Over the past five years AECI has pumped R2bn into a capex programme. It positions the explosives and speciality mining and agricultural chemicals group to realise significant growth. The lack of a robust economy shows in the group’s headline EPS (HEPS) growth of an average of 5.2%/year over the past three years to December 2016. It also shows in a fading return on equity, which came in at 9.7% in 2016, against the 14.1% return generated three years earlier. However, to AECI’s credit, it has put up a far more resilient showing than its closest rival Omnia, where HEPS fell 38% in its three years to March 2017. In the six months to June, AECI upped underlying HEPS by a marginal 2%. But there was one positive sign.
AECI’s explosives division, AEL Mining Services, rebounded, with a 19% rise in operating profit to R262m, 38.7% of the group total of R677m. AEL generates annual revenue of about R8bn, of which 60% is earned outside SA. Dragging on overall group performance was AECI’s ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.