Brikor reports a mixed performance for the half-year
Intensified load-shedding saw the brickmaker and coal miner increase its usage of diesel by more than 60% in a bid to keep production going
Brick and coal group Brikor has reported a rise in operating profit for the six months ended August 31, with some segments lifted by an increase in DIY projects, additions, and alterations as well as in the informal building sector.
The Gauteng-based company said its brick division performed well during the reporting period as operating profit before interest and taxation of rose to R12.1m from R11.2m.
Despite Brikor and other construction companies having borne the brunt of the slump in construction activity in SA, the group increased its revenue to R167.7m from R152.3m.
Brikor, which was listed on the AltX in August 2007, said adequate planning, sufficient inventory levels, and efficiencies in the production process also contributed to the strong performance.
However, the group said an increase in carbon tax levies and the cost of diesel used in the production process offset some of the advancements.
“Continued power interruptions added additional strain on production and increased overtime was required to curb further production losses,” Brikor said in a statement.
Diesel used in the brick division increased by 60%, while that used in the coal segment rose 69% in the period.
The group failed to capitalise on rising coal prices and demand, owing to the increased cost of production, and excessive rainfall experienced at its mine from October to April which had a direct effect on the production and availability of saleable coal.
This saw the division into a gross loss of R1.4m from a gross profit of R6.1m.
Brikor said coal was only able to benefit from the increased demand and sales prices from May when it returned to full production resulting in higher yields as well as saleable stock as inventory levels increased.
The company made no major capital investments during the period, while in October it said it had become aware of a third party that had approached its major shareholders to acquire all their shares in the firm.
In June, Brikor celebrated the launch of Kopanela Mining by breaking ground on the Grootfontein mine in Nigel, Gauteng.
No dividends have been declared for the six months.
The share price was little unchanged at 18c on Wednesday having dropped 68% over the past year.
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