Electrical wholesaler and lighting distributor ARB Holdings reported a strong half-year performance thanks to a R13.8m drop in the fair value of a put-option liability issued in favour of minority shareholders of its Eurolux division.

The fair value was sensitive to movements in the company’s share price, the company said.

Headline earnings per share for the six months to December rose 34% to 37.62c.

CEO Billy Neasham said the put option would not be exercised at the company’s current share price. ARB is an investment and property holding company with assets across related trading and distribution businesses.

This includes 74% of ARB Electrical Wholesalers, a level 2 black-empowered company, operating 22 electrical wholesale branches throughout SA, and also 60% of Eurolux, which imports and distributes light fittings, lamps and related accessories. The group derives about 10% of turnover from Southern African countries.

"The results were satisfactory in a very challenging environment," Neasham said on Thursday. He said the fall in the value of the put option had added 20% to headline earnings per share, which shot up 34%. The group achieved a 2.8% increase in operating profit to R107m in the period. This came after a 5% rise in revenue to R1.34bn.

Meanwhile, the group remained ungeared with R227m of net cash on hand.

Nedbank said earlier in February that capital expenditure on projects in SA had plunged in 2017. This came as confidence in the country’s construction industry fell to a 17-year low. ARB services infrastructure markets, along with retail and other sectors.

Nedbank said the value of capital projects in the year came to R63bn from R91bn in 2016. The number of projects fell to 48 from 67 in 2016.

The private sector funded most of these.