Ayo Tech declares 30c maiden dividend
Investment income is due to a surge in capital after listing boosted the group’s results
Software and technology group Ayo Technologies has declared a maiden dividend of 30c per share for the year to end-August.
The group saw a fivefold increase in profit before tax in the year to end-August, bolstered by a surge in investment income as a result of its listing, as well as growth in its underlying assets.
Asset growth in underlying investment and capital raised from its December 2017 listing pushed up net asset value to R4.4bn from R67m during the period, with investment income raking in R226.9m.
The group reported overall revenue growth of 33% to R639m.
Ayo registered its best performance in its security division, which grew revenue 34% to R335m, while software consulting brought in R73m, from the prior period’s R69m.
Ayo’s share price had wobbled earlier in November when it warned that it would need to slash its forecast for headline earnings per share (Heps). The group’s share had lost 3.81% after the statement, but more than recovered this the next day , when it rose 3.96% to R24.95. The group’s share price, which is somewhat illiquid, has not changed since then. It has lost 44.56% so far in 2018.
Heps for the year to August rose 5.66c to 48.32c.
During the period the tech group said a delayed contract with “a major oil and gas multinational company”, which came into effect only in the latter part of the financial year, was the main reason it would not meet its earlier forecasts. It said the contract had gone well since its commencement, saying on Monday “the full benefit thereof will flow over future years”.
Ayo is positioning itself as a major player in the ICT sector, seeking to leverage its empowerment credentials, as well as a lack of legacy systems. The group said on Monday it was seeking to capture between 5% and 8% of the SA market by 2022.
Ayo said in October it planned to participate in the government’s long-delayed spectrum auction, using a portion of the R4.3bn it raised in December 2017 from the Public Investment Corporation.
The company would also be invested in “forward-thinking businesses that will use the frequency of these licences for digitalisation, data and content”.