Santova attributes its good growth to diversification strategy
Logistics group Santova says its strategy of diversifying internationally enabled it to deliver "meaningful organic" growth in the six months to August 2017.
Expansion of its footprint in the Asia-Pacific region and in Europe/UK meant international operations now contributed 66.5% of overall profit, from 58% in 2016. But overall growth in profit of 27.6% in the period from the group’s logistics operations was generated across all regions, including SA it said.
Asia-Pacific contributed 32.8% to overall growth in profit; the Europe/UK region 20%. SA added 29.2%, despite the poor domestic economy and ongoing political and economic volatility in the Southern African region.
"Had it not been for the strengthening of the rand across most currencies in the second half of the 2017 financial year, the group’s overall results would have benefited much more favourably from the translation of its foreign earnings," Santova said.
Headline earnings per share were up 12.4% from the same period in 2016. The rand had strengthened an average 22.5% against the pound and by 12.7% to the euro over the comparative period a year ago. But a 32.4% plunge in group finance costs and a 2.5% fall in the effective tax rate — plus an official 1% decrease in the UK corporate tax rate — helped profitability.
Meanwhile, the buyout of the remaining 25% minority interest in Santova Australia meant profit attributable to minority shareholders was cut by 96.8%.