Afrimat has published its results for the six months ended August 2023, reporting an increase of 9.6% in group revenue from R2.6 billion to R2.8 billion with its operating profit having increased by 4.3% from R512 million to R534 million, resulting in an overall operating profit margin of 18.8%.
Despite being impacted by load shedding, and a general economic slowdown in certain segments, Group CEO Andries van Heerden says that the company’s strategy to diversify between commodities and revenue streams, coupled with stringent capital allocation, has enabled the group to weather economic and commodity shocks.
“For most of the 2023 calendar year and in the period under review, Afrimat invested substantially in projects that are expected to yield fruitful returns and further strengthen our product diversity and competitive advantage in the future.”
He went on to say that the group managed the volatility of the iron ore price by combining local iron ore sales at defined prices with the export sales. “Pleasingly, the Group also experienced a significantly improved contribution from the Construction Materials segment.”
Headline earnings per share remained satisfactory with an increase of 4.4% from 252.2 cents to 263.4 cents.
The company’s balance sheet remains strong with a net cash balance of R278.7 million. Net cash from operating activities of R577.5 million was generated. The debt: equity position remains favourable at 6.2% (February 2023: 4.7%).
Afrimat declared an interim dividend of 40 cents per share.