Brikor eyes expansion as financial position improves
The group swung into an interim loss amid Covid-19, but is looking to expand after recently regaining its JSE listing
Bricks and coal group Brikor, which only regained its JSE listing in July after a seven-year suspension, says it is focusing on expansion and improving its black empowerment credentials as its financial position improves.
The group swung into an interim loss as Covid-19 hit the construction sector, but it says its risk profile has improved as it pays down its remaining debts, and it wants to expand its local footprint.
Revenue fell 23.1% to R127.8m in the six months to end-August, with revenue in the group’s brick business falling 34% to R58.7m That business generated no sales during April, and had limited sales from essential services customers during May.
Sales returned to pre-lockdown levels in August and September, Brikor said.
Revenue from its coal segment fell only 10.2% to R69.1m, and was able to operate at 50% capacity during the intial lockdown period, and at 100% from May 1.
The group swung into a R1.66m loss, from profit of R11.4m previously, but says its last major remaining debts are to shareholders. Loans from shareholders stood at R8.5m at the end of August, from R16m at the end of the prior comparative period.
“With a lower risk profile, the group is well positioned to unlock more opportunities in the mining and construction sectors and broaden its local footprint in the market,” Brikor said. This would entail looking at ways to expand its production capacity.
Brikor, which is a supplier of building and construction materials and also mines clay and coal, was suspended from the JSE in July 2013 after entering provisional liquidation. It emerged from this in October 2015.
At the end of February 2013, the group’s liabilities of some R184m were more than twice its assets, while the group had also been embroiled in a legal dispute with its financier, RMB, over the issue of financial covenant breaches.
The group was also under some pressure at the time from a slowdown in SA’s residential building sector.
In afternoon trade on Wednesday, Brikor’s share was unchanged at 5c, giving the group a market capitalisation of R32m. Its share has fallen 44.44% since relisting on July 23.
Would you like to comment on this article or view other readers' comments?
Register (it’s quick and free) or sign in now.
Please read our Comment Policy before commenting.