M a r k e t N e w s

Growth in vehicle sales drives Super results

Posted on : Wednesday, 31st August 2016

 SUPER Group, which dubs itself a "transport logistics and mobility group", bucked the trend in South African vehicle sales, reporting a "solid set of results" for the year to the end of June.

CEO Peter Mountford said on Monday that South African market conditions were expected to remain challenging and competitive. But that did not stop new vehicle sales by its dealerships from jumping 6.8%, as National Association of Automobile Manufacturers of SA data fell 5.6%.
"It’s a substantial outperformance in relation to the market," Mountford said. He said there had been an emphasis on service excellence at the company’s dealership operations.
Super Group had substantially increased its international footprint in the past two years. This had boosted revenue and profit. Group revenue shot up 31% to R26bn. Headline earnings per share jumped 10.4%, as net asset value per share increased 30.7% for the period.
"At year-end, the non-South African businesses contributed 42% and 60% to revenue and operating profit, respectively," Mountford said.
"We are pleased to report that the growth in offshore revenue was 103%, operating profit 66%, and profit before taxation 52% over the reporting period," he said.
Mountford said a weaker rand had some effect on the result. But it was mainly the performance of the group’s FleetAfrica, SG Fleet, and dealerships operations that drove the results.
Meanwhile, the inclusion of results from Allen Ford in the UK, its majority holding in a German logistics group, and the buyout by its Australian-based SG Fleet subsidiary of motor vehicle leasing group NLC, had also boosted turnover and profitability. Despite the costs of these acquisitions, the group reduced gearing from 31.9% in December 2015 to 21.4% at the end of June.
Mountford said that despite the subdued outlook for SA, Super Group would continue to look for strategic investment opportunities both internationally and locally. It had recently announced the acquisition of nine Western Cape vehicle dealerships for about R490m, and had also bought a property for R200m from Sandown Motor Holdings, a subsidiary of Mercedes-Benz. The deal was expected to be effective in September.
Subsequent to year-end, SG Fleet had announced the £19.6m buyout of Fleet Hire, a UK contract hire, short-term rental, and fleet management provider, effective August 2016.
Super Group said the acquisition provided SG Fleet with scale and profitable growth in the UK, while establishing a "strategic platform in this attractive market".
Due to the late afternoon release of Super Group’s results, analysts were unable to comment on the company.

Source : www.bdlive.co.za
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