (SMC) dealership in the UK and SG In tIME’s acquisition of an 88percent interest in Spanish courier company Ader.
Revenue was also boosted in the reporting period by the inclusion of the Essex Auto Group and the Western Cape dealerships for the full period and a strong performance by SG Coal. This contributed to the 10.8percent increase in operating profit to R1.15bn from R1.04bn.
Mountford said the main reason the growth rate in operating profit was lower than revenue growth was the acquisition of lower margin businesses, including SMC and Ader. Headline earnings a share increased 7.7percent to 155.1cents from 144.0c. Mountford said Super Group’s results reflected geographical diversity, with its offshore operations contributing 46percent of revenue and 62percent of the operating profit.
He said the group did not have a set target for its geographical diversity but would not be uncomfortable at “a 70percent non-South African to 30percent South African positioning”.
Mountford added that foreign currency movements were not significant in the group’s results, because there was a mixture of currency movements. He said a period of rand strength was also not a significant risk to the group as a balanced portfolio.
Mountford said that overall it was a very good financial result by the group, particularly with the 19percent increase in the translation of profitability to cash that was generated at R1.68bn.
However, Mountford said the group did not produce a perfect result and the biggest disappointment by a long way was the softness they were experiencing in the consumer and convenience supply chain market.
Shares in Super Group dropped 7.89percent on the JSE yesterday to close at R42.36.
- BUSINESS REPORT