Metair optimistic as new vehicle types enter production
The automotive group says while 2020 could be a difficult year, the longer-term outlook remains positive thanks to new contracts
Metair, the manufacturer, distributor and retailer of batteries and automotive components, says it has secured a string of contracts as new vehicle types enter production in SA.
While vehicle production volumes for 2020 are forecast to be static or slightly down, the group said it is optimistic about the next three years, having secured contracts at Mercedes Benz, as well as for new Nissan, VW and Isuzu models.
“Metair group companies have been successful in securing major contracts arising from the new vehicle launches planned to service the export and local markets over the next three years,” the group said.
Metair reported that headline earnings per share rose 3% to 336c in its year to end-December, which the group said provides a “sound foundation” for delivering on its new contracts.
Headline earnings is a widely used profit measure in SA, giving a better indication of underlying performance after stripping out exceptional items.
Turnover from the group’s automotive components businesses increased by 11.3% to R5.6bn during the year, on improved volumes, supported by exports and the continued expansion and deepening of localisation requirements.
The group said it is monitoring the potential effect of the coronavirus outbreak, while 2020 has seen declining vehicle volumes, amid issues such as load-shedding.
“Metair is fortunate that almost all its subsidiaries were awarded their respective product portfolio for the new vehicle, namely head and tail lights, shock absorbers, wire harnesses, batteries, plastic parts and suspension control parts,” the group said.
“Metair’s management will have to remain flexible in the roles required to achieve these objectives,” the group said.