Metair survives currency volatility to post record results
The company’s overseas acquisitions, particularly in Turkey and despite the lira’s turbulent year, boosted its 2018 performance
Metair, the manufacturer, distributor and retailer of energy storage solutions and automotive components, has produced record full-year results, despite currency volatility in SA and Turkey.
The company’s strong performance in the year to end-December 2018, in which revenue increased by 8% to R10.3bn, bolsters its strategy to seek growth outside SA.
Metair CEO Theo Loock said the company is pleased with its performance, given the history of its struggles in overseas markets. He said that during the year the company saw strong contribution from its overseas units.
“The year saw a strong contribution from our overseas acquisitions in the energy storage vertical, particularly [wholly owned Turkish subsidiary and battery maker] Mutlu Akü in Turkey, which managed to outperform the Turkish lira weakness for the fifth year in a row; and Rombat in Romania, which operated at full capacity in the second half,” Loock said.
According to Loock, during the year the lira was very volatile with a low of R2.07 and a high of R3.13.
Metair CEO Theo Loock joins Business Day TV to discuss the company's full year performance.
Metair’s energy business makes and sells energy storage solutions, mainly for automotive original equipment manufacturers (OEMs). The automotive components business, which makes and sells components mainly for and to OEMs in SA, reported a 16.3% increase in turnover to R5.07bn on the back of improved volumes, supported by positive sentiment and increased exports.
Metair’s operating profit grew by 19% to R1bn, while headline earnings rose 16.2% to R646m. The company increased its dividend per share by 25% to 100c.
Loock said stability in the SA automotive outlook for the next three years will result in higher production volumes at the company’s major OEM customers.
He said the company expects favourable conditions from the components business “based on the increased stability and certainty brought about by the extension of the [government’s production incentive scheme for the automotive industry] Automotive Production and Development Programme (APDP); the conclusion of the SA Automotive Masterplan (SAAM); as well as expected record vehicle export levels”.