Investors appear unfazed by fall in Argent’s earnings
The share price of metal products fabricator Argent Industrial was unchanged on Monday morning, after the company reported a decline in headline earnings per share (HEPS) of 25.8% to 31.5c, towards the lower-end of recent guidance.
The company declared a 10c dividend for the six months to end-September, reporting a total loss of R262m for the period, compared with a R37.25m profit in the a year ago.
The decline in large part was due to the economic slowdown in SA, which has led to a number of the groups’s operations being downsized.
The company impaired four of its Johannesburg properties by R44.7m. Three of them due to receiving lower offers/indicative offers, while Phoenix Steel Gauteng was revalued along with the balance of the steel sector assets.
Ongoing strikes and "go slow" industrial action had cost its Toolroom operation during the period an estimated R2.6m, and HEPS would have been 37.7c if this action had not taken place, the company said.
The overseas operation of the group performed to expectation, and Argent intends to purchase an additional operation in the UK.
At 10.20am Argent’s share price was unchanged at R3.85, although the share has lost 14.16% so far this year.