Omnia's warning of a loss alarms market
Shares lose as much as 16% after chemicals group says it was hurt by economic slowdown and delay in the planting season
Omnia shares slumped as much as 16% on Monday morning after the chemicals group said it would report a loss in the six months to end-September, citing tough market conditions.
The group expects to report on November 27 that its interim headline loss per share will be between 84c and R1.68, swinging from headline earnings per share of R4.20 in the first half of its prior financial year.
Omnia said its fertiliser division — which makes up nearly half of the revenue — suffered from a delay in the planting season. Its other businesses supply chemicals to SA’s struggling manufacturing sector, and explosives to the highly cyclical mining industry.
“The chemicals business remains under significant pressure due to the underperforming manufacturing and mining sectors along with the general slowdown in the SA economy,” the company said in a statement.
The shares were down 10% to R104 in mid-morning trade on the JSE, giving Omnia a market value of R7.2bn.