Altron expecting major boost thanks to restructuring

altron logo
altron logo

Electronics group Altron is expecting a major boost in its earnings for the period to end August 2018 after disposing of discontinued operations, the group has said in a statement.

Its group revenue from continuing operations is expected to increase by between 42% and 46% relative to the prior period.

Headline earnings, meanwhile, are expected to increase by 45% - 52%.

After restructuring several core businesses, the group said many of its operations had performed well for the half-year.

On a normalised basis, continuing operations' revenue was expected to increase by between 41% and 45%, Ebitda was expected to increase by 14% - 18%, and headline earnings were expected to increase by between 22% and 28% from the prior comparative period. 

Continuing operations and normalised continuing operations show a difference of approximately R6m after tax, of non-recurring costs due to the restructuring of operations, the group said. 

"The significantly improved performance out of the discontinued businesses against the prior period has contributed to the ongoing improvement in both earnings and headline earnings per share," the group said in a statement.

With CEO Mteto Nyati at the helm since April 2017, the group is continuing to dispose of non-core assets.

On July 26 this year, Altron announced the removal of Powertech Transformers, which was the largest business in the held-for-sale group. 

Agreement has been reached to sell Altech UEC, the last non-core control asset. The agreement is subject to several conditions, including approval by the Competition Commission, which are expected to be concluded by the end of November 2018.

The half year financial results for the period ended August, 31 2018, will be released on SENS on October 25, 2018. 

Altron [JSE:AEL] shares were trading at R16.08 at the close of the JSE on Tuesday afternoon, down 0.8%.

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