Adcorp declines in absence of unrealised foreign exchange gains and losses
Trading volumes in the core South African market were negatively affected from the introduction of substantial changes to SA’s labour laws
Adcorp’s normalised earnings per share fell 19% in the six months to August, compared with the same period last year. Normalised earnings per share for the biggest recruitment business in SA came in at 128.1c. "The major cause of this decline in earnings is due to a material swing from the prior period’s unrealised foreign exchange gain included in earnings of R21.1m, to a loss of R18.9m included in this year’s earnings, representing a year-on-year swing of R40m," said CEO Richard Pike. "These unrealised foreign exchange gains and losses emanated primarily from the group’s African operations where the South African rand reporting currency has strengthened against many of the underlying currencies of those African countries, where the group has operations." Pike said that in the absence of these respective unrealised foreign exchange gains and losses, comparable period-on-period normalised earnings per share growth of 6% would have been achieved on a constant currency basis, "which i...
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