The electric vehicles produced as in-house projects by the Metair Group. Picture: SUPPLIED
The electric vehicles produced as in-house projects by the Metair Group. Picture: SUPPLIED

Automotive supplier Metair has opted to cancel a R239m final dividend payment, saying it needs to consider its finances and the chances of a second wave of Covid-19 infections in SA.

The group declared a 120c final dividend for its year to end-December, but deferred it in March, citing economic uncertainty.

The group said on Thursday that while its financial position had remained relatively strong during the Covid-19 pandemic, payment could imperil its solvency, and it still needed to consider the uncertainty that exists in respect of the economic outlook for SA and the globe.

This was especially important in light of a potential second wave of Covid-19 in SA, which has been experienced in most European countries.

The group also opted not to pay an interim dividend for its six months to end-June, when it swung into a R215.8m loss from a profit of R330.3m previously, partially due to its R108m write-off of its 25% stake in German battery maker Akkumulatorenfabrik Moll.

Net group debt rose R60m to R1.378bn, with the group having a ratio of net debt to earnings before interest, taxation, depreciation and amortisation (ebitda) of just below two times.

The group’s debt covenants stipulate a ratio not exceeding 2.5 times net debt to ebitda.

In morning trade on Thursday, Metair’s share was unchanged at R17.90, giving the group a market capitalisation of R3.56bn. The group’s share has fallen 22.5% so far in 2020.

gernetzkyk@businesslive.co.za

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